Venezuela announces changes to foreign currency system

The Venezuelan government is to adopt new measures to better regulate the country's foreign currency in a bid to restore the balance of Venezuela's economy. Speaking during an interview aired on local private television network Venevision on Sunday, Venezuela's vice president for economic affairs Rafael Ramirez confirmed that 82 percent of the country's foreign currency will be sold at a subsidized official rate of 6.3 Venezuelan bolivars per U.S. dollar, with the remaining 18 percent sold at a double rate. Ramirez, also Minister of Petroleum and Mining, said the government will allocate 42.96 billion dollars of the currency to prioritized sectors including health, education and feeding. Eight-two percent is the necessary amount for the effective functioning of the country's economy, he said. The government will address about 11.8 billion dollars to be purchased in the weekly auction held by the Complementary Currency Management System(Sicad). "We are not going to deviate from our political plan," said Ramirez. "The currencies from oil revenues, some 96 percent of the total, belong to the people and will have a preferential rate of 6.3 bolivars." "Despite this, we have also considered the non-essential things and we will also address currencies to that but with another rate, the one from the Sicad auctions." Ramirez said these measures will help restore full supply of food in Venezuela and help boost national production, adding: "We have spent millions of dollars in bringing food to Venezuela, and if we had not established distribution systems, we could not have attended the people's needs." Ramirez also claimed that the right-wing opposition is affecting the food supply through speculation, smuggling and hoarding. Venezuela introduced foreign currency controls in 2003 to prevent massive capital outflows and to redirect the country's oil revenues to social and economic programs.