World Library  
Flag as Inappropriate
Email this Article

Cadivi

Article Id: WHEBN0027038283
Reproduction Date:

Title: Cadivi  
Author: World Heritage Encyclopedia
Language: English
Subject: Venezuela, Economy of Venezuela
Collection:
Publisher: World Heritage Encyclopedia
Publication
Date:
 

Cadivi

Comisión de Administración de Divisas (CADIVI)
Formation 5 February 2003
Headquarters Caracas
Region served Venezuela
Leadership Manuel Barroso
Budget 50 billion USD (2009)
30 billion USD (2010)[1]
Website cadivi.gob.ve

CADIVI (Comisión de Administración de Divisas - Commission for the Administration of Currency Exchange) is the Venezuelan government body which administers legal currency exchange in Venezuela. Exchange controls under CADIVI were adopted on 5 February 2003 in an attempt to limit capital flight,[2] in the aftermath of a two-month strike/lockout aimed at toppling the government, which saw GDP fall 27% during the first four months of 2003.[3] The official buy/sell exchange rate was initially fixed at BsF. 4,28 / BsF. 4,3 (respectively) [4] per US Dollar (USD). Currently the official buy/sell exchange rate is fixed at BsF. 6,3 (respectively) [5] per US Dollar (USD).


According to the Bank for International Settlements, "The Central Bank of Venezuela (BCV) fixes a monthly allocation of foreign currency to be administered by CADIVI, purchases foreign currency from residents, and sells foreign currency to the public and private sectors subject to approval from CADIVI."[6] Under Venezuelan law PDVSA must sell its foreign exchange to the Central Bank, thereby providing the bulk of foreign currency in Venezuela. The Venezuelan private sector requires more foreign exchange for imports than it generates for exports, and is dependent on the Bank to satisfy the difference.[6]

A similar agency, RECADI, had been set up in 1983, to manage a system of differential exchange rates and capital controls,[7] and disbanded in 1989 when the differential exchange rate system was abolished.[8] RECADI saw widespread corruption, and became a substantial scandal in 1989 when five former ministers were arrested, although the charges were later dropped.[9]

In 2008, the Chavez government created a new currency known as the bolívar fuerte (eng. "bolivar") and pegged the currency to a higher rate against the dollar than the market value. This created a scarcity of foreign currency, as confidence in the bolivar declined, and foreign exchange, especially the U.S. dollar, was in greater demand.[10]

References


This article was sourced from Creative Commons Attribution-ShareAlike License; additional terms may apply. World Heritage Encyclopedia content is assembled from numerous content providers, Open Access Publishing, and in compliance with The Fair Access to Science and Technology Research Act (FASTR), Wikimedia Foundation, Inc., Public Library of Science, The Encyclopedia of Life, Open Book Publishers (OBP), PubMed, U.S. National Library of Medicine, National Center for Biotechnology Information, U.S. National Library of Medicine, National Institutes of Health (NIH), U.S. Department of Health & Human Services, and USA.gov, which sources content from all federal, state, local, tribal, and territorial government publication portals (.gov, .mil, .edu). Funding for USA.gov and content contributors is made possible from the U.S. Congress, E-Government Act of 2002.
 
Crowd sourced content that is contributed to World Heritage Encyclopedia is peer reviewed and edited by our editorial staff to ensure quality scholarly research articles.
 
By using this site, you agree to the Terms of Use and Privacy Policy. World Heritage Encyclopedia™ is a registered trademark of the World Public Library Association, a non-profit organization.
 



Copyright © World Library Foundation. All rights reserved. eBooks from World eBook Library are sponsored by the World Library Foundation,
a 501c(4) Member's Support Non-Profit Organization, and is NOT affiliated with any governmental agency or department.