Juerg Degenmann, General Manager of Mudanzas Internacionales Global in Venezuela has advised that the social and business situation in Venezuela continues to worsen and that shippers and their customers should be aware of the position as a way of managing the expectations of assignees.

The country is experiencing regular power cuts despite the government’s recent efforts to reduce consumption by limiting the working hours of public sector employees.  The minimum wage in the country has recently increased by 30% which is expected to lead to increased salaries (and costs) in the private sector as well. There are shortages of basic food, medicines and personal care items.  People may only shop on specific days and must show ID to confirm that they are entitled to do so on that particular day.   “People line up at supermarket chains to see what they can find and go on from one supermarket to the next and so on,” he said.  “There is a scarcity of tires, batteries and spare parts that sometimes forces us to leave vehicles at the warehouse for weeks.”

Imports are at a record low level, because shipping lines are not calling at the ports, causing a problem with container availability for exports. Cargo airlines are overbooked forcing the use of European airlines to Europe and from there to different airports in Miami and others until shipments are sent to their final destination. This not only causes unnecessary delays but also considerable increases in freight rates.

Interest rates in the country are at 90% and inflation around 40%.  Prices quoted in local currency are valid only for 24 hours.  Invoices have to be paid immediately or the money is virtually worthless.  In addition to all these problems Venezuela is not a secure country and people are constantly in fear of kidnap or worse as they go about their daily work. Juerg said that the improvements expected some months ago did not appear.

Shippers are warned to expect delays and additional costs.  Mudanzas Internacionales Global in Venezuela is very experienced at working in the country and is still successful in providing a high quality, smooth service for clients despite the problems.  But Juerg says that the more people understand the situation the more realistic their expectations will be.