For Venezuelans Fleeing Crisis, Argentina Proves a Tough Start

(Bloomberg) -- First went the chicken, then the sugar. Meat disappeared and bread soon after. Venezuela’s food shortages, skyrocketing prices and rampant crime made the decision for Veronica Garcia: She would find refuge in Buenos Aires.

Instead, Garcia was greeted by Argentina’s currency crisis when she and her boyfriend, Miguel Nicorsin, arrived in late June. The peso is down 50 percent this year, inflation is climbing and the economy is sinking into recession.

This has spooked the young couple. For while it is true that it’s highly unlikely Argentina turns into the next Venezuela, the young emigres can’t help but see the current crisis through the narrow lens of their recent -- and very traumatic -- experience back home.

“Venezuela started like this," said Garcia, a 25-year-old assistant to an accountant. “I can’t be jumping from one country to the next. I want to see if I can settle down here.”

Garcia and Nicorsin are just two of almost 70,000 Venezuelans who have arrived in Argentina in the past two and a half years, according to government figures. As Venezuela spiraled into a humanitarian crisis, about 2.3 million people have taken to living abroad, of whom 1.6 million have fled since 2015, the United Nations estimated in August. In Buenos Aires, they often take on low-paying jobs, such as food delivery, clothing store work, tending bars or waiting tables.

For Venezuelans Fleeing Crisis, Argentina Proves a Tough Start

Argentina and Venezuela diverge politically, yet they’re Latin America’s poorest-performing economies this year. Venezuela is just far, far worse.

When the price of oil crashed in 2014, Venezuela started running out of hard currency. The bolivar went into freefall in the black market as President Nicolas Maduro ramped up money-printing, triggering one of recent history’s great bouts of hyperinflation. A Bloomberg index puts the annual rate at over 100,000 percent today while the International Monetary Fund predicts it will top 1 million percent by year-end.

Argentina isn’t facing anything even close to such an apocalypse, but its comeback under President Mauricio Macri -- a major critic of Maduro -- has swerved off course. Expected to post 3 percent growth at the beginning of the year, Argentina’s economy may now contract by that much while inflation spikes above 40 percent, double the forecast in January.

Venezuelans still come to Argentina because the language is the same, it’s safe and the immigration paperwork is easier compared with other Latin American nations.

The Journey

Garcia, who graduated in May, drove eight hours with Nicorsin from his hometown of Puerto Ordaz to the Brazil border. They crossed, took a two-hour bus ride, slept, then rode another 11-hour bus to Manaus. Finally, there were two flights to Buenos Aires. Their lives were contained in two backpacks and a few suitcases.

The grueling trek had one silver lining for the couple of two years.

“Best bonding experience ever,” Garcia said in limited English with a smile toward Nicorsin.

For Venezuelans Fleeing Crisis, Argentina Proves a Tough Start

They arrived June 27, shortly after the peso’s first major plunge. In August, as they were getting settled with new jobs and an apartment, it plummeted 25 percent.

Venezuelan Reflexes

“The first thing I thought was, I need to buy dollars so that the money I have now doesn’t devalue,” said Nicorsin, a 25-year-old architect who now works at a clothing shop and free-lances as a graphic designer. “The next thing I thought was, I know how the first stage in Venezuela started.”

Garcia earns 12,000 pesos a month ($315) in her accounting gig, while Nicorsin makes 15,000 ($400) between his two jobs. That’s better than their respective salaries of $50 and $40 a month in Venezuela, but a third goes straight to rent. Add on double-digit inflation and sharply rising utility bills -- a result of Macri’s cutting back on subsidies -- and the budget gets tight fast. Garcia is also saving to purchase a flight for her 14-year-old brother to move to Argentina.

So they make the most of their spare time and tight budget. They go to the city’s elegant parks, dance or pitch in for beers with other Venezuelan friends at apartments. They enjoy knowing they can safely walk at night, and the stunning sight of a fully stocked supermarket.

Nicorsin wears heavy sweaters because he’s not used to colder temperatures after living his whole life in tropical Venezuela. Neither one enjoyed Buenos Aires’ wet, chilly winter. But between fleeing a catastrophe and arriving for an economic crisis, Garcia has adjusted her view of what happiness consists of.

"I can’t think about dreams," she said. "First, I have to find stability, then I’ll have the freedom to dream."

©2018 Bloomberg L.P.