Tag Archives: hyperinflation

Worst Financial Crisis since WWII says hedge fund giant

Revelations 18:23:’For the merchants were the great men of the earth; for by thy sorceries were all nations deceived.’

Important Takeaways:

  • Hedge fund giant Elliott warns looming hyperinflation could lead to ‘global societal collapse’
  • Hedge fund Elliott Management, who warned that the world is heading towards the worst financial crisis since World War II.
  • The Florida-headquartered firm told clients that they believe the global economy is in an “extremely challenging” situation which could lead to hyperinflation. Elliott did not respond to MarketWatch’s request for comment.
  • They added that the “extraordinary” period of cheap money is coming to an end and has “made possible a set of outcomes that would be at or beyond the boundaries of the entire post-WWII period.”
  • The world is “on the path to hyperinflation” which could lead to “global societal collapse and civil or international strife.”

Read the original article by clicking here.

Restaurant prices keep increasing some are using stickers on the menu

Rev 6:6 NAS “And I heard something like a voice in the center of the four living creatures saying, “A quart of wheat for a denarius, and three quarts of barley for a denarius; and do not damage the oil and the wine.”

Important Takeaways:

  • Prices Are Going Up So Fast at This Restaurant They’re Using Stickers on the Menu
  • To fathom just how rampant inflation now is in some corners of the US, duck into the Miami River Café, a Mexican place in the city’s East Little Havana district.
  • A quick scan of the restaurant’s Facebook posts lays out the increases. The special, offered every Wednesday and Friday, had been $1 per taco for years. That changed in February of last year, when it was raised to $1.25. A month later, it went to $1.50. This January, it shot up to $1.75. And now it’s $2.00.
  • It’s not the prices on the menu so much that’ll shock you. It’s the fact that the prices were scrawled in pen on stickers slapped on the menu.
  • The last time I saw stickers on menus, I was in Venezuela covering an economy ravaged by hyperinflation.

Read the original article by clicking here.

Hyperinflation in Venezuela has prices going up 80% every month

Rev 6:6 NAS And I heard something like a voice in the center of the four living creatures saying, “A quart of wheat for a denarius, and three quarts of barley for a denarius; and do not damage the oil and the wine.”

Important Takeaways:

  • Venezuelans Throw Worthless Money in Trash Amid Massive Inflation
  • “As Venezuela sinks deeper and deeper into the first hyperinflation the Western Hemisphere has seen in a generation, bolivar banknotes have come to be worth basically nothing,”
  • Caracas Chronicles news website said 20-bolivar bills were once worth about $2 US each but are now equal $0.0001
  • Prices on goods go up about 80 percent every month
  • “Rule No. 1 of surviving hyperinflation is simple: Get rid of your money,” The second you’re paid, you run out as fast as you can to buy something — anything — while you can still afford it. It’s better to hold almost any asset than money, because assets hold their value and money doesn’t.”
  • The country experienced an economic collapse in 2014 under its socialist government and has not rebounded. There are shortages of food, medicine, and basic necessities throughout the country.

Read the original article by clicking here.

Diesel shortages paralyze Venezuelan farms, prompting sanctions debate

By Luc Cohen and Keren Torres

TUREN, Venezuela (Reuters) – Venezuelan farmer Agustin Zenere should have been planting corn by the second week of May – a crucial task in the economically devastated South American country where 7 million people are food insecure.

Instead, his 30-hectare (74-acre) plot of land in the breadbasket town of Turen was still covered with the brown, shriveled leaves of a sesame crop he could not harvest in time because the government had not given him enough diesel to run his tractors.

Diesel shortages have grown acute in the once-prosperous OPEC nation since late last year, when the United States ended an exemption to its crippling sanctions on state oil company PDVSA – aimed at ousting President Nicolas Maduro – that had allowed it to swap crude oil in exchange for imported diesel.

With farmers warning they may not have the fuel needed to plant staple corn and truckers sounding the alarm about difficulty transporting food, aid groups and some U.S. Democratic lawmakers have pressed President Joe Biden to end the ban on swaps.

Venezuela is mired in a humanitarian crisis after years of hyperinflation and recession, prompting millions to flee. Just 60% of the 36 kilograms (79.4 lbs) of food the Venezuelan diet requires on average per month was available in the country as of February, according to Edison Arciniega, executive director of non-governmental organization Citizenry in Action.

