Venezuela is experiencing a severe cash shortage, with inflation of 1,000,000% just this year. Some estimates say it might even be worse. One of the easiest ways to see what this is doing to daily life is breaking down the cost of a cup of coffee.
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Less than two years ago, the price was 450 bolivars. According to Bloomberg’s Cafe Con Leche Index, just a few months ago, the price was 190,000 bolivars. Last week, it rose to 1,400,000, and it’s currently sitting at a staggering 2,000,000 bolivars. This puts the three-month increase rate at 1,227,638%. These numbers show that Venezuela’s economic crisis is one of the worst ever, leaving many to wonder how to fix this extreme problem.
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In 2018 alone, President Nicolas Maduro has raised the minimum wage four times, peaking at 5 million bolivars. Sadly, this is still barely enough for a couple cups of coffee, let alone other living essentials. Experts say that reducing fuel subsidies could seriously help, but the administration has yet to try this. Instead, they’re planning on removing five zeros from their currency, up from a planned removal of three. Maduro said of this new currency, “The monetary reconversion will start on August 20th.”
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Updates show that this has been delayed, but they still plan on removing the zeroes. The severe increase can be seen in the image above. The IMF, or The International Monetary Fund, released a report this week that show the country’s GDP, or gross domestic product, will plummet a total of 18% this year. And this is nothing new, with these numbers getting worse since 2015. Watch the video below to learn more about the cash crisis…