World of Coins

Modern coins, pseudo coins and trade tokens of other continents => Central and South America => Topic started by: Pabitra on July 02, 2021, 06:12:43 AM

Title: Venezuela to remonetise
Post by: Pabitra on July 02, 2021, 06:12:43 AM
See

https://www.bloomberg.com/news/articles/2021-07-01/venezuela-to-cut-six-zeroes-off-bolivar-to-simplify-transactions

Venezuela to Cut Six Zeroes Off Bolivar to Simplify Transactions

Venezuela is preparing to once again lop off zeroes from the national currency in an attempt to simplify daily transactions which sometimes barely fit on a calculator or require swiping cards multiple times to complete a purchase.

The central bank is planning to slash six zeroes from the bolivar as early as August after previous attempts to issue larger-denomination bills failed to resolve problems created by endemic inflation, according to three people with direct knowledge of the matter who aren't authorized to speak publicly about the plans.

That means one dollar would fetch 3.2 bolivars instead of 3,219,000 at present.

Venezuela last carried out a "redenomination" of the bolivar in 2018 and in March began printing a 1 million-bolivar note, the largest in the country's history. But that bill is now worth just $0.32 and isn't enough to buy a cup of coffee. Since 2008, the government -- first under the late Hugo Chavez, and then under current President Nicolas Maduro -- has removed 8 zeroes from the currency, as hyperinflation decimated people's savings.

While the country has now informally adopted the U.S. dollar for many every day transactions, most Venezuelans only earn bolivars and the local currency is needed for things like bus fare, parking and tips.

With electronic payments on the rise in Venezuela, the central bank shouldn't have to print as many of the new bills as in previous "redenominations," the people said. The bank will likely roll out six different denominations ranging from 2 to 100 bolivars, they said. The name would remain "bolivar soberano."

The push for simplifying bolivar transactions has come largely from companies who have raised the issue with the government. Things like paying taxes and dealing with other accounting calculations have become absurdly complex.

"This has been desperately awaited by businesses due to the serious operational consequences that come from the overflow of digits in the system," said economist Tamara Herrera, head of consulting firm Sintesis Financiera.

The central bank didn't respond to several requests for comment while the government declined to comment on the matter.


While previous attempts to relaunch the currency by cutting off zeroes and printing new bills have failed shortly after implementation, a series of recent reforms that have slowed consumer price gains may mean it has a better chance of sticking now.

Following the second-longest hyperinflation stretch in the country's history, annual inflation is down to 2,339% a year from more than 300,000% in 2019, according to Bloomberg's Cafe con Leche index. On a monthly basis, price gains slowed even further to about 20% in May from April. The central bank no longer publishes regular inflation data.

Previous attempts to relaunch the currency by cutting off zeroes have failed
Venezuela's economy may have hit bottom after seven years of economic contraction during which the currency became virtually worthless amid crashing oil prices and unchecked state spending. Under pressure by U.S. sanctions, the government was forced to scrap some price controls, reduce subsidies on goods including gasoline and remove many restrictions on foreign exchange which may allow the economy to grow this year.

"Everyone has been affected by the huge lag in providing cash for the country," Herrera said. "Without a real economic stabilization program, we will need another redenomination in a few years."






Will it issue coins?
Title: Re: Venezuela to remonetise
Post by: Figleaf on July 02, 2021, 07:44:44 AM
As long as Venezuela's economy is a shambles a coinage reform makes no sense. If effected, it will be just a waste of public funds when the government budget is already out of whack.  Inflation has come down considerably, but it is still too high. Growth is increasingly negative and unemployment scary.

Peter
Title: Re: Venezuela to remonetise
Post by: Pabitra on July 02, 2021, 09:59:44 AM
In the earlier remonetisation of 2018, the introduction Bolivar Soberano was accompanied by two coins ( 50 Centimos and 1 Bolivar). The reason is simple. The smaller denomination notes have very short life due to poor handing by users and higher frequency of transactions and need to be replaced free of cost. Thus their economic cost is much higher than their contribution to economy.

Kenya is also facing poor life of smaller notes.
See


https://www.standardmedia.co.ke/business/business/article/2001417009/poverty-to-blame-for-worn-out-bank-notes-says-senator



Not having coins is a wrong economic decision and millions of such decisions are the reason for poor economy of the nations.
Title: Re: Venezuela to remonetise
Post by: Henk on July 02, 2021, 11:15:57 AM
Quote from: Pabitra on July 02, 2021, 09:59:44 AM
Not having coins is a wrong economic decision and millions of such decisions are the reason for poor economy of the nations.

