The current dollarization in Venezuela has been described as an influence of Money Laundering. According to a study by Ecoanalitica, there are more retail transactions in dollars in the country than bolivar, which is the country’s currency. Though the dollarization is associated with price control, however, it has resulted in a hike in prices of commodities thereby making it difficult for people who depend on wages in bolivars to survive.
According to a University Professor and member of CEDICE Libertad’s Academic Committee, Andrea Rondon, the state was forced into what he termed “relaxation” due to many sanctions, and it can only improve when laws and controls are changed. The ongoing investment in some parts of the state, talking about the opening of inns and premises are probably connected with money laundering, he added.
He also stated that the dollars in circulation were injected by the government and they are so wide because it has no hindrance. He further claimed that as far as Nicolas Maduro’s regime is concerned, the dollars no longer come from oil rent but from illegal transactions, pointing to how Maduro, who once termed dollar as a currency ‘without backing’ is now glad about the dollarization that is taking place.
He concluded by saying that the economy is not improving because the same policies and laws are still in place, and it is difficult for Venezuela’s economy to improve until the policies and controls are changed.