An opposition-conducted survey late last year found that 82.3% of Caracas residents said their income was insufficient to buy food for their family, and more than 5.4 million Venezuelans are now living abroad, according to the United Nations.

Critics, and many farmers, say sanctions are not the root cause of the shortages. PDVSA’s 1.3 million barrel-per-day (bpd) refining network is operating at a fraction of its capacity, leaving Venezuela – home to the world’s largest crude reserves by some measures – dependent on imported fuel.

Shortly after Venezuela received its last diesel cargo in November, the agriculture ministry began to ration the fuel – which is given away for free – to farmers. Soldiers now stand guard at service stations with lists of which farmers are able to fill up to 400 liters (106 gallons)- enough to run a tractor for a few days – into canisters on a given day.

“We cannot do anything if they give us one drop at a time,” said Zenere, 49, who invested $10,000 in the lost sesame crop.

Fields across Turen – in the center-west plains state of Portuguesa – are overrun with weeds that farmers need diesel-powered tractors to remove.

In the lush mountains of Cubiro in the western state of Lara, many producers have stopped planting tomatoes, peppers and onions because fuel shortages make it hard to transport crops to market, said Luis Colmenares, one of the few remaining truck drivers operating in the area. Some farmers gave away uncollected broccoli and lettuce crops to neighbors.

And at Marcos Mendoza’s Invernadero Tintorero greenhouses in Lara, pepper roots rot because customers do not have fuel to travel and pick them up.

Two farmers in the Turen area with relatively large plots told Reuters that they were able to obtain sufficient fuel by sending several family members to wait at different service stations.

So far, U.S. officials have said they are in no rush to lift sanctions and want to see Maduro take concrete steps toward holding free and fair elections.

Juan Gonzalez, senior director for the Western Hemisphere at the National Security Council at the White House, has suggested Venezuela is holding back diesel on purpose to manipulate public opinion against the sanctions.

“They try to paint it as a humanitarian situation, but they keep the diesel for the military and give it to Cuba, and leave the people to suffer to help their international argument,” Gonzalez told television channel EVTV Miami in March.

The U.S. State Department did not respond to a request for comment. The Treasury Department, which enforces sanctions, declined to comment.

Venezuela’s information, agriculture and oil ministries did not respond to requests for comment.

TWO MONTHS WAITING

The fuel shortages are the latest headache for Venezuelan farmers, who for more than a decade have struggled to import fertilizers and obtain credit due to hyperinflation and the fallout of widespread expropriations by Maduro’s predecessor and mentor, Hugo Chavez.

Maduro recognized the shortages and last month called on his government to improve fuel supply to farmers within 60 days. Farmers say they have not noticed any improvement, and that the existing rationing system is plagued by a lack of transparency leaving them unsure when or where they are supposed to fill up.

“You have to guess, you have to make a pilgrimage from service station to service station asking,” said Roberto Latini, 58, who last month lost 50 hectares of beans that he planted later than he wanted to because of a lack of diesel.

The shortages have raised concern among Venezuela’s opposition, whose leader Juan Guaido was recognized in 2019 by Washington and dozens of other countries as Venezuela’s rightful leader on the grounds that Maduro rigged his 2018 re-election.

The opposition has largely defended U.S. sanctions as necessary to prevent Maduro’s government from robbing state resources and to pressure him to the negotiating table.

Guaido’s representatives have proposed that the United States design a mechanism to allow diesel imports while ensuring Maduro does not use the fuel for corrupt ends, two people familiar with the matter said.

Any solution may come too late for Estanislao Wawrzyniak, 73, who received diesel last week for the first time in two months for his 60-hectare plot in Turen full of knee-high weeds.

“Two months waiting, without being able to do anything,” Wawrzyniak said, as two of his grandchildren used a tube to load diesel into a rusting tank held up on stilts, from a canister in the bed of a red pickup truck blaring electronic music.

Wawrzyniak plans to use the fuel to kill the weeds, and then he must wait several days before planting corn. Asked whether he would have time to plant before the rains picked up, he replied, “Only God knows.”

(Reporting by Luc Cohen and Keren Torres; Additional reporting by Efrain Otero and Matt Spetalnick; Editing by Marguerita Choy)

Venezuelans seek home care for COVID-19 amid crumbling health system

By Efrain Otero and Vivian Sequera

CARACAS (Reuters) – Venezuelan COVID-19 patients are paying doctors to come to their homes due to the high cost of private clinics and hospitals overflowing with patients and often lacking oxygen and medicine, doctors interviewed by Reuters said in recent weeks.

