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Venezuela's removal of 100 bolivar note causes chaos at banks

By Andrew V. Pestano
Venezuela's removal of 100 bolivar note causes chaos at banks
The Central Bank of Venezuela said it would issue new higher-denomination currency to aid residents dealing with inflation. President Nicolas Maduro would soon order the 100 bolivar bill -- which was the highest denomination before the bank's policy change -- out of circulation but the new bills have not been able to reach many consumers. Photo courtesy of Central Bank of Venezuela

CARACAS, Venezuela, Dec. 16 (UPI) -- Venezuela has officially pulled its 100 bolivar note out of circulation, which has caused disruptions for residents and long lines at banks.

The Central Bank of Venezuela, or BCV, earlier this month said it will issue new higher-value currency to aid consumers who are dealing with unprecedented inflation. Six new Venezuelan bolivar, or Bs., bank notes and three new coins were to enter circulation starting Dec. 8. The largest Venezuelan bolivar was the 100, which would be replaced by a 20,000 note.

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When the BCV made the announcement, it said all previous forms of payment would co-exist but President Nicolas Maduro last week announced he signed an emergency decree ordering the 100 bolivar banknote be removed from circulation by Friday.

This week, Venezuelans attempted to deposit their 100 bolivar banknotes before they were considered void. Some ATMs on Thursday were still issuing 100 bolivar bills and many could not receive the new banknotes the BCV previously announced.

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Maduro said the new higher denomination bills would be fully distributed in January. He said the measure was taken to battle "mafias" that hoard the cash mainly in Colombia but also Brazil.

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Maduro said an investigation revealed national banks were seeking to destabilize Venezuela's economies through a non-governmental organization contracted by the U.S. Department of Treasury.

Venezuela is going through an economic crisis exacerbated by a fall in oil prices, which has led to a shortage of basic goods -- including food and medicine. Goods are also unaffordable due to record-high inflation.

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The Venezuelan head of state has often accused the United States of working against the socialist government left behind by late former President Hugo Chavez. Maduro accuses the United States of supporting the Venezuelan opposition and corporations as part of an "economic war" against his administration.

Maduro on Thursday said he would extend the border closure with Brazil and Colombia -- closed since Tuesday -- for an additional 72 in another anti-"mafia" effort.

"And for today the government that just began to circulate the new bills and coins. Where are they? How much irresponsibility and ineptitude!" Henrique Capriles Radonski, governor of Venezuela's Miranda state and a key opposition leader, said in a statement on Thursday.

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