The black market or parallel market for dollars in Venezuela is the buying and selling of the currency clandestinely and supposedly illegal. I say allegedly illegal because even though it is prohibited to disclose the black market rate, there are different digital media that publish such information on the Internet against the law and the will of the government. Thanks to the deficit of dollars in the country and massive restrictions on buying it from the government, the country has been forced to seek alternative route for getting foreign currency. This mechanism which has been the black market, has managed to be an escape route not only for travelers and investors, but also for merchants that provide basic services such as food and medicine.
The big issues with this parallel market and especially with the circumstance that suppliers have easy access to it is the fact that many traders have had to buy dollars on the black market to import, so they must charge very high prices to make a profit. Venezuelans who earn in dollars (not many of them) or those who have easy access to it see their currency purchasing power sustain or grow, but never decline, while the opposite is true for those who earn in bolivars. The parallel market generates what its name suggests: an alternative economy that creates distortions in the official economy.
To all this we must add the fact the Venezuelan government has taken control of many if not all economic sectors in the country, which has inhibited competition, and resulted in lack of goods, lack of diversity or choices, and State indebting in order to satisfy the demand private companies could be helping to satisfy. This results in a deterioration in the economic situation of the country, which the government seek to alleviate with more restrictions and controls, thereby creating a vicious circle where more control generates more black market and more black market generates more control.
First Part:
Shaping Factors in Venezuela’s Economic Insecurity: PART I CADIVI