I do not agree. If the rate of inflation is very high the decision to have coins is wrong as coins have an intrisic value because of their metal. It takes time to produce coins, more time than is needed for paper money. By the time coins are issued their monetary value may have dropped below their metal value. So issuing them is a loss to the government. If not they may very soon become more valuable as metal than as money. They certainly will not last their potential life of 50 years or more. This is why in countries with a very high rate of inflation no coins in the countries currency are in circulation. Perhaps plastic coins could be an alternative.
Title: Re: Venezuela to remonetise
Post by: Jostein on August 06, 2021, 10:22:36 AM
From October, 1st, the Central Bank of Venezuela will issue the "Bolívar Digital" 1 Bolívar Digital = 1.000.000 Bolívares Soberanos. Although the name is "Digital", there will be also issued one coin (1 bolívar) and five notes (5, 10, 20, 50 and 100 Bolívares), all the banknotes have the same design with different colors.

http://www.bcv.org.ve/billetes-y-monedas/nueva-expresion-monetaria

In the BCV statement, we can read a document that talks about this new "currency expresion" (trying to avoid that it is the third currency revaluation) will be the currency of the economic recovery after the fierce attack that Venezuelan women and Venezuelan men have been suffering from foreign powers from years. The typical Socialist populist rhetoric of every time. Poor Venezuela... :-\

Jostein
Title: Re: Venezuela to remonetise
Post by: eurocoin on August 24, 2021, 09:32:05 PM
Larger image of the new 1 Bolivar coin. To the left of the portrait of Símon Bolívar, the mintmark of the Venezuelan mint can be seen.

(http://www.worldofcoins.eu/forum/index.php?action=dlattach;topic=39617.0;attach=111260;image)
Title: Re: Venezuela to remonetise
Post by: eurocoin on September 29, 2021, 12:08:17 PM
During a press conference, the Venezuelan vice-president has announced the release of new coins of 0.25 and 0.50 bolivar. This in addition to the new 1 bolivar coin, that was announced earlier.
Title: Re: Venezuela to remonetise
Post by: eurocoin on September 29, 2021, 12:35:35 PM
Images of the other 2 new coins and their technical specifications. All 3 new coins are sheduled to be released next week. I find the inscriptions on the coins '0.25 centimos' and '0.50 centimos' rather odd, as these are respectively 25 and 50 centimos coins (and so 0.25 and 0.50 bolivar).

(http://www.worldofcoins.eu/forum/index.php?action=dlattach;topic=39617.0;attach=111939;image)

(http://www.worldofcoins.eu/forum/index.php?action=dlattach;topic=39617.0;attach=111940;image)
Title: Re: Venezuela to remonetise
Post by: Jostein on September 29, 2021, 02:56:35 PM
 ???

That coins are not well expressed in Spanish...

"0,25 céntimos" means quarter cent.
"0,50 céntimos" means a half cent.

The correct form must be "0,25/0,50 bolívares" o "25/50 céntimos".


Whatever...it's the same.

Poor Venezuela... :-\

Title: Re: Venezuela to remonetise
Post by: eurocoin on November 02, 2021, 08:05:57 PM
I still have not seen any images of the issued coins, even although the 3 new coins were sheduled for release on October 4.
Title: Re: Venezuela to remonetise
Post by: Pabitra on December 05, 2021, 07:05:43 AM
Issued
Title: Re: Venezuela to remonetise
Post by: Pabitra on December 28, 2021, 05:34:51 AM
50 Centimos issued too.
1 Bolivar is 25.4 mm and 6.5 grams
50 Centimos is 23.5 mm and 5 grams
Title: Re: Venezuela to remonetise
Post by: Figleaf on December 28, 2021, 09:00:40 AM
It seems to me that the dimensions are too close together, as research says size differences can be felt when they are at least 2.5 mm. The difference in weight does not help.

Peter
Title: Re: Venezuela to remonetise
Post by: eurocoin on December 28, 2021, 10:26:10 AM
At least they put the denomination in the right format.
Title: Re: Venezuela to remonetise
Post by: Pabitra on December 28, 2021, 11:57:45 AM
Quote from: Figleaf on December 28, 2021, 09:00:40 AM
It seems to me that the dimensions are too close together, as research says size differences can be felt when they are at least 2.5 mm. The difference in weight does not help.

With inflation still raging, I consider it to be a big achievement that they not only managed to mint it but put it into circulation too. Let us see if they issue 25 centimos too?
Title: Re: Venezuela to remonetise
Post by: Offa on December 28, 2021, 12:08:02 PM
Ah the wonders of Madura's brand of socialism. 
Title: Re: Venezuela to remonetise
Post by: Pabitra on January 10, 2022, 05:03:10 AM
25 centimo with diameter of 21mm issued.