Global Food Crisis

Hungry Venezuelans Reaping Bounty of Oil Revenue

José Orozco in Caracas, Venezuela
for National Geographic News
June 9, 2008

Part eight of a special series that explores the local faces of the world's worst food crisis in decades.

At first glance, Venezuela's poor seem ill-equipped to handle the global food crisis that has sent the costs of even basic grains skyrocketing in recent months.

The country is strapped with South America's highest annual inflation rate, with food prices rising 36.2 percent in the 12 months before March, according to the Venezuelan central bank.

And the average Venezuelan family now spends 47 percent of its monthly income on food, said Luis Vicente Leon, director of the polling firm Datanalisis.

But under the socialist government of President Hugo Chavez, Venezuelans have access to heavily discounted foods—paid for by record oil revenues—making it possible for them to remain oblivious to the hardships in other poor countries.

"This is very cheap. That's why I put up with the lines," said Petra Blanco as she shopped for subsidized foods at a Mega Mercal in Pinto Salinas, a Caracas slum.

The government runs more than 10,000 Mercal food stores and about 13,000 mercalitos, or smaller shops, that sell subsidized foods to the poor. Chavez's administration also sets the prices for basic goods such as beef, chicken, milk, sugar, and rice.

For the equivalent of about U.S. $24.65, Andrea, who declined to give her last name, bought 3 chickens, 13 pounds (6 kilograms) of beef, 2 bags of pasta, and a package of powdered milk at the Pinto Salinas Mercal.

At a private supermarket, even at regulated prices, she says she could have bought only three packages of milk total for the same amount of money.

Deep Divides

But critics note that cheap subsidized foods are a double-edged sword, a necessity resulting from policies that create sporadic food shortages.

Subsidized foods depend on oil money, so Andrea—a critic of the government's policy—fears their availability will dwindle if oil prices fall from their near-record prices of more than $130 U.S. a barrel.

Continued on Next Page >>


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