Venezuela has closed its border with Colombia for 72 hours in the latest measure to combat smuggling gangs.
President Nicolas Maduro said the “mafia” operating in border areas is causing huge damage to the economy.
The move comes as Maduro is trying to get a grip on Venezuela’s galloping inflation, which has choked business and made bolivar notes among the hardest items to find in the already shortage-plagued oil-based economy.
Many items subsidised by Venezuela’s socialist government, including diesel and petrol, are sold at a huge profit over the border in Colombia.
On Sunday, he announced that the country’s highest denomination bank note would be taken out of circulation to stop gangs hoarding the currency.
“This is an attack against Venezuela, so this is a necessary, unavoidable measure,” Maduro said in announcing the border closure in a televised address alongside top economic aides. “It’s the first of a series of decisions that we’re going to be taking to defend our bolivar, our economy and our people.”
The border shutdown coincides with Maduro’s decision to withdraw from circulation the 100-bolivar note, which is currently the country’s largest-denominated bill but worth only about 3 US cents at the widely used black market rate. The government says it will start replacing the 100-bolivar note with larger bills.
Venezuela last closed most border crossings with Colombia in August 2015. The border was partially reopened a year later.
This time, Mr Maduro said the border would be reopened after 72 hours, once the 100-bolivar notes cease to be valid.
In the coming days, the country is expected to roll out six larger-denominated bills reaching as high as 20,000 bolivars. Many economists say the larger bills will fuel only faster inflation, which is already the highest in the world and forecast by the International Monetary Fund to soar past 1,000 percent in 2017.Please subscribe to our newsletter