Red tape congests motor trade in Venezuela

The nightmarish traffic jams that blight Venezuelan cities are testament to the roaring trade that has been done in the local car industry in recent years. But new rules that 30 per cent of cars sold from next April must have dual natural gas and petrol tanks are the latest in a raft of problems confronting the sector. “It’s a very ambitious target. I’m not aware of anywhere else in the world where there is such a high proportion of cars running on gas,” says Antonio Martínez, acting president of the Venezuelan Automotive Chamber, who doubts whether the industry can be ready so soon. The government was this week forced to revoke a decree stipulating that all new cars should have dual tanks from July, having already postponed it from January. Switching cars from petrol to natural gas would enable the government to spend less on petrol subsidies, which are estimated to drain $10bn-$12bn (€6.4bn-€7.6bn, £5.1bn-£6.1bn) from export revenues this year. But economists point out that unless petrol prices are increased – which President Hugo Chávez recently said he had no plans to do in the near future – there will be little incentive for drivers to switch to less efficient natural gas. Venezuela has some of the world’s cheapest petrol, at just 3-4 cents a litre.