Venezuela Crisis

venezuela crisis

Consider the following statements related to Venezuela.

  1. According to I.M.F. forecast, inflation rate in Venezuela is expected to be 1 million percent by December 2018.
  2. The North American country Venezuela’s economy is going through a crisis this time.
  3. Venezuela’s economy mainly depends on the export of edible oil.

Which of the above statement is/are correct?
(a) Only 1
(b) Only 2
(c) 1 and 3
(d) 1, 2 and 3
Answer- (a)
Related facts

  • The South American country Venezuela’s economy is currently undergoing crisis.
  • Lot of citizens has been forced out of the country due to excessive inflation, power cuts, food and a huge reduction in drugs.
  • It is important that Venezuela’s population is approximately 32.4 million, out of which 2.3 million people have left the country since 2014.
  • On average, prices of goods are doubling every 26 days.
  • Where inflation rate was 25000% in May 2018, at the end of June it increased to 40000%.
  • According to a recent study by the National Assembly in Venezuela’s opposition, the annual inflation rate was 83,000 percent in July 2018.
  • According to the International Monetary Fund (I.M.F.), the inflation rate in Venezuela is likely to be 1 million (1 million) percent till December 2018.
  • On the official exchange rate, 1 US dollar is approximately 248,000 Venezuelan Bolivars.
  • Venezuela’s economy mainly depends on revenues derived from the export of oil (petroleum). Its oil revenue, 95 percent of its export earnings.
  • This country is very rich in petroleum reserves.
  • Venezuela has faced a severe shortage of foreign currency due to a fall in oil prices in 2014.
  • On August 20, 2018, the government removed five zeros from the old ‘Strong Bolivar’ currency and gave it a new name ‘Sovereign Bolivar’.
  • This currency also starts with eight new bank notes (2, 5, 10, 20, 50, 100, 200 and 500) and two new coins.
  • It is notable that in Venezuela, from the year 2010 (from the reign of Hugo Chavez) the socio-economic and political struggle began, which is also continuing during the reign of current President Nicolas Maduro.
  • The economy is currently going through the worst phase in the history of Venezuela.

Reference:
https://www.bbc.com/news/world-latin-america-36319877
https://www.theguardian.com/world/2018/jul/25/venezuela-inflation-crisis-nicolas-maduro
https://www.nytimes.com/2018/08/06/world/americas/venezuela-maduro-crisis.html

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