Operation "Lechuga Verde"

Already months ago, since the flight was booked, it was clear to me that I would visit not only Colombia, but one of its neighbour countries as well. The country that I have been paying special attention to was Venezuela, whose people have been plagued by numerous problems as of late. In a Russian social network website I started to get in touch with some Venezolanos to learn more about their country. Visiting Caracas and the Angel Falls was my main priority. But the prices in Caracas, which at first glance seem extremely high even for European standards, temporarily turned my attention away from Venezuela, making me come up with alternative plans for my second trip to South America, until a local from Venezuela urgently asked me to bring US-Dollars to Venezuela, explaining me a very unique phenomenon in her country. After doing some deeper research on the issue she mentioned, the plans for my second trip to South America completely changed in favor of Venezuela.

 

Thus, Operation „Lechuga Verde“ („green salad“) was under preparation. This term has been used by many Venezolanos as a code word, ever since its government decided to prohibit any kind of communication revolving around the „dolar paralelo“. The new government of Venezuela has been trying to perpetuate the trend of the late Hugo Chavez to diminish US influence in Venezuela. However, years ago, under the rule of Chavez, The lack of dollars had already led to a boom in the black market. Now the 'dolar paralelo' has found a new peak under president Maduro. And we are not only talking about a new peak, but about a very unique situation that you will not find in any other country. The official exchange rate is 6,43 BsF (Bolivares Fuertes) per dollar. As I took a look at the black market rates, I started to understand why my new friend started to speak with me about this topic with so much enthusiasm. At that time, one dollar was worth 75 BsF in the black market.

 

Bearing this in mind, not a lot of imagination is needed come up with highly profitable ideas. In 2013, one man had such an idea, travelling to Venezuela to book 16 flights to various countries around the globe. Thanks to the black market, he only had to pay a ridiculous amount of 600$. Now before your euphoria makes you book a ticket to Venezuela, you should continue reading. The deficit in the national budget that came about because of such opportunistic actions were of course not left unnoticed by the government, and of course the airlines learnt about the accumulating error fare-like bookings that had been made. Therefore the prices for international flights skyrocketed and many airlines stopped doing business with Venezuela. Consequently, most Venezolanos can no longer fly out of their country.

 

It is also self-explaining that as a result of the paralelo boom, all kinds of export products in Venezuela have become extremely expensive, as otherwise all kinds of foreign companies would stop doing business with Venezuela. The government of Venezuela has so far refused to devalue its currency. In order to prevent the continuation of the black market trend, and as a means to calm down foreign investors, it established a third and even a fourth currency system, called SICAD I and SICAD II. The former was fixed at the price of 12 BsF per dollar. At that time, buying US-Dollars in the blackmarket was much cheaper than it is today, but it did not take long until this rate drifted further and further away from the SICAD I rate, leading to the SICAD II system, where one dollar equates 50 BsF. But while the prices have partially been adjusted to these two systems, the economic situation is worsening dramatically, albeit this is not solely connected to the government's mismanagement, but things have become only much worse as a result of OPEC's oil politics that have led to the oil prices hitting new record lows, harming nobody more than the country with the largest oil reserves in the world. On top of that, the United States has recently decided to impose sanctions against Venezuela for "violating human rights".

 

In the meantime the grievances of the Venezolanos continue to grow, and so does the price for dollars in the black market. For many Venezolanos, nothing is more lucrative than meeting foreigners to exchange money at an unofficial rate. But because of the precarious situation in Venezuela, as well as the lack of international flights, foreigners remain a rarity in this country. Those who decide to come to Venezuela can easily multiply their money in the black market, albeit with restrictions in several aspects. At first glance, bank and credit cards in Venezuela suddenly seem to be nothing more but aesthetically cut and colored pieces of plastic without any function, because of course the money is charged according to the official rate, making a McDonald's menu cost 40$, while buying a hot dog on the streets can cost as much as 5€ officially, but measured by the black market rate you only pay 10 cents (30 BsF).

 

The prices for many products cannot be adjusted to the black market rate. For a foreigner such a scenario only means that he would be much less wealthy, while still being wealthy. But for the Venezolanos this would have very devastating implications, and their current situation is already so devastating that there are many protests that end up with clashes between the protesters and the police. The situation is so devastating that in order to enter a supermarket the Venezolanos have to stand in line for so long, as if they were standing in line for a concert. People fight for the last rolls of toilet paper as if they were fighting for the last iPhone. And for most Venezolanos many of the exported products are only luxury products reserved for a minority. The Venezolanos'  average salary is around 6000 BsF, which is approximately 25€ according to the paralelo rate. Thus it is impossible that Venezuelan products and services can become more expensive to such an extent that the foreigners do no longer profit from it at least 10 times as much.

 

In Venezuela, the foreigner's cash is literally worth its weigh in gold. But how much cash can a foreigner dare to carry around in Venezuela? „There are people who are ready to kill you for 1000 BsF“, a Ukrainian from Valencia let me know. Because as poor as the average Venezolano seems to be with a salary of 25€, compared to many people who live in the Barrios of Venezuela, they are doing well enough to be targeted by thugs who point guns at them and mug them. Hence, many people do not really regard it as the most reasonable idea to bring too much cash to Venezuela. So the question was if there are other ways. The Venezolanos themselves constantly come up with new ideas to get dollars. And necessity is the mother of invention: Soon they began to establish Amazon gift cards as an inofficial currency in Venezuela. The Internet dollar was on a rise. Some locals preferably use the bitcoin currency, because the respective subsidies that they receive from the government enable them to use electricity in vast amounts, which is decisive for generating bitcoins. But the problem remains that Venezolanos need foreigners in their country to do business with them, and foreigners do not need Venezuelan money outside of Venezuela, since this currency has no value in other countries. If it had any value outside of Venezuela, the entire economic system would eventually fall apart, because potentially everyone outside of Venezuela could generate an unlimited amount of money, selling dollars, and then again selling the multiplied dollars he received. And yet there are potential ways to continuously multiply your money, but such undertakings are not only quite complex, they would harm the people of Venezuela and are very serious violations of law.

 

With respect to legal consequences for doing business in the black market, it is a whole different story. A friend from Venezuela told me about a Russian, who refused to exchange the money on a paralelo rate, because he was afraid of getting in trouble with law. „Can you believe that?“, she asked me with eyes wide open. Such an exchange is technically illegal, but apart from the fact that the government is now even considering to legalize the black market very soon, it is perhaps more likely that somebody will be arrested in Germany for downloading a song on the internet, at least as long as you use common sense in Venezuela. For Venezolanos it is a taken for granted reality that this law is being ignored, because too many Venezolanos have no other choice but to buy and sell dollars in order to survive or to live a life that is worth living. And the Maduro government has no other choice but to turn a blind eye on that, otherwise they have to imprison millions of people, many of whom already feel imprisoned because of the economic misery. 

 

Within a few months and shortly before my arrival in Venezuela, the black market rate more than doubled, one dollar already being worth 185 BsF. One thing became crystal clear: It's a different ball game in Venezuela, a situation that is unlike anything I have ever witnessed in my journeys. The foreigners in Venezuela can become much richer than they would imagine by making the locals richer. However, one way or another, everything has its price: The rise of the black market correlates with the rise of social unrests and increasing dangers in Venezuela, which will be dealt with in the third part of this report. But how did the theory of the paralelo rate turn out in practice? This will be dealt with in the second part of the Venezuelan chapter, a report on crossing the Colombian-Venezuelan border.



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