Venezuelans, already experiencing severe shortages of food and other consumer goods amid the country's worst economic crisis, are likely to feel even more pain as the year unfolds, the International Monetary Fund grimly predicts.
The South American country is “on a path to hyperinflation,” with economic activity “projected to contract sharply … while inflation is expected to accelerate further,” Alejandro Werner, the IMF's Western Hemisphere director, wrote in the organization's latest outlook for Latin America and the Caribbean.
Contributing factors include a large and growing deficit, “extensive economic distortions, and a severe restriction on the availability of imports of intermediate goods,” Werner wrote in the assessment posted Monday on an IMF website.
Maduro taps Sanguino to lead Central Bank
In an attempt to reverse Venezuela's declining fortunes, President Nicolás Maduro on Monday announced he'd appointed political ally and economist Ricardo Sanguino to lead the country's Central Bank. Sanguino is a member of the ruling United Socialist Party.
He replaced Nelson Merentes, who resigned Friday. The mathematician had investors' confidence until he oversaw “a massive expansion of the money supply that helped drive inflation to a reported 800 percent” last year, Reuters news agency reported.
Economist Jesus Casique told VOA it's hard to gauge the exact rates of inflation or economic contraction because the central bank “has the figures locked.” He suggested that by keeping such data secret, “the Central Bank of Venezuela has been repeatedly violating the constitution of the republic.”
The country's extensive oil reserves made it Latin America's richest nation in the 1970s. But with the 2014 collapse of oil prices, consumer costs and crime have surged. An Associated Press exposé last month found evidence that Venezuela's military -- which Maduro had put in charge of food distribution -- was profiting by seizing and reselling rice, corn flour and other staples at exorbitant rates.
Call for sanctions
Several members of the U.S. Congress this week are calling for U.S. sanctions against the food traffickers, including Venezuelan officials, the AP reported.
Opponents of Maduro's administration took to the streets of Caracas on Monday, the anniversary of dictator Marcos Perez Jimenez' 1958 removal and a restored democracy, to demand regional elections and a referendum on recalling Maduro. The president's supporters also staged countermarches.
VOA Latin America division's Carol Guensburg contributed to this report.