BOGOTA (Reuters) - Venezuela and Colombia have agreed to create a special exchange rate to boost plummeting bilateral trade between the two Andean countries, their presidents said.
The exchange rate will be set at a later date and will enable each country to trade in its own currency and exchange any trade surplus into an international currency.
"We have established a system, a mechanism for bilateral payments, to facilitate the financial aspect of trade," said Colombia's President Juan Manuel Santos after a meeting with his Venezuelan counterpart Nicolas Maduro in the Colombian coastal city Cartagena on Friday.
Trade between the two countries has fallen 70 percent over the last five years due to political disputes between the preceding leaders of the two countries, Venezuela's Hugo Chavez and Colombia's Alvaro Uribe.
Venezuela's oil-based economy is heavily reliant on imports but the country is facing shortages as importers struggle to obtain dollars whose supply is controlled by the government through a tiered system of exchange rates.
(Reporting by Nelson Bocanegra; Writing by Peter Murphy, editing by David Evans)