PARALLEL DOLLAR CASE VENEZUELA

The Venezuelan economy has faced a deep crisis for over a decade, and although many government officials blame the "parallel dollar" for inflation and the loss of purchasing power, this narrative ignores the real structural causes of economic deterioration.

The parallel dollar —that is, the unofficial exchange rate that arises in informal markets— is more a consequence than a cause. Its existence reflects the loss of confidence in the bolívar, the prolonged exchange controls, and the scarcity of foreign currency in the official market.

The true root of the problem lies in erroneous economic policies, such as:

1. Uncontrolled money issuance without backing: The Central Bank of Venezuela has financed the fiscal deficit by printing money, which has skyrocketed inflation, even reaching hyperinflationary levels.

2. Price and exchange controls: Instead of stabilizing the economy, these controls have distorted the market, generated scarcity, and stimulated black markets.

3. Expropriations and destruction of the productive apparatus: Massive state intervention in key sectors reduced national production, increased dependency on imports, and weakened the private sector.

4. Corruption and mismanagement of resources: Despite high oil revenues in previous years, there was no sustainable investment or diversification of the economy.

In summary, the parallel dollar is a symptom of distrust and a poorly managed economy. Blaming it is a way to evade responsibilities over economic decisions that have undermined the monetary and social stability of the country.

"Man is not ignorant for being poor, but rather poor for his ignorance"