Family members tend to chip in or launch crowdfunding campaigns for infected relatives, said Laura Martinez, a 55-year-old resident of the lower middle-class Las Acacias neighborhood in western Caracas, whose husband and elderly parents were treated at home. Patients who receive home treatment for the coronavirus generally purchase respirators, oxygen tanks and anti-viral drugs.

President Nicolas Maduro’s government has said that the country, whose economy is mired in a brutal recession marked by hyperinflation, is experiencing a second wave of the virus. Official data have recorded around 1,000 new cases per day in recent weeks, though many health professionals warn the true toll is likely higher.

As the new wave gathered steam throughout March and April, home care, gained popularity thanks to word of mouth and social media. Such treatment often includes house calls, an option seen as a luxury in many developed countries but rendered cheap in Venezuela by a surfeit of underpaid doctors. Home visits cost $40-$80, depending on the severity of the patient’s symptoms, doctors said.

“It is the economic factor – without a doubt it is much cheaper for a doctor to visit one’s home,” Leonardo Acosta, a 25-year-old doctor, told Reuters in mid-April after a home visit in the capital Caracas.

“The cost of just being admitted to a clinic’s emergency ward is very high.”

Venezuela’s public hospitals frequently suffer from blackouts and routinely lack running water, according to medical associations who stage frequent protests over the inadequate conditions of the public health system.

Private clinics are better equipped but charge at least $1,500-$2,500 per night for inpatient care and as much as $5,000 per night for emergency care to treat acute respiratory problems.

That’s out of reach for the vast majority in a country where monthly minimum wage has not topped $5 in several years.

The information ministry did not immediately reply to a request for comment.

Patients are able to receive treatment at home as long as they do not require intubation, a delicate process that would require them to be transported to an intensive care unit, Acosta said.

For doctors, performing home visits means getting paid in U.S. dollars and making substantially more than they would in the public health system.

“I’m doing this in part for economic reasons,” said Carlos Hernandez, a 25-year-old doctor who like Acosta recently graduated from the Central University of Venezuela. He is also working in the public health system, as the country requires of recent graduates, but said he has not been paid in four months.

Given the country’s economic crisis, Acosta said he will often provide treatment even when the patient cannot pay in full.

“I understand the situation,” he said.

(Reporting by Efrain Otero, Vivian Sequera and Leonardo Fernandez; Editing by Lisa Shumaker)

Blackouts threaten death blow to Venezuela’s industrial survivors

Men work on the only operative production line at a food packaging plant in Valencia, Venezuela, April 8, 2019. Picture taken April 8, 2019. REUTERS/Ueslei Marcelino

By Corina Pons and Mayela Armas

VALENCIA, Venezuela (Reuters) – The latest power outage kicked off another tough week for factory owner Antonello Lorusso in the city of Valencia, once Venezuela’s industrial hub.

For the past month, unprecedented nationwide blackouts have paralyzed the factory and the rest of the country, cutting off power, water and cell service to millions of Venezuelans.

Lorusso’s packaging plant, Distribuidora Marina, had already struggled through years of hyperinflation, vanishing client orders and an exodus of employees.

But now the situation was worse.

For the whole month of March, Lorusso said his company produced only its single daily capacity: 100 tonnes of packaged sugar and grains.

When Reuters visited on April 8, he was using a generator to keep just one of a dozen packaging machines running to fulfill the single order he had received. Power had been on for a few hours, but was too weak to work the machines.

“There is no information, we don’t know if the blackouts will continue or not,” said Lorusso, who has owned the factory for over 30 years. He said the plant had just a day’s worth of power during the previous week.

Power has been intermittent since early March, when the first major blackout plunged Venezuela into a week of darkness. Experts and the opposition have called the government incompetent at maintaining the national electrical grid.

President Nicolas Maduro has accused the opposition and the U.S. government of sabotage.

Venezuelan industry has collapsed during six years of recession that have halved the size of the economy. What is left is largely outside of the capital Caracas, the only major city that Maduro’s government has excluded from a power-rationing plan intended to restrict the load on the system.

