Let’s skip one of the most dangerous cities of Venezuela and let’s focus on the “touristic” side of the country if there’s any left. Let’s look at why Venezuela is such a cheap holiday destination for tourists. The short answer: Hyperinflation!
Margarita Island, Pearl of the Caribbean
Staying in a 4-star hotel on Margarita Island, breakfast, spa, pool, and super comfy bedrooms included, may cost $50 per night; a trip to the beach with chairs, umbrella, soda, food, and snacks for two people may cost $15, and if you feel generous you can invite a few friends and pay around $30 for the whole group. You can also get a decent meal in a restaurant for $3, and you can try eating on the street for $1.
Public transportation is so cheap that it is crazy to express it in dollars: a bus ride is $0.01 and a subway ride is $0.00002 (in Caracas).
If you want to take a taxi you would have to pay around $1 or $2 depending on the distance and hour of the day, of course.
Merida, Mountains and a Little Snow
Your budget for accommodation may go from $20 to $30 per night. Meals and entertainment are also available for a few small bills; cable car, mountain ride, great views and great food.
Enough with the advertisement, there is an idea behind this article: Why is it so cheap to go and spend some holidays in Venezuela?
Hyperinflation is the answer. Let me explain why…
Tackling Debt with Hyperinflation
Every time the Venezuelan Government has found itself deep in national debts to pay, they print more money. It is not even necessary to print actual bills or coins. They just ask the Central Bank to produce some extra digits in their accounts and voila, there’s money to pay public employees payrolls and Christmas bonus and more. Money that has no real equivalent in goods and services, and therefore no value.
I remember that a classmate once asked why it was that the government couldn’t just print more money to pay everybody more decent salaries. The teacher’s eyes almost dropped, but I guess that girl has some position in the Central Bank nowadays because what she once considered is now a regular business here. Hyperinflation processes have taken governments around the world to redenominate their currencies in order to eliminate some zeroes and ease transactions.
Bolivar Soberano: From “Strong” to “Sovereign”
A few days ago, President Maduro said we were going to change from the Strong Bolivar (Bolivar Fuerte) to the Sovereign Bolivar (Bolivar Soberano), taking three zeros from the actual unit. What I cannot understand is the poor excuse of “making our currency stronger” this way. We already had one redenomination in 2007 under Chavez’s administration and he said exactly the same. It was a strategy to fight the crisis and strengthen our Bolivar, yeah right.
So now, from June on, our monthly salary will be 400 Sovereign Bolivars, which is 400,000 actual bolivars, which in turn were 400,000,000 Bolivars in 2006. But don’t be fooled by zeros, it is still around $2 and you can buy two slices of pizza with it.
When hyperinflation hits a country, citizens prefer to save their money in other stronger currencies, such as the US Dollar. This increasing demand for greenbacks sets its price higher and higher; people are willing to pay more in order to change their bolivars into dollars. Right now, the unofficial exchange rate is around 250,000 Strong Bolivars per dollar.
Still Want to Come and Visit Venezuela?
- Do not change your money with government people, agents, banks or anything. It will lose around 70% of its value since the official (and legal) exchange rate is a joke.
- Find a friend who will buy your dollars, and give you bolivars (not legal but definitively worth trying).
- Find another friend with a local bank account to manage your money while on holidays. Cash is now something a rarity to find, you need a debit card.
Bottom line: once you have your airplane ticket and a local Venezuelan friend, there is nothing to worry about. Except maybe the crime rate; but you already knew about that, right?