Could smuggling be to blame for Venezuela's food shortages? By Ed Butler

BBC News, Maracaibo Published duration 3 September 2013

image caption Queues for price-capped foods snake around many a supermarket in Maracaibo

At 09:00 outside a downtown supermarket in Maracaibo, Venezuela, the temperatures are already stiflingly hot - close to 40C (104F) in the shade, if you can find any shade.

I am at the back of a line of some 200 members of the Guajiro indigenous group, poor men and women who have travelled many miles from their homes in the country or the city's outer shanty towns, and have waited here for up to five hours.

It is a pathetic sight, as they shelter under shawls waiting to buy their allotted ration of price-capped foods like rice, sugar, chicken, wheat, and corn flour - goods that have become increasingly scarce as shortages grip many regions of Venezuela.

But, if you believe what some are telling me here, these poor villagers may themselves be the cause of the nation's woes.

"Eighty per cent of these people are smugglers," one shopper, Maigualita Barallt, says quietly, shaking her head.

"They are buying up all they can and selling them on to bachaqueros [smugglers] who carry the food across the border to Colombia," she adds.

The bachaqueros are notorious in these parts. And they are widely blamed for hiring poor locals en masse to empty the shelves of the subsidised products.

There are massive incentives to do so. The goods remain at a fixed price whilst inflation is crippling the rest of the Venezuelan economy.

Inflation is at 42.6% according to figures released by Venezuela's Central Bank in July 2013, but is widely believed to be considerably higher.

Add to that a massive capital flight estimated by economic research firm Ecoanalitica to amount to $33bn in 2011, despite government currency controls aimed at curbing the problem.

Moreover, a fixed exchange rate is creating a huge black market demand for foreign cash.

Combine these factors and you find that a Venezuelan bottle of milk could be worth seven or eight times more if sold on the Colombian side of the border.

No wonder goods like fresh milk and butter have rarely been seen in Venezuelan supermarkets this year.

Smuggling haven

The long, heavily forested frontier between the countries would make smuggling contraband relatively easy at the best of times. But according to locals, the traffic is open and visible even at official checkpoints.

image caption Police Chief Zulia state Jaire Ramirez blames mafia gangs for the shortages

"It's not smuggling as you think it is," one coffee producer told me.

"You can see the lorries waiting in the line for them to change the guard. And then when there's someone who's friendly, they pay the guy and they go through."

So is not the smuggling itself the main cause of the shortages, I ask him.

"Yes and no. The government is crippling businesses anyway with corruption and red tape," he replies.

"And besides, by fixing the prices they created the market themselves. They are in on it. Everyone breaks the law in this country - including the government."

The man in charge of enforcing the law in this western part of Venezuela is Jaire Ramirez, a member of the governing party, who proudly poses in front of a picture of the late president, Hugo Chavez.

He concedes that the contraband trade of coffee, sugar, rice, dairy products and petrol now amounts, by the government's own estimates, to five or six billion dollars a year. He blames "capitalists" and unnamed mafia gangs for the problem.

"The scarcity is not a problem of insufficient goods. The amount of food that arrives at the supermarket has tripled," he says.

"We are making many arrests now, as we have been told to do by our supreme commander, President Chavez. We are sure we can win this fight against the criminals."

Policing problem

The optimism is not universally shared though. Critics say that in reality production is down, and that the government needs new economic policies, not tougher policing.

image caption A sign above supermarket shelves reads 'Made in socialism'

They say policing in any case has never been this government's strong suit.

The murder rate has almost quadrupled since President Chavez came to power: from 4,500 in 1998 according to United Nations figures to more than 16,000 in 2012 by the government's own acknowledgment.

Venezuela is now one of the most violent countries in the world, and shortages are affecting the treatment of those caught up in the wave of violence,

A doctor in one of the country's largest hospitals told me that many gunshot victims were dying unnecessarily, and in increasing numbers, because basic supplies of gauze, medicines and anaesthetics were being stolen from storerooms and smuggled abroad.

Jose Luis Iragorry puts the crisis in perspective. He is a dairy farmer with 120 head of cattle, working in Zulia province, the country's agricultural heartland close to the Colombian border.

He says smuggling is the main reason most Venezuelans have not seen fresh milk or butter for most of this year, although he denies involvement himself and says that the biggest worry for producers like him is security.

"The only armed forces in our area are Colombian Farc guerrilla fighters," he says.

"They control much of the border region. Farmers close to me are having to pay protection money."

It is a problem the Venezuelan government has acknowledged. On a recent visit to Apure province, on the border with Colombia, Foreign Minister Elias Jaua said he was working with the Colombian government to crack down on cross-border smuggling and the growing influence of criminal gangs in the area.

"There are gang bosses controlling the petrol [smuggling], there are gang bosses controlling food smuggling, there are gang bosses controlling the smuggling of cement, we're going to go after all of them together," Mr Jaua said.

But Mr Iragorry says he has seen little police or army presence.