In Valencia, a few multinational companies like Nestle and Ford Motor Co hang on. But according to the regional business association, the number of companies based there has fallen to a mere tenth of the 5,000 situated there two decades ago, when Maduro’s predecessor Hugo Chavez became president.

‘THE GAME IS OVER’

The government said on April 4 that the power rationing plan meant Valencia would spend at most three hours a day without electricity.

But a dozen executives and workers there said outages were still lasting over 10 hours. Generators are costly and can only power a fraction of a business’s operations, they said, and many factories have shut down.

“The game is over. Companies are entering a state of despair due to their inviability,” said an executive of a food company with factories in Valencia, speaking on condition of anonymity.

Industrial companies this year are operating below 25 percent of capacity, according to industry group Conindustria. It estimated companies here lost about $220 million during the days in March without power, and would lose $100 million more in April.

Nestle’s factory, which produces baby food, halted production during the first blackout in early March and operations again froze two weeks later, with employees sent home until May, according to Rafael Garcia, a union leader at the plant.

He blamed the most recent stoppage on very low sales of baby food which cost almost a dollar per package, or about what someone earning minimum wage makes in a week.

“My greatest worry is the closure of the factory,” said Garcia, as he sat at a bus stop on Valencia’s Henry Ford Avenue, in the city’s industrial outskirts where warehouses sit empty and streets are covered in weeds.

Nestle, in a statement to Reuters, said it had “temporarily interrupted its manufacturing activities” at its Valencia factory due to a lack of demand and would resume production in May.

Ford’s plant had been operating at a bare minimum for several months, union leaders said. In December, the carmaker began offering buyouts to staff after it received no orders for 2019, they said. Ford had said in December it had “no plans to leave the country.”

The outages have idled more than just factories. In the countryside, lack of power has prevented farmers from pumping water to irrigate fields.

Since January, farmers have sown 17,500 hectares of crops – a third of the area seeded last year – and they fear losing the harvest due to the lack of water, according to agricultural associations.

In the central state of Cojedes, several rice growers have already lost their crops, farmers said.

“In the rural areas, the blackouts last longer,” said Jose Luis Perez, spokesman for a federation of rice producers.

Producers of cheese, beef, cured meats and lettuce told Reuters orders had dropped by half in March as buyers worried the food would perish once their freezers lost power in the next blackout.

Back in Valencia, Lorusso was preparing his factory for the new era of scarce power. He has converted one unused truck in his parking lot into a water tank. He plans to sell another to buy a second generator.

“We’ve spent years getting used to things. Then we were dealt this hard blow, and now we’re trying to find ways to cope,” he said.

(Additional reporting by Tibisay Romero in Valencia; writing by Angus Berwick; editing by David Gregorio and G Crosse)

Backstory: Reporting from the dark in Venezuela

Locals gather at a street food cart during a blackout in Caracas, March 29. REUTERS/Ivan Alvarado

(Reuters) – Backstory is a series of reports showing how Reuters journalists work and the standards under which they operate.

Two waves of major electricity outages plunged Venezuela into darkness last month, putting even more strain on a nation struggling with food shortages and hyperinflation.

With a diesel-powered generator in their Caracas bureau, Reuters staff are better-placed than most Venezuelans to cope with the blackouts.

But reporting from a darkened city and making sure all journalists and support personnel are safe present multiple obstacles.

“Everything will go down for a minute or two, the TVs and screens will turn off, then maybe a minute later, the power generator will kick in,” said Brian Ellsworth, Reuters senior correspondent in Caracas.

That is when the problems start.

No electricity means pumps do not work, leading to shortages of clean water. Cell networks cannot operate, meaning mobile phones are useless. Bank networks go down. Transport is unpredictable.

“At first, we weren’t totally prepared for it,” said Ellsworth, who has come to accept short outages as normal after 15 years reporting in the country’s capital.

Once it was clear that March’s first blackout would be longer than usual, the bureau immediately stocked up on water and bought food for the team as payment systems collapsed.

Only the bureau has a generator, not the building it is housed in, which makes getting into the office more complicated. To make it easier, a staff member slept in the newsroom most evenings, opening the emergency staircase from the inside so reporters could start work early the next day.

Gathering the news gets more difficult to coordinate.

“Cell reception comes in and out. We can make calls over WhatsApp but we can’t call anyone in the country because no one has a functioning cell line,” Ellsworth said. “We have to rely on short-wave radios which function to about 3 km (1.9 miles), but that can be really fuzzy.”

