Venezuelans suffer from a collapsing economy while Trump promises economic revival

CARACAS, Venezuela (AP) — President Donald Trump vowed at the White House that U.S. intervention in Venezuela would pour billions of dollars into the country’s infrastructure, revitalize its once-booming oil industry and ultimately bring a new era of prosperity to the Latin American nation.

Here, in a sprawling street market in the capital, public utility worker Ana Calderon wishes she could buy the ingredients needed to make a bowl of soup.

Read more: Why does Venezuela’s oil matter to the United States?

“Food is incredibly expensive,” Calderon says, noting the rapid rise in prices, which has resulted in celery selling for double what it was just a few weeks ago, and a kilogram of meat selling for more than $10, or 25 times the country’s monthly minimum wage. “Everything is expensive.”

Venezuelans, absorbing news of the United States’ brazen dumping of former President Nicolas Maduro, are hearing great promises of future economic prowess even as they live under today’s crippling economic realities.

“They know that expectations have changed dramatically, but they don’t yet see it on the ground,” says Luisa Palacios, a Venezuelan-born economist and former oil executive who is a researcher at Columbia University’s Center for Global Energy Policy. “What they see is repression. They see a lot of confusion.” “People are optimistic and expect that things will change, but that does not mean that things will change now.”

He watches: Senate moves to restrict Trump from further military action against Venezuela

Whatever hope there is that the United States can intervene to improve Venezuela’s economy is juxtaposed with the crushing daily realities that most people here live with. People usually work two, three or more jobs to survive, and cupboards and refrigerators remain almost empty. Children go to bed early to avoid hunger pangs; Parents choose between filling a prescription and buying groceries. It is estimated that eight out of 10 people live in poverty.

It has prompted millions to flee the country for other places.

Those who remained are concentrated in Venezuela’s cities, including its capital, Caracas, where the street market in the Catia neighborhood was so crowded that shoppers were bumping into each other and dodging oncoming traffic. But as prices have risen in recent days, locals have increasingly moved away from the market stalls, reducing the chaos to relative silence.

Neela Rua, holding her 5-month-old baby, sells cartons of cigarettes to passers-by, having to monitor daily fluctuations in the currency to adjust the price.

He watches: White House: The United States will control the Venezuelan oil industry “indefinitely”

“Inflation, more inflation, and currency depreciation,” says Roa. “It’s out of control.”

Roa did not believe the news of Maduro’s arrest. Now she wonders what will come of it. She believes it will take a “miracle” to fix Venezuela’s economy.

“What we don’t know is whether the change is for the better or for the worse,” she says. “We are in a state of uncertainty. We have to see how good it can be, how much it can contribute to our lives.”

Trump said that the United States would distribute some of the proceeds from the sale of Venezuelan oil to its residents. But this commitment so far appears to be largely focused on America’s interests in extracting more oil from Venezuela, selling more American-made goods to the country and repairing the power grid.

The White House is hosting a meeting Friday with U.S. oil company executives to discuss Venezuela, which the Trump administration is pressing to open its massive but struggling oil industry more broadly to American investment and know-how. In an interview with The New York Times, Trump acknowledged that reviving the country’s oil industry would take years.

“Oil will take some time,” he added.

Venezuela has the largest proven oil reserves in the world. The country’s economy depends on them.

Maduro’s predecessor, Hugo Chavez, elected in 1998, expanded social services, including housing and education, thanks to the country’s oil boom, which generated an estimated $981 billion in revenue between 1999 and 2011 as crude oil prices rose. But corruption, declining oil production, and economic policies led to a crisis that became evident in 2012.

Chavez appointed Maduro as his successor before his death from cancer in 2013. The country’s political, social and economic crisis, intertwined with falling oil production and prices, has been the defining feature of Maduro’s entire presidency. Millions were pushed into poverty. The middle class practically disappeared. More than 7.7 million people left their homeland.

Albert Williams, an economist at Nova Southeastern University, says a return to peak energy would have a major spillover effect in a country where oil is the dominant industry, leading to the opening of restaurants, stores and other businesses. What is unknown, he says, is whether this revitalization process will happen, how long it will take, and how the government formed by Maduro will adapt to the change in power.

“That’s the billion-dollar question,” Williams says. “But if you improve the oil industry, you improve the country.”

The International Monetary Fund estimates that Venezuela’s inflation rate is a staggering 682%, the highest level of any country for which it has data. This has caused the cost of food to rise beyond what many can afford. Venezuela’s monthly minimum wage of 130 bolivars, or $0.40, has not risen since 2022, putting it well below the UN measure of extreme poverty of $2.15 a day.

The currency crisis prompted Maduro to declare an “economic emergency” in April.

For those hit hardest, there is no immediate sign of change, says Osha Haley, an economist at Wichita State University who studies emerging markets.

“In the short term, most Venezuelans will probably not feel any economic relief,” she says. “A single oil sale will not solve the country’s rampant inflation and currency collapse. Jobs, prices and exchange rates will likely not change quickly.”

In a country that has seen as much conflict as Venezuela in recent years, locals are so accustomed to doing what they have to do in order to get through the day, that many utter the same expression.

In Spanish they say “analyst,” or “figure it out,” which is shorthand for the jury-rigged nature of life here, where every transaction, from riding the bus to buying a child’s medicine, involves careful calculations.

Here in the market, the smell of fish, fresh onions and car exhaust combine. Calderon, who is making his way across the country, is facing a sharp rise in prices, saying that “the difference is huge,” as the country’s official currency has fallen rapidly against the unofficial currency, the US dollar.

Unable to provide all the ingredients for her soup, she left with a bunch of celery but no meat.

Sedensky reported from New York. Associated Press writer Josh Bock in Washington contributed to this report.