BOGOTA Feb 12 Colombia's government is worried
the devaluation of the Venezuelan currency may push more
contraband across its border, the finance minister said on
Tuesday, adding to the flow of Venezuelan goods already smuggled
into neighboring Colombia.
"We cannot allow that as a result of devaluation in
Venezuela, we are flooded by contraband in the Colombian
market," Finance Minister Mauricio Cardenas said on local
Venezuela devalued its bolivar currency by 32 percent
last week, the country's fifth devaluation a decade, making
Venezuela's exports cheaper for foreign customers.
Wide-ranging Venezuelan price controls on consumer goods
have already driven gangs to smuggle fuel, meat and appliances
into the Colombian border area, where they were cheaper than
domestically made Colombian goods.
The devaluation will make that contraband even cheaper when
priced in Colombian pesos.
The devaluation, which takes effect on Wednesday, was
announced Friday before a four-day weekend in Venezuela to
minimize political or market repercussions. It had been widely
forecast by economists as a way of redressing distortions.
Tensions between Colombia and left-wing neighbor Venezuela
have eased considerably since President Juan Manuel Santos took
office in 2010. The thawing ties have boosted cross-border trade
- which slumped when Venezuela's leader broke off ties in 2008.
Excluding off-the-books trade, Colombia ran a trade surplus
with Venezuela of around $2 billion in the January to November
period last year, according to the latest data, rising from $1.2
billion in all of 2011 and $1.1 billion in 2010.