Bolívar Distorted: The Effects of Exchange Controls on the ...

daily, but has recently hovered around Bs. 3,200/ $US, effectively halving Cruz’s ability to
provide for her child abroad. 77
In June <strong>of</strong> 2003, almost five months after its creation, CADIVI finally enacted a
provision for remittances under which any person could solicit up to US$300 per month to send
to family members abroad. 78 <strong>The</strong> solicitation process, however, did not get any easier or faster
and requires documentation from both the sender and receiver <strong>of</strong> funds. Many still find it easier
and more effective to buy their dollars on the parallel market.
As many Venezuelans are finding they are unable to make a living and thus trying to
leave the country, so are many immigrants. Cruz is considering moving to the interior <strong>of</strong> the
country, a less populated region that she thinks is more stable, less chaotic, where she can find
better paying work. 79
Meanwhile, banks and investors are making excellent returns on the pegged Bolivar
through currency exchanges, loans and ADR shares. Chávez’s revolution to empower the poor
has instead brought riches to investors who were smart enough to start early 80 and only
exacerbated poverty in already depressed areas. 81
Price Distortions
Remittances are not the only way that salaries have been eroded since the exchange
controls were implemented. While price controls keep basic staples from becoming more
expensive, there are <strong>of</strong>ten shortages, and the staples are hard to find. Goods that are not
considered part <strong>of</strong> the food basket are experiencing significant price changes. Electronics,
77 Fellita de la Cruz. Interview. July 2003.
78 Francisco Toro. Interview. July, 2003.
79 Fellita de la Cruz. Interview. February, 2003.
80 Francisco Toro. Interview. July 2003
81 Erin Fletcher. “Fighting Poverty the UNDP Way.” VenEconomy. July, 2003.
32