'Get a boat!' Venezuela flights booked full for months

[Bacchus4.0]

http://ca.news.yahoo.com/boat-venezuela-flights-booked-full-months-141950761.html

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Flights are booked solid months in advance, not from a new interest in exotic destinations but because locals are profiting from a play on the nation's tightly controlled currency market.

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There are strict limits on the availability of dollars at the 6.3 rate, but Venezuelans are cashing in on a special currency provision for travelers. With a valid airline ticket, Venezuelans may exchange up to $3,000 at the government rate.

Some are not even flying, leaving many planes half empty.

The profit is realized from an arbitrage process known locally as "el raspao," or "the scrape."

Credit cards are used abroad to get a cash advance -- rather than buying merchandise. The dollars are then carried back into Venezuela and sold on the black market for some seven times the original exchange rate.

[Socialistlemur]

1. It's a really profitable trade

The deal is easier than you think because there are "stores" and "restaurants" with fake points of sale. They charge the Venezuelan trade, hand over cash minus a 20 % cut. The Venezuelan side gets the money deposited in a USA bank. Then the dollars are transferred to a person who wants dollars. They pay 7x the official rate. So 7x times 80 % means 560 % profit.

This trade is mostly carried out by Chavistas known as "enchufados". They also trade via Colombia and any other country where there's an excuse to travel. But the cuts in Colombia near the border run as high as 30 %. An enchufao riding the bus into Colombia only makes a 490 % profit.

[Bacchus4.0]

2. yes, thus the empty seats on the planes. The ticket is just the requirement to get the credit card

I posted a previous story on Venezuelans doing this in Curacao. However, chavista Boligarchs are the main beneficiaries as they likely don't have to suffer the inconvienience of traveling or buying a ticket. They repeat the process of buying dollars at the government rate and selling on the black market, repeat ad infinitum.