Venezuela’s Price Control Enforcer to Speculators: “The Fun is Over”

Mérida, June 17, 2013 (venezuelanalysis.com)– The president of the consumer protection agency that enforces government price controls, Eduardo Saman, has announced a tough new approach against price speculators, declaring, “Their fun is over”.

In an interview with state TV channel VTV on Sunday, Saman explained that the government’s Institute for the Defence of People in Access to Goods and Services (Indepabis) was to be “re-launched” on 20 June with a new strategic model to monitor businesses and sanction speculators.

The Venezuelan government maintains price controls on certain basic food, drink and domestic items in order to protect consumers from inflation. However some businesses often voilate these prices, selling products above the set rate, especially if shortages exist.

Further, an illegal practice exists where companies import products using government-issued dollars, currently priced at 6.3 bolivars per dollar and then sell these products at black market dollar rates of around 30 bolivars per dollar, making a sizeable profit in the process.

Indepabis president Saman said that his agency will put particular emphasis on combating this practice by sharing information with the government’s foreign exchange commission, CADIVI, about which companies import products using state-issued dollars.

Signs will also be placed in businesses that sell imported products using state-granted dollars to help make the public and Indepabis inspectors aware of their practices.

“Companies that sell their [state-granted] dollars and then sell their products at illegal prices are robbing the public and the country,” the Indepabis president affirmed.

Another strategy to be employed by the regulatory agency is to create a citizens’ network called “Friends of Indepabis”. These members of the public will act as a point of contact for Indepabis, notifying authorities if they encounter businesses breaking price control laws.

Indepabis will also improve its complaints phone-line, “so that it functions as it should”.

Anti-corruption measures

Meanwhile, Eduardo Saman announced a series of measures to tackle corruption within Indepabis and “purify” the organisation of corrupt officials. “We will be implacable with officials who sell out and betray the people,” he explained.

Saman was designated Indepabis president by Venezuelan president Nicolas Maduro last 11 June, after an alleged extortion ring was discovered operating inside the organisation.

Saman, who headed Indepabis from 2008-2009, is regarded as a more radical figure within Chavismo, and is known to take a hard line against private sector efforts to undermine government price controls and other economic measures to regulate the private economy.

To avoid corruption, all Indepabis inspectors have had their credentials suspended pending review. These official credentials will be renewed in the coming days by regional directors of the body, in an attempt to whittle out officials implicated in corrupt activities.

New regional directors of Indepabis were appointed in nine regional states over the weekend, after Indepabis’ director in Sucre state, Luis García, was detained on Friday under suspicion of involvement in illicit acts.

Further measures and details of Indepabis’ new strategic model to combat speculation and ensure compliance with price controls will be announced on Thursday.