January 7, 2016 / 11:13 PM / 4 years ago

Venezuela opposition seeks congress control of central bank

CARACAS (Reuters) - Venezuela’s opposition wants to use its majority in the new congress to bring the central bank back under legislative control in a first measure to try to influence economic policy, lawmakers said.

Julio Ygarza (L), Nirma Guarulla (C) and Romel Guzamana (2nd R), deputies of Venezuelan coalition of opposition parties (MUD), celebrate after their swearing-in ceremony during a session of the National Assembly in Caracas January 6, 2016. REUTERS/Marco Bello

President Nicolas Maduro eliminated, via decree, the National Assembly’s control over nomination and removal of central bank directors on the eve of the new legislature’s inauguration this week.

That outraged the opposition coalition, which beat the ruling Socialists in December elections to win two-thirds of congress in large part due to voter fury over the OPEC nation’s punishing economic crisis.

Now, opposition lawmakers are planning to reform the law again to overturn Maduro’s changes.

“It’s the first thing we are going to present (on economic matters), because it’s the most immediate and the easiest,” said Jose Guerra, an economist and former bank director expected to be on the new legislature’s finance commission.

Angel Alvarado, another opposition lawmaker expected to be on the commission, said the reform would also help control Venezuela’s inflation by limiting money-flows to the executive via legislative control of allocations.

Maduro last year said inflation would be near 100 percent in 2015 but the central bank has not published monthly figures for a year and private estimates put it close to 200 percent.

The opposition coalition says Maduro’s decree contravened the constitution, but any reform is likely to be appealed by the government at the Supreme Court which generally rules in its favor.

Opposition lawmakers want to pressure the bank into revealing data on inflation and gross domestic product, which has also not been published for a year. Maduro’s change this week allows the central bank to classify data considered a threat to national security or economic stability.

In a speech on Thursday, Venezuela’s leader acknowledged the depth of the economic crisis in a nation where shortages of basic products from milk to medicines have become common and long lines form daily outside supermarkets and other shops.

Maduro said government legislators would propose a decree to declare Venezuela in “economic emergency” on Tuesday. Though he has been promising measures for weeks, Maduro gave no more hints about the possible direction of economic policy this year.

He blames an “economic war” by foes and the fall in oil prices, but critics say Venezuela’s mess is the consequence of failed state controls and antagonism toward the private sector.

Reporting by Corina Pons and Andrew Cawthorne, writing by Andrew Cawthorne; Editing by Diego Ore and Tom Brown

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