Venezuelan state considers system to limit food purchases

CARACAS Tue Jun 4, 2013 12:09pm EDT

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CARACAS (Reuters) - A Venezuelan state is testing a system to limit purchases of food and other staples, local media reported on Tuesday, in a move that officials defended as necessary to stop contraband trade but opposition critics slammed as Cuban-style rationing.

The OPEC nation's consumers have for months had to endure long lines or visit several stores to find basic products that run the gamut from toilet paper to butter, driven in part by a lack of hard currency to ensure imports.

The state of Zulia in western Venezuela said it will launch a pilot program next week that uses a digital system to block shoppers from buying the same staple products at different stores on the same day.

"Considering the average size of a family, one person should only buy 20 staple products during the period that we establish, which we think will be one week," Blagdimir Labrador, an official with the Zulia state government, told the newspaper Panorama in an interview published on Tuesday.

Venezuela's price control system leaves the cost of basic products such as rice and flour considerably below their market value, creating a temptation for consumers to buy them in large quantities and resell them during shortages.

The business is even more lucrative in border states such as Zulia, which neighbors Colombia, because shoppers can buy goods and resell them across the frontier where they trade for several times the subsidized Venezuelan price.

Products to be covered by the system include rice, milk, toothpaste and diapers. The pilot program is to be carried out in 65 supermarkets in Zulia's capital Maracaibo and the neighboring municipality of San Francisco.

Supporters of the system credit the late leader Hugo Chavez for creating welfare programs that keep groceries cheap for the poor as part of his self-styled socialist revolution that his protege and designated successor Nicolas Maduro has vowed to continue.

Opposition leaders say the nagging shortages are a sign that the Chavez-era state-led model of price controls and frequent nationalizations is running out of steam. They sometimes compare the system to that

"We cannot allow the government to use our state to create a Cuba-style rationing system," said opposition legislator Elias Matta of Zulia. "This shows the failure of 21st century socialism."

(Reporting by Brian Ellsworth; Editing by Daniel Wallis and Paul Simao)

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