By Eyanir Chinea
CARACAS, July 11 Venezuela's central bank said
on Thursday it will sell $200 million at auction under its
revamped currency exchange system, as the government seeks to
boost the flow of dollars to importers and address voters'
complaints about nagging product shortages.
The bank said that $170 million would be allocated to
businesses and $30 million to individuals in the auction under
the revamped system, known as Sicad.
The auction would begin on Friday and end on Tuesday, it
said, adding that only companies registered in eastern Nueva
Esparta state and western Falcon state, and firms in the
automotive and health sectors would be allowed to take part.
The businesses can place orders with a minimum value of
$8,000 and a maximum of $1.02 million. Individuals traveling
abroad can request between $500 and $2,500.
The auction results will be compiled and announced on
Wednesday, the central bank said, and dollars will be paid out
on July 19.
The Sicad system, which operates in parallel with a
decade-long currency control mechanism, will provide dollars at
a higher rate than the official exchange rate of 6.3 bolivars.
That will further weaken the bolivar after a devaluation in
February helped push annualized inflation to almost 40 percent.
It will be the second Sicad auction and follows one in March
when $200 million was sold - representing a fraction of
Venezuela's monthly import bill.
Since then, the authorities have revamped the system and
plan to hold at least two auctions a month while also cutting
some of the red tape that business leaders say is cumbersome.
The bank did not give an expected price range for the
auction, but local economists forecast Sicad will sell dollars
at around 15 bolivars each - more than twice the official rate
but around half the price that greenbacks fetch on Venezuela's
Speaking in Venezuela's eastern oil city of Maturin, Energy
Minister Rafael Ramirez said state oil company PDVSA would sell
some of its dollars via Sicad. Of every 10 dollars that enters
Venezuela's economy, nine come from PDVSA's oil exports.
The changes to Sicad move Venezuela toward a more
market-based economy after vast expansion of state control
during the 14-year rule of the late socialist leader Hugo
President Nicolas Maduro, who won an April election after
Chavez's death from cancer, faces so-called stagflation as the
economy slows and consumer prices rise.
Venezuelan businesses have complained for months that lack
of access to hard currency has stopped them from importing
consumer staples ranging from wheat flour to toilet paper.
Importers of consumer staples will not be allowed to buy
dollars in the upcoming auction, but they are expected to be
permitted to do so in later auctions.