UNCERTAINTY CLOUDS EVERYTHING

With phones unusable, Venezuelans are cut off from one another and from sources of news and social media.

Ellsworth reported on a rally in eastern Caracas to protest President Nicolas Maduro’s handling of the nation’s crisis.

“How did you know about the rally?” he asked one protester. The answer: she did not. She was looking for her mother. “When I got to her building, they told me she was here, so that’s why I came.”

Hospitals cannot perform some vital functions without electricity. Already scarce food starts to spoil. Schools are closed during power outages, which means looking after children becomes an added burden.

“All of that affects us as a bureau because people have to take care of their own homes,” Ellsworth said. “We try to make sure that all those folks have what they need,” he said.

During busy news periods, the Reuters team in Caracas can include as many as 25 people, from reporters, photographers and television staff to security, cleaning and transport crews. The bureau also tries to provide meals for the building’s security guards who are not formally linked to the company.

“They have the same problems, they are stuck here for 24 hours, and when they leave here they don’t know how they are going to get home, if they will have power at home. They don’t have a way to communicate with their families,” said Ellsworth.

“Reuters needs to look out for people that are helping us maintain the operation.”

Maduro and ruling Socialist Party officials have offered a wide range of explanations for the blackouts, including electromagnetic sabotage by the United States and opposition-linked snipers firing on the country’s main hydroelectric dam.

Opposition leader Juan Guaido, who is recognized by most Western nations as the country’s head of state, says it is the result of a decade of corruption and mismanagement.

As Ellsworth walks up seven flights of stairs to his family’s apartment to light candles in the darkness, he reflects on the state of uncertainty he and 2 million other inhabitants of Caracas now face as a matter of course.

“They don’t give clear answers as to when power is going to come back on, people don’t really believe them when they say the power’s about to come back on, and when it is back, people don’t really believe it will stay back on,” he said. “The uncertainty starts to cloud everything.”

(Writing by Bill Rigby; Editing by Howard Goller)

Venezuela congress declares ‘state of alarm’ over blackout

People collect water released through a sewage drain that feeds into the Guaire River, which carries most of the city's wastewater, in Caracas, Venezuela March 11, 2019. REUTERS/Carlos Garcia Rawlins

By Shaylim Valderrama and Anggy Polanco

CARACAS/SAN CRISTOBAL, Venezuela (Reuters) – Venezuela’s opposition-run congress on Monday declared a “state of alarm” over a five-day power blackout that has crippled the OPEC member country’s oil exports and left millions of citizens scrambling to find food and water.

Much of Venezuela remained without power on Monday, although electricity had largely returned to the capital of Caracas following an outage that began on Thursday and which President Nicolas Maduro has called an act of U.S.-backed sabotage.

The outage has added to discontent in a country already suffering from hyperinflation and a political crisis after opposition leader Juan Guaido assumed the interim presidency in January after declaring Maduro’s 2018 re-election a fraud.

Venezuelan citizens living in Bogota protest against Venezuela's President Nicolas Maduro and the continuing power outage in Venezuela, in Bogota, Colombia, March 11, 2019. REUTERS/Carlos Julio Martinez

Venezuelan citizens living in Bogota protest against Venezuela’s President Nicolas Maduro and the continuing power outage in Venezuela, in Bogota, Colombia, March 11, 2019. REUTERS/Carlos Julio Martinez

“Nothing is normal in Venezuela, and we will not allow this tragedy to be considered normal, which is why we need this decree of a state of alarm,” said Guaido, who heads the legislature, during the session on Monday.

The constitution allows the president to declare states of alarm amid catastrophes that “seriously compromise the security of the nation,” but does not explicitly say what practical impact such a declaration would have.

Guaido has been recognized as Venezuela’s legitimate leader by the United States and most Western countries, but Maduro retains control of the armed forces and state institutions, and the backing of Russia and China, among others.

Oil industry sources said that exports from the primary port of Jose had been halted for lack of power, cutting off Venezuela’s primary source of revenue.

During the legislative session, Guaido called for a halt in shipments of oil to Maduro’s political ally Cuba, which has received discounted crude from Venezuela for nearly two decades. The deals have drawn scrutiny from the opposition and its allies abroad as Venezuela’s economic crisis worsened.

“We ask for the international community’s cooperation to make this measure effective so that the oil the Venezuelan people urgently need to attend to this national emergency is not given away,” Guaido said.

