The accelerated increase in prices of food and services which has been experienced in recent weeks in the state of Táchira, creates great uncertainty among the inhabitants of the Andean region, especially after the vehicular opening of the border through the Atanasio Girardot Bridge, better known as”Las Tienditas” Bridge).
By La Patilla – Luz Dary Depablos
Jan 15, 2023
However, on the other three international bridges that link Táchira State (Venezuela) with Norte de Santander Department (Colombia), the transit restrictions imposed by Nicolás Maduro’s regime remain.
The economy in Táchira, that not only depends on the national economy, has historically also been subject to what is happening in Norte de Santander, Colombia, where inflation continues to rise today.
For the Tachirense economist Aldo Contreras, with the economic recession that is looming in most of the countries of the world just because their economies are not growing as they did before the pandemic, one must add the increase of inflation and the fall in Gross Domestic Product, “Venezuela is one of the few countries that are still growing, 7.5% according to the International Monetary Fund.”
Mr. Contreras estimates that Venezuela could register “a growth of more than 10% by 2023, after clearly stating that the economy still does not have the size of 2012, when its size was about 450 billion dollars (GDP).”
He explained that “according to the IMF, Venezuela closed 2022 with (a GDP) of about 65 billion dollars, and this 2023 could reach or exceed 73 billion dollars. That means that it has to grow for 10 years at this rate of between 10% and 20% per year to reach the (GDP) size we had in 2012. You have to understand that we are far away in figures.”
Regarding the opening of the border for commerce, he has no doubt that Colombia continues to be the greatest beneficiary, due to “the obstacles” faced by those who aspire to export any item to Colombia, that’s why he estimates that “commercial exchange could reach about 1,500 million dollars in 2023,” favoring Colombia by more than 75%.
Trade Imbalance
“Under the current perspectives, Colombia would be exporting some 1,200 million dollars in 2023 and Venezuela would only export some 300 million dollars, because Venezuela has not yet become competitive in terms of prices and costs, all this caused by the imbalances that it still presents and the economic obstacles,” he said.
Likewise, he stated that the Colombian peso in recent months presented a depreciation of more than 25%, which has generated an increase in inflation in the neighboring country, which in turn “affects the purchasing power of Venezuelans, especially in the border states where salaries are fixed to Colombian pesos.”
Therefore, the pocket of the people in Táchira will continue to be hit by the increase in inflation, since it will become increasingly difficult to access the basic (food) basket with devalued wages.
As for customs agents, loading and unloading companies would be benefiting from the commercial opening, by generating new jobs and this would allow a different dynamism in the border municipalities, obviously far from what it was before the blockade by this regime.
He does not rule out that during this month, the San Sebastián Fair and tourism packages to the island of Margarita will attract Colombians, but “there are 14 “alcabalas” (checkpoints) in only 25 kilometers from the binational crossing to San Cristóbal, which I was able to verify and this generates uncertainty, nervousness and fear of Colombians,” the economist stated.
Dollars Through The Roof
For the economist and former president of “Fedecámaras” (Federation of Chambers of Commerce) in Táchira, José Rozo, the impact of the full activation of commerce, services and manufacturing industry in the border municipalities: “does not depend on whether or not international bridges are open, the full activation it depends on internal macroeconomic policies.”
“The Ureña Sugar Mill, known as the “Táchira Sugar Mill” (Cazta), a thriving company in the region that generated some 3,500 direct and indirect jobs, not counting the jobs created on the Colombian side, because as is known, this mill also processed the sugar cane produced in Norte de Santander, and which was confiscated in the time of the late former President Chávez, is today in ruins and is practically unrecoverable,” he explained.
“Local commerce does not have anything to fill its windows with since a large part of the companies in the interior (of the country) are closed. And there is a small detail: in Venezuela there are no longer cheap (subsidized) dollars and this exchange maneuver that allowed it to compete with Colombian products is over.
This also affects the industrial sector, since exporting companies do not have that cheap or subsidized dollar, which made them competitive in the Colombian market, said Rozo.
With Empty Pockets
In his opinion, with the reopening of the bridges there are small sectors that will benefit, such as customs services and public transport when it is reactivated.
“We must remember that around 6 million people, between retirees and pensioners, earn 7 dollars a month, which is not even enough for half a meal, much less to buy a 10 dollar bluejean. If there is no purchasing power, there is no reactivation of production, and this does not depend on bridges or politicking or border charlatanism.”
“Colombians who have gone to San Cristóbal return scared: 4 chicken thighs in El Sambil cost almost 11 dollars, that is, 50 thousand pesos, which is what a complete chicken with potatoes and soft drinks costs there (Colombia), and they have plenty of money,” he said.
Mr. Rozo remarked that “the ruin” in the border municipalities “was not the product of closing the bridges, but rather due to the application of the ruinous policies of the “Bolivarian Project, the Bolivarian and Socialist Process.”
“Today, Venezuela does not have an economic model, it was destroyed. In 1983, we had surmountable economic crises. Today, the problem in Venezuela is not economic, it is political. There is an urgent need for a regime change, to replace a political model for a model of free economy, free market, free enterprise, decentralized, civil and democratic,” asserted Rozo.
“What we must rescue in the short term is freedom and democracy to have the bonanza that we could envision and it was taken from us,” he concluded.
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