One of the most vivid examples of almost developed socialism, Venezuela, clearly demonstrates all the 'advantages' of this model of society. A country with huge oil reserves has been unable to get the best out of it for several years. Under the direction of President Nicolas Maduro, the local population continues to live below the poverty line, while the national currency depreciates at a rapid pace.
Just recently, the official rate of the US dollar in the Bolivarian Republic of Venezuela, which is set by the Central Bank of Venezuela, jumped by 24 times. The reason for this was the currency redenomination.
Venezuela's national currency was set by the regulator at the level of about 60 ‘sovereign bolivars’ to the US dollar and 68.65 ‘sovereign bolivars’ to the euro. Rates seem good. However, it should be noted that the official exchange rate in the country is of little concern to people; it is unreal to buy dollars and euro at these rates. Before the denomination, the black-market exchange rate was 3 million bolivars per dollar. But there is good news. Less than a month ago, Nicolas Maduro has ordered a 60% increase in the country's minimum wage. Now it amounts to 3 million bolivars. Thus, including food subsidies, the guaranteed income will increase to 5.2 million bolivars, which is approximately equal to 1.85 dollars.
The currency reform was launched to somehow address this financial issue. As a result, Venezuela cut five zeros from its currency, and the rate of the sovereign bolivar was tied to the Venezuelan cryptocurrency, Petro, which, in turn, depends on the cost of a barrel of oil produced in the republic.