U.S. National Security Advisor John Bolton backed the measure, writing on Twitter that, “insurance companies and flag carriers that facilitate these give-away shipments to Cuba are now on notice.” He did not specify any measures the U.S. government may take.

Earlier on Monday, the U.S. Treasury imposed sanctions on a Russian bank over its dealings with Venezuela’s state-owned oil company PDVSA and Secretary of State Mike Pompeo criticized Russia’s Rosneft for buying PDVSA oil.

People collect water released through a sewage drain that feeds into the Guaire River, which carries most of the city's wastewater, in Caracas, Venezuela March 11, 2019. REUTERS/Carlos Garcia Rawlins

People collect water released through a sewage drain that feeds into the Guaire River, which carries most of the city’s wastewater, in Caracas, Venezuela March 11, 2019. REUTERS/Carlos Garcia Rawlins

RESTORATION ‘COMPLEX’

The blackout has left food rotting in refrigerators, hospitals have struggled to keep equipment operating, and people have clustered on the streets of Caracas to pick up patchy telephone signals to reach relatives abroad.

On Monday, Venezuelans seeking water formed lines to fill containers from a sewage pipe.

“This is driving me crazy,” said Naile Gonzalez in Chacaito, a commercial neighborhood of Caracas. “The government doesn’t want to accept that this is their fault because they haven’t carried out any maintenance in years.”

Venezuela’s electrical grid has suffered from years of underinvestment. Restrictions on imports have affected the provision of spare parts, while many skilled technical personnel have fled the country amid an exodus of more than 3 million Venezuelans in recent years.

Winston Cabas, the president of an electrical engineers’ professional association, told reporters that several of the country’s thermoelectric plants were operating at just 20 percent of capacity, in part due to lack of fuel. He said the government was rationing electricity.

The process of restoring service was “complex” and could take between five and six days, he said.

“We once had the best electricity system in the world – the most vigorous, the most robust, the most powerful – and those who now administer the system have destroyed it,” he said.

A source at PDVSA also said the government had decided to ration electricity, in part to supply power to the Jose oil export terminal.

The Information Ministry did not respond to a request for comment.

Experts consulted by Reuters believe the nationwide blackout originated in transmission lines that transport energy from the Guri hydroelectric plant to the Venezuelan south.

The lack of electricity has aggravated a crisis in Venezuelan hospitals, already lacking investment and maintenance in addition to a shortage of medicines.

School and work activities are set to be suspended on Tuesday, the third working day in a row.

(Reporting by Shaylim Valderrama, Vivian Sequera, Anggy Polanco, and Deisy Buitrago; additional reporting by Sarah Marsh in Havana; writing by Daniel Flynn, Brian Ellsworth and Luc Cohen; editing by Grant McCool and Rosalba O’Brien)

Venezuela grinds to a halt as blackout drags into a second day

A general view of a street during a blackout in Caracas, Venezuela March 8, 2019. REUTERS/Manaure Quintero

By Vivian Sequera and Brian Ellsworth

CARACAS (Reuters) – Venezuela shut schools and suspended the workday on Friday as the worst blackout in decades paralyzed most of the troubled nation for a second day, spurring outrage among citizens already suffering from hyperinflation and a crippling recession.

Power went out late on Thursday afternoon due to a problem at Venezuela’s main hydroelectric plant, the government said, calling the event an act of “sabotage” by ideological adversaries.

“We will once again defeat this electrical sabotage. We are going to recover this important service for the population,” Vice President Delcy Rodriguez said in comments broadcast over state television.

While blackouts are routine in many Venezuelan provinces, particularly along the western border with Colombia, nationwide power outages under the ruling Socialist Party have never extended for more than a day.

“This is a severe problem. It is not just any blackout,” said Luis Martinez, a 53-year-old construction worker walking to work in eastern Caracas.

Reuters witnesses could only confirm that lights were on in the southern city of Puerto Ordaz. It was not immediately clear if the power shortages affected oil operations in the OPEC nation.

State oil company PDVSA did not immediately respond to a request for comment.

In Caracas, scores of people walked through the streets early in the morning due to the closure of the metro, while others took the few buses that were circulating. Many did not realize the workday was suspended because they could not watch television or listen to the news.

SABOTAGE

President Nicolas Maduro always attributes major power outages to sabotage by opposition adversaries.

