GLOBAL ECONOMY

Cost of corn flour in Venezuela skyrockets 900% as economy continues to slide

The arepa – a corn flour patty that's typically stuffed with meat, cheese and vegetables – is a staple of the Venezuelan diet, but that regional dish has become a lot pricier after the government-controlled price of corn flour skyrocketed almost 900 percent.

For the last 13 months, the government of President Nicolás Maduro kept the price a steady 19 bolivares per kilogram – which is a little less than $2 at the official exchange rate. But earlier this week, Venezuela’s Superintendent of Fair Prices increased the price of corn flour to 190 bolivares per kilo, or around $19.

The move comes as Venezuelans already are facing a severe economic crisis, with the world's highest inflation (180 percent in 2015, and a projected 700 percent for 2016) and shortages. The country's oil-dependent economy has been crippled by the drop in global prices.

Polls also indicate that most Venezuelans want Maduro out of office.

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Corn flour has become scarce, and the Venezuelan Association of Corn Flour Industrialists pleaded with the government for a price increase, arguing that the low government-set price did not meet the cost of production.

Besides flour, the government-set price of chicken – price-controlled since February 2015 – also went up 13 times from 65 bolivares a kilogram to 850 (more than $85).

The price spike came following a warning earlier in May that the cost of price-controlled products would be updated to better reflect the cost sustained by producers.

Venezuela’s "Law of Just Prices" sets a maximum profit margin on all goods and services at 30 percent, but food and medicine prices are "compressed" to between 14 and 20 percent.

The Associated Press contributed to this report.

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