Feb. 14 (Bloomberg) -- A search for the wellspring of the discontent that has filled Caracas’s streets with protesters this week could begin and end with Joel Correa and his son’s malfunctioning liver.
Correa is down to a three-day supply of the pills that help keep his 10-month-old boy’s liver working. After searching pharmacies in three Venezuelan cities, he starts an eight-hour round-trip from his hometown of San Cristobal to the Colombian border town of Cucuta.
“Traveling to Cucuta to buy medicine is an odyssey,” Correa, a 26-year-old tool salesman and father of two, says as he describes the 40-kilometer (25-mile) mountain pass and the national guard checkpoints along the road. “But I’ve had no other options since my little boy was two months old.”
Correa isn’t alone in his struggles as currency controls keep store shelves empty in a country that has the world’s biggest oil reserves. Shortages of everything from food to medicine this week sparked the biggest street protests since President Nicolas Maduro took office in April, leading to at least three deaths. Maduro called the protests an attempted coup and banned further street demonstrations.
With Venezuela importing 70 percent of its goods, the shortages are fueling annual inflation of 56 percent and worsening the bolivar’s 73 percent decline on the black market. The central bank’s scarcity index reached 28 percent in January, the highest since the measure was created in 2005, meaning that more than one in four basic goods was out of stock at any given time.
“There are a lot of concrete bread-and-butter issues regarding shortages and inflation and things like that that people are really angry about,” Gregory Weeks, a Latin America specialist who chairs the political science department at the University of North Carolina at Charlotte, said by phone.
Maduro said Feb. 12 that arrest warrants were issued for two opposition politicians, who he said were recorded in a telephone call saying they expected this week’s protests to turn violent. About 50,000 people marched through Caracas that day, according to opposition party Voluntad Popular.
Amid the instability, the yield on Venezuela’s benchmark 9.25 percent dollar bond due in 2027 has climbed 30 basis points, or 0.30 percentage point, this week to 15.4 percent.
The central bank, responsible for distributing dollars to importers, cut sales of greenbacks to private importers by 25 percent to $23.2 billion last year, Economy Vice President and Oil Minister Rafael Ramirez said on Jan. 22. In the same period international reserves fell to a 10-year low of about $21 billion.
Maduro said Feb. 12 that Venezuela will introduce a third dollar allocation system, in addition to the state’s currency board that sells greenbacks at the official rate of 6.3 bolivars per dollar and an auction system that last sold U.S. currency at 11.36 per dollar. Venezuela has enough dollars for the economy’s needs, Maduro said.
On the black market, one dollar sells for about 87 bolivars, according to dolartoday.com, a website that tracks the rate on the Colombian border.
Venezuela’s Information Ministry didn’t respond to a telephone message and e-mail sent by Bloomberg News seeking comment on the shortages.
Correa says his son Santiago suffers from biliary atresia, a disease that blocks bile flow from the liver to the gallbladder. In Cucuta, Correa says he pays 150 bolivars ($23.81) per pill of ursodeoxycholic acid, five times more than at his local drugstore in San Cristobal. The pills prevent a patient’s liver from deteriorating further while awaiting a transplant, according to Caracas gastroenterologist Magaly Rodriguez, who isn’t treating Santiago.
The Venezuelan Pharmaceutical Association, which represents about 5,700 outlets, says that about 40 percent of medicines used in the country are out of stock, with supply problems affecting both price-regulated and non-regulated medicines.
“For the last two years, medicine supply has been intermittent,” federation President Freddy Ceballos said in a telephone interview. “But in the last quarter of 2013 the situation worsened because providers stopped receiving foreign currency from the government.”
The government owes medicine importers about $3 billion for goods that have already been imported, he said. Total U.S. currency obligations to private companies have surged to more than $56 billion, according to Barclays Plc.
In the absence of fully stocked pharmacies, Twitter has become an important tool for finding medicine. Patients exchange messages to locate pharmacies carrying whatever they need: blood-pressure drug Carvedilol, Glucophage for diabetes, Digoxin for congestive heart failure, and thyroid hormone Euthyrox.
Caracas cardiologist Juan Colan says some of his patients drive nearly 700 kilometers from Caracas to Cucuta to buy the heart medicine Digoxin. He said about 80 percent of the calls from patients are to discuss alternative treatments after the original prescription wasn’t found.
“At home we need medications for diabetes, thyroid and hypertension and I have to say that since December my kids have been facing struggles to find it,” Carmen Jimenez, 73, says as she stands in line with 90 other customers in a Locatel pharmacy in Caracas. “I’m here today because I need Milpar, a medicine that helps me to go to the bathroom and I couldn’t find it.”
For 40-year-old teacher Adriana Di Cesare, daily life is a plight to find the radioactive iodine she needs to treat her thyroid cancer.
Suppliers to Suradi C.A., one of the four radioactive iodine importers in Venezuela, haven’t received dollars to import the product since September, said Paula Allala, the company’s marketing manager.
The medicine, used after the removal of the thyroid to prevent cancer cells from spreading, isn’t available in the country and the companies are meeting with the Health Minister to ask for dollars, she said. Suppliers from Venezuelan allies Cuba and Argentina have both stopped shipments, according to her.
“I won’t calm down until I’ve done the treatment, because without it a cancer with a high probability of cure may become lethal,” Di Cesare said in a phone interview from Maracaibo. “I’m not asking for free treatment, I just want them to facilitate the purchase of the iodine abroad.”
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