The Editors of Veneconomy take a look at the real inflation numbers in Venezuela and find that the basic food basket now costs more than the minimum wage.
One of the many nightmares Venezuelans live daily is the high cost of living, which eats away at their wages and prevents them from meeting their basic needs. Not in vain do people comment that the government’s inability to control inflation will finally gobble up Hugo Chávez’s pseudo revolution.
Even though at the time of going to press on Wednesday, December 3, the Central Bank had still not published its inflation estimates for November, the Venezuelan Teachers Foundation’s Documentation and SocialAnalysisCenter (Cendas-FVM) had published the figures for its Basic and Food Baskets.
Cendas has been publishing cost-of-living figures since the end of the 90s and they are currently some of the most objective in the country. Today they give an idea of the story the Central Bank’s figures will tell in a few days’ time.
According to Cendas, the Basic Basket, which includes, among other things, food, clothing, footwear, housing, health, and miscellaneous services, rose by 2.7% (Bs.F.86.68) between October and November, giving a cumulative increase for the year to date of 31.8%. Meanwhile, the increase for the last 12 months, November 2007-November 2008, was Bs.F.932.13 (38.7%), which brings the Basic Basket to the equivalent of 116% of the minimum wage (Bs.F.799.23).
Food was the item that suffered the biggest impact. Nine of the 11 food items included in this basket increased in price. Of those food items, the ones to suffer the biggest increases were grains (17.5%), one of the main staples of the country’s poorest sectors. Fruit and vegetables, essential for a balanced diet, rose by 10.1% and were the second hardest hit item in November. Three other important items also experienced increases: housing rents (3%), clothing and footwear (2.8%), and health 2.2%.
As for the Food Basket, Cendas reports an increase of 3.8% versus 2.8% in October. The increase in the Food Basket over the past 12 months was 46.9%, up Bs.F.502.49. This figure represents 62.9% of the minimum wage and nearly twice the figure posted (28.1%) between November 2006 and November 2007.
VenEconomy estimates that, by year-end, the increase in the Basic Basket will come to at least 42%, whereas the increase in the Food Basket will be more than 50%, up more than 15 percentage points from December 2007, when the Basic Basket closed at 25.6% and the Food Basket at 33.7%.
Meanwhile, the minimum wage has increased by only 23.07%.
Unfortunately, the outlook for 2009 is no more optimistic, particularly if account is taken of the fact that oil prices are spiraling downwards in the region of $40 per barrel.
Predictions for next year on the economic front bode no good for either Venezuelans or for Chávez and his revolution. Perhaps that is what is really behind the President’s haste to move full steam ahead with his totalitarianism.
No comments:
Post a Comment