Venezuela: The Downside of a Devaluation

The devaluation of Venezuela's currency on Feb. 8, supposedly the first of many impending economic reforms, will be unpopular and will engender considerable opposition. Although social unrest is an ever-present concern in Venezuela, especially considering the health of President Hugo Chavez, these economic measures will be piecemeal and are not likely to trigger immediate political upheaval. Still, if the government is compelled to take more politically sensitive economic action, such as increasing the price of gasoline, unrest will become increasingly likely.