Good for Venezuelan consistency!
Virtual profits, virtual currency, virtual toilet tissue and virtual media access for the opposition. It’s a great place for virtual economists and for virtual consumers .
This week, Ford Motors said that it expects to lose US$ 350 million in Venezuela with the upcoming devaluation, which they believe will take the Bolivar from Bs. 6.3 per US$ to around Bs. 12. Basically Ford has investments in Venezuela valued at around US$ 802 million plus the Government owes them a few hundred million in Cadivi imports, which could eventually be paid at the higher rate of the new official devaluation, which people think will be around Bs. 12. Thus, Ford expects that in 2014 it will not make money in Latin America, only because of Venezuela.
Which shows how difficult it has become to do business in Venezuela, when you book “virtual” profits one year, only to see them disappear the next, together with the loss in value of your assets. Last year, Ford took a US$ 186 million hit when the Government devalued to Bs. 6.3…
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