Maduro, who was re-elected last year in a vote widely viewed as fraudulent, blames the crisis on a U.S.-backed sabotage campaign.

His critics say his government has mismanaged the power sector since late socialist leader Hugo Chavez nationalized it in 2007 while setting aside billions of dollars for power projects that were swallowed by corruption.

Opposition leader Juan Guaido slammed the government for bungling the country’s energy supply and dismissed sabotage accusations.

“Sabotage is stealing money from Venezuelans. Sabotage is burning food and medicine. Sabotage is stealing elections,” he wrote via Twitter, referring to humanitarian aid trucks that went up in flames last month when opposition leaders attempted to bring relief supplies across the Colombian border.

More than 3 million people are believed to have fled Venezuela amid a deep economic crisis marked by shortages of food and medicine and hyperinflation.

Venezuela suffered major blackouts in 2008 and 2013 that affected significant parts of the country, but both were resolved in less than six hours.

Maduro’s televised speeches have on several occasions been interrupted by power outages, spurring chuckles from opposition critics.

Local power outages continue to be chronic, particularly in the sweltering western state of Zulia where residents complain of days without power or with limited electricity and voltage fluctuations that damage appliances.

Venezuela is mired in a major political crisis, with more than 40 foreign governments disavowing Maduro in favor of Guaido. The United States in January levied crippling oil industry sanctions meant to starve Maduro’s government of revenue.

Maduro says Guaido is a “puppet” of Washington and dismisses his claim to the presidency as an effort by the Trump administration to control Venezuela’s oil wealth.

(Reporting by Vivian Sequera and Brian Ellsworth,; Editing by Daniel Flynn, Chizu Nomiyama and Jeffrey Benkoe)

Warding off hunger, Venezuelans find meals in garbage bins

A man sits on a rubbish container in Caracas, Venezuela February 26, 2019. Picture taken February 26, 2019. REUTERS/Carlos Jasso

By Shaylim Valderrama

CARACAS (Reuters) – Tony, a 36-year old security guard, rummages through the garbage bins of a wealthy district in Caracas on his days off work, scavenging for food as Venezuela’s economic meltdown has left even the employed struggling to find enough to eat.

“I smell it and if it smells good, then I take it home,” said Tony, who declined to disclose his last name because he does not want his wife and four children to know how he has been putting food on their table for more than a year.

He said he typically finds scraps of meat, cheese and pieces of vegetables on his garbage runs. “I wash it with vinegar, a lot of water, and I add onion and sauce.

Scenes of Venezuelans picking through garbage in a search for something to eat has for years been a symbol of the nation’s economic meltdown, which has been marked by widespread shortages of food and medicine as well as hyperinflation.

But the problem received renewed attention this week after the South American nation’s socialist government deported American journalist Jorge Ramos, who showed a video of people eating garbage while he interviewed President Nicolas Maduro.

Maduro, who has been in power since 2013 and was re-elected last year in a vote widely viewed as fraudulent, has previously dismissed journalists’ questions about garbage consumption, saying they were part of a U.S.-backed propaganda campaign against his government.

He denies there is a humanitarian crisis in his country and says foreign governments are seeking to undermine him.

Venezuela’s Information Ministry did not immediately reply to a request for comment.

It is not uncommon for poor and indigent residents of the world’s wealthiest nations to root through dumpsters. But it is rare in those nations for people with full-time jobs to rely on garbage to sustain their families.

Prices in Venezuela are rising more than 2 million percent per year, and the country’s minimum wage, worth around $6 per month, buys little more than a tray of eggs.

Many Venezuelans rely on remittances from relatives who have joined an exodus of an estimated 3.4 million people since 2015, according to the United Nations, while others depend on government food handouts.

Opposition leader Juan Guaido, who in January declared himself to be Venezuela’s interim president, led an effort last week to bring humanitarian aid into the country, but troops blocked trucks from getting in.

Most Western nations including the United States have recognized Guaido as Venezuela’s legitimate president.

“I’ve had to teach my children to eat everything,” said Estefani Quintero, 35, a mother of seven who travels two hours to Caracas from a distant suburb to trawl garbage bags. “Of course it’s the government that’s at fault for this. We used to eat breakfast lunch and dinner, we even threw away food.”

(Reporting by Shaylim Valderrama; Writing by Sarah Marsh and Brian Ellsworth; Editing by Paul Simao)