Caracas, Venezuela – Imagine this: $20,000 cash, in $10, $20 and $50 bills. Not long ago, a 79-year-old lady in Caracas, Venezuela, received her pension in such way — a mountain of bolivar bills she had trouble taking home.
“I have to put them in the suitcase, because they don’t fit in my wallet,” Clarisa Matson de Garcia told Fox News Latino. “And then I pray that nobody robs me in the street.”
With the enormously devalued Venezuelan currency ($1 equals roughly 4,400 bolivars in the black market), those 20,000 bolivars barely pay for a T-shirt or a birthday cake.
The highest denomination bill in the country is currently 100 bolívars, the cost of a piece of candy. In a country where approximately 35 percent of the population does not have a bank account, the out-of-control inflation has turned every petty errand and transaction into a major headache.
“Sometimes, when I try to pay with a pile of 10 bolívars, people don’t accept it,” Matson de Garcia said.
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Last week, after months of popular clamor, the Central Bank announced that in mid-December it will start rolling out bills of higher denominations. The new highest bill will be 20,000 bolivars — some $4.55 in the black market rate, the only market actually available to Venezuelans due to the government's tight currency control.
But it will not happen overnight. This week, Central Bank president Nelson Merentes said that on Dec. 15 the bank will start circulating 500 bolivars bills. The other denominations – 1,000, 2,000, 5,000, 10,000 and 20,000 – will be issued at a later time.
Most economists agree that issuing new bills will alleviate the problem, but not solve it.
“It’s a relief because the ATMs will have bills of greater denomination, and people won’t have to withdraw 60 bills of 100 bolívars to pay for a taxi,” said economist Victor Alvarez. “You’ll be able to do it with six. It will relieve some of the operations in the informal sector.”
The shortage of cash is being increasingly felt in ATMs and banks across the country — now Venezuelans need to wait in long lines not only to get food and other essentials, but also to get their own money (limited to 10,000 bolivars a day).
Last Sunday, one of the main shopping malls of Caracas, Sambil, had just one ATM in service.
“I didn’t have cash to pay the bus home,” Roberto Aponte, a young man who had come to the mall to watch a movie, told FNL. “It took me an hour to get the money.”
Economist Asdrubal Oliveros, director of Ecoanalitica, explained that the cash shortage is due to the fact that currency in Venezuela is rendered useless by the country's chronic inflation.
“The value of things is way above the bills that we have, and citizens need more bills to do the most elementary things,” Oliveros said.
A foreign correspondent working in Caracas, who asked not to be named and does not have a bank account, said he moves around the city with several bags of cash and his pockets full of bills in order to pay for the most basic things.
He said he recently went out to dinner at a restaurant with a friend and the check came to 25,000 bolivars. He used 250 hundred-bolivar bills to pay.
It makes any kind of shopping cumbersome.
“I’ve been preparing for Christmas for two months now,” he told FNL. "I have mountains of bills in my house to spend the holidays. I'm worried about running out of cash and have a really difficult time."
Alex Vasquez is a freelance reporter living in Caracas, Venezuela.