Venezuela Introduces New Currency With 6 Fewer Zeros

A new currency with six fewer zeros debuted Friday (Saturday, Oct. 2, 2021, in Manila) in Venezuela, whose currency has been made nearly worthless by years of the world’s worst inflation, Regina Garcia Cano and Jorge Rueda reported for the Associated Press (AP).

Photo Insert: Some of the bolivars in circulation

But the new bills were difficult to find in the capital, where consumers’ fears that prices will continue to spiral upward proved to be right.

“Today, I went to the supermarket and everything was marked in dollars,” Lourdes Pórtelo, an office worker, said in a shopping center in the east side of Caracas. “In the end, I couldn’t buy anything, I didn’t have enough money.”

Before the adjustment, the highest denomination was a 1 million bolivar bill that was worth a little less than a quarter as of Thursday. The new currency tops out at 100 bolivars, a little less than $25 — until inflation starts to eat away at that as well.

The million-to-1 change for the bolivar is intended to ease both cash transactions and bookkeeping calculations in bolivars that now require juggling almost endless strings of zeros.

“The most important and fundamental reason is that the payment systems are already collapsed because the number of digits make the payment systems and doing the math practically unmanageable,” said Jose Guerra, an economics professor at the Central University of Venezuela.

“These debit card payment processing systems or an accounting system for companies... are not intended for hyperinflation, but for a normal economy.” Under the old system, a two-liter bottle of soda pop could cost more than 8 million bolivars — and many of those bills were scarce, so a customer might have to pay with a thick wad of paper.

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