Archive for March 5th, 2009

Government to “intervene” areperas?

March 5, 2009

The new Minister of  Commerce announced today that the Government will review areperas, the popular fast food joints where you can buy the typical staple of Venezuelans. According to this genius of commerce, Eduardo Saman, he went into an arepa place and there was a pork arepa which cost Bs. 20. Then, he argued, from a package of regulated corn flour he says he can make 20 arepas with one kilo of pork, which costs him Bs. 16.

Where should I start?

First of all, a 50 gram pork arepa (20 from a kilo) sounds really small, I am not sure which arepera Mr. Saman went to, but the arepears I go to don’t make such small sizes. Second, the arepera I go to has prices which are about 25% cheaper (including VAT, which the Minister did not mention. Finally, maybe the people can buy pork at Bs. 16 per kilo in Mercal, but commercial establishments certainly can not and there you have to pay around Bs. 36 per kilo for pork, which always including some bone. Add to that the 10% VAT that is included in the price and Mr. Saman’s math certainly needs to be looked at.

But, in the end, Mr. Saman can not accuse areperas of usury as he suggested, because ussur only applies to interest charged on loans. There are no regulations on the price of arepas, but it sounds like we will see one in the near future.

This is actually quite sad for me. I still recall when I acme back from my studies abroad some time ago, how disappointed I was to find that most areperas had turned into hamburger joints, after the Carlos Andres Perez Government (I) regulated the price. One of the few things Luis Herrera did which was a positive was to deregulate arepas and immediately areperas sprouted all over the country.

But Chavismo is clearly set in ruining the country. After all, if it was so cheap to make an arepa, how come there are not hundreds of arepa carts around the city, selling them at half the price?

Maybe a cook in my audience could take the time to figure out how many arepas (arepera size) with pork filling (also arepera size) you can make with one kilo of pork and one package of Harina Pan and we can figure out what the margins are for the arepa, without talking into account overhead and the like.

Clearly in Venezuela, what is not illegal, maybe so under Chavismo criteria…

What’s next, the arepa decree?

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