Venezuela’s Transportation Shift: New Fare Regulations and Emerging Ride-Apps

Venezuela’s Transportation Shift: New Fare Regulations and Emerging Ride-Apps

A New Dawn in Transportation Fare Regulation

Venezuela is witnessing a shift in its transportation sector following the publication of an official exhortation by the Ministry of Transport of the Bolivarian Republic of Venezuela. As documented in the Official Gazette No. 42,713, the minimum urban fare has been set at nine bolivars (Bs 9.00) and the maximum at ten bolivars (Bs 10.00). For state transport operators, the minimum fare rests at five bolivars (Bs 5.00).

The Ministry has also established a Maximum Official Fare for Suburban Routes at the national level. This move aligns with the Recovery, Growth and Economic Prosperity Program, a strategy created by the President of the Bolivarian Republic of Venezuela, aimed at ensuring sustainable control mechanisms to protect the basic need of the entire population by making fair preventative adjustments in the sector’s rates.

Guidelines to Ensure Compliance

In its exhortation, the Ministry urges mayors at the national level, transport unions, and competent authorities with jurisdiction over urban transport fares to respect and maintain the fares in their areas of competence for private transport providing public service. The directive also includes provisions for different segments of the population:

• Women aged 55 or above, and men aged 60 or above, will have free urban transport.
• Free urban transport will be established for people with disabilities, and no charges will be levied for the transport of wheelchairs, walkers, or other technical aids.
• Public land passenger transport service providers must provide service to students, and accept fares with a 50% discount on the rate set in this exhortation.

The Ministry also warns transporters to fully comply with the established rates; otherwise, they could face suspension of driving licenses and agreed benefits.

Rise of Local Ride-Share Apps

Amidst these regulatory changes, local entrepreneurs have ventured into the ride-sharing industry, introducing apps like Ridery. These apps, which began operations during the pandemic, have found a welcome market among customers frustrated by scarce taxis, aging buses, and a decrepit subway system. The switch of currencies from the Venezuelan bolivar to the U.S. dollar has also helped these services set their prices in dollars, thus curbing years of skyrocketing inflation.

Impact on the Local Economy

However, not everyone can afford these ride-sharing services. With the country’s monthly minimum wage at $30, and average monthly salaries in the private sector less than $100, even a $3 ride can be a significant portion of many budgets. Despite this, the introduction of these ride-sharing apps has had a positive ripple effect on wages, forcing businesses to increase salaries to retain employees who might otherwise move to ride-sharing or delivery jobs.

The Road Ahead

While these developments represent a significant shift in Venezuela’s transportation sector, the country still grapples with a significant transportation crisis. Economic troubles, hyperinflation, and the collapse of the public transportation system pose significant challenges. However, the introduction of new regulations and ride-sharing services suggest that Venezuela is taking steps towards a more sustainable transportation sector.