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Published On: Tue, Jan 10th, 2017

Colombia Won’t Open Border to Venezuela for Cars

nsnbc : Colombian Foreign Minister Maria Angela Holguin stated that Colombia won’t currently re-open its border to Venezuela for vehicles, citing the recent decision by Venezuela’s State oil company PDVSA to sell subsidized gasolin for foreign currency.

Venezuelans cross over to Colombia to purchase food and other basic goods in recent border opening (El Heraldo).

Venezuelans cross over to Colombia to purchase food and other basic goods in recent border opening (El Heraldo).

On December 29, 2016 Venezuela’s State oil company PDVSA announced that it would begin to sell gasolin for foreign currency at gas stations in Urena in Táchira and Paraguacho in Zulia State at stations near the Colombian border as of January 2, 2017.

The Venezuelan government and PDVSA described the sale of subsidized gasolin for foreign currency as a pilot project that, among others, aimed at undercutting the price of smugglers who were smuggling subsidized Venezuelan gasolin to Venezuela.

However, the initiative came also as Venezuela was withdrawing old Bs100 banknotes while the issuance of new banknotes fell well behind schedule. Caracas denounced border traders in Colombia who had accepted currency as “mafias”.

Colombia, for its part, complained over the fact that Colombian businesses who had been courteous to accept Venezuelan currency were stuck with banknotes that would become worthless.

Women shows stacks of 100 Bolivar bills. Courtesy (AFP).

Women shows stacks of 100 Bolivar bills. Courtesy (AFP).

It is noteworthy that Venezuela is plagued by hyperinflation and that Colombia’s economy has been retracting over 4percent last year. Colombia is, in other words, aiming at limiting the sales of subsidized or smuggled Venezuelan gasolin to bolster its own economy. Holguin commented on the Colombian government’s decision not to re-open the border for vehicles yet, saying:

“We are not going to open the border for cars, we are not going to change our position because President Maduro has taken the decision to sell gas on his side of the border… We took the decision to stop depending on Venezuela, and furthermore, we are not going to allow our side of the border to be filled up with contraband fuel. …  Before the closure the Cucuta border was chaos, there were illegal gas sellers all over the place. With the closure we have achieved almost complete control and are supplying the city with subsidized gas, a decision by the national government so as not to depend on Venezuelan fuel”.

Holguin conceded, however, that Venezuela’s decision to close its part of the border for period in 2016 contributed to stabilizing a notoriously unstable and “unruly” region. The land crossing to Colombia was re-opened in August 2016 after having been closed for almost 12 months on orders from Caracas as well as for a short period in December 206 while Venezuela withdrew its Bs100 banknotes and prevented many Colombian traders to cross the border to exchange their Venezuelan currency or to but Venezuelan goods instead.

A/N & CH/L – nsnbc 10.01.2017

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