CARACAS: Venezuelan President Nicolas Maduro said on Thursday the central bank could sharply increase the amount of dollars it offers at auction if lack of hard currency for businesses continues to cause economic problems next year.
The central bank says it has allocated a total of $859 million over the last seven months through four auctions of a new foreign exchange mechanism, known as Sicad, which is meant to complement decade-old currency controls.
The auctions are aimed largely at local importers who complain that lack of access to dollars has caused shortages of consumer goods ranging from flour and car parts to toilet paper.
During a televised meeting with the army's high command, the president said the central bank could offer more than $900 million every week, drawing loud applause from his audience.
"The dollars the fatherland needs to function are completely guaranteed, without problems, up to Dec. 31," Maduro said.
"If it goes beyond that, I've decided, perfecting Sicad, to offer via Sicad an amount of not less than $900 million a week to complement whatever needs the economy might have."
It was not clear what criteria would trigger the much larger and more frequent auctions, and Maduro gave no other details.
Trade groups representing business sectors given priority to receive funds in the Sicad auctions so far say they have no idea where most of the $859 million went.
The government says currency controls - a cornerstone of Venezuelan economic policy since 2003 - have been exploited for billions of dollars for fictitious exports by shell companies.
Set up by Maduro's predecessor Hugo Chavez to stop capital flight and inflation, the controls offer big profits for anyone who can buy dollars at a preferential rate and then resell them at some seven times that on the black market.
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