Maduro's confused signals bode ill for Venezuela's recovery

May 23, 2013 at 3:27 PM   |   0 comments

CARACAS, Venezuela, May 23 (UPI) -- Venezuelan President Nicolas Maduro is grappling with embarrassing shortages of consumer goods, in some cases rated to be worse than under Hugo Chavez, who died of cancer in March.

This week the National Assembly passed funding that could make toilet paper available to Venezuelans.

Maduro, who succeeded Chavez after a snap election in April, has pledged to solve Venezuela's endemic problems of shortages and slow growth and has also attempted to distance himself occasionally from Chavez.

Conflicting statements on Chavez's controversial legacy of an ongoing Bolivarian revolution have divided opinion within the ruling ranks, government and opposition media indicated.

Last week Maduro called for normalization of diplomatic ties with the United States, in defiance of Chavist hard-liners who remain suspicious of any softening toward Washington.

Maduro's aides are sensitive to reports highlighting problems such as empty shelves in supermarkets, while the opposition under Henrique Capriles is quick to capitalize on the government's alleged failings.

The $79 million state credit to the Ministry of Commerce will help ease shortages of toilet paper, toothpaste and soap, officials said. Opposition critics say Venezuela shouldn't have to import basic consumer goods and blame a collapse of local manufacturing. Officials counter that opposition elements in the economy are responsible for high prices and shortages.

Analysts say the shortages may be a business response to government efforts to control inflation and force shopkeepers to cut prices to barebones levels, affecting profit margins. Many consumer goods have disappeared from shelves as businesses try to obtain better prices to survive amid state controls.

Authorities warned businesses' hoarding of goods was illegal and would attract prosecution and severe punishments.

Rivalry between the Maduro loyalists and opposition campaigners ignited riots after his narrow election win in April and caused numerous casualties and property damage. At least seven people were confirmed killed and 61 injured in clashes between political rivals and between demonstrators and police.

Analysts said despite Maduro's assurances Venezuela faces a tough challenge fighting consumer shortages, profiteering and politically motivated turmoil in the economy. The government's attempts at state management of the economy are seen behind Venezuela, an oil-exporting nation, sinking to a recession for a third consecutive year.

Maduro went on a tour of Argentina, Brazil and Uruguay to secure more food supplies. Critics say the measures are stopgap and do not address deeper economic issues.

Opposition critics also queried the government's ties with Cuba amid charges that Communist Party old guard in the Caribbean country was seeking to influence Maduro's administration. Cuba is anxious that political change in Venezuela will be detrimental to its economy, which has benefited from cheap Venezuelan oil, cash handouts and state-backed support for Cuban migrants in Venezuela.

Maduro has yet to set out a clear strategy for the country's economic recovery. Critics say his statements about economic regeneration are confusing and haven't reassured Venezuelan business and industry skeptical of Maduro's contradictory pronouncements on the economy.

Reports that Chavist loyalists under Maduro are deeply divided over government strategy have also alarmed the business sector.

Capriles supports poverty reduction programs begun under Chavez but wants to cut off aid to Cuba, now said to run into several billion dollars, as well as cheap oil for Havana.

"We need that money to improve living conditions of Venezuelans, not to finance international politicking or propping the Cuban regime which abhors democracy," Capriles said during the April election, when he trailed Maduro by a narrow margin.

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