HAVANA TIMES — Venezuelan president Nicolas Maduro announced Wednesday that the national minimum monthly wage will triple by decree to compensate the hyperinflation, which means it will now stand at just over a dollar. However with the food allowance it will approach 2 dollars. (One US dollar equals 2.8 million bolivars on the street.)
Maduro said that pensions and a series of food vouchers that the Government gives out will also increase, effective immediately, reported dpa news.
The national monthly minimum wage has gone up from 1 million bolivars (0.38 USD on the black market) to 3 million bolivars (just over 1 USD), while the compulsory 1.5 million bolivar food voucher has gone up to 2.19 million bolivars so the total national minimum wage now stands at 5.19 million bolivars, which is the equivalent of 2 USD on the black market. Minimum wages are determined by the sum of the national wage plus food vouchers, which is the minimum companies can pay their employees.
Pensions went up from 1.4 million bolivars to 3 million bolivars (just over 1 USD on the black market).
“I’m going to decree that minimum wages go up to 3 million bolivars and food vouchers to 2,196,000. This means that as of today, workers will receive 5,196,000 bolivars as a minimum wage,” said Maduro in Caracas.
This is the fourth pay rise for minimum wages this year, which will come into effect today, and was announced at a time when monthly inflation exceeded 100% in May.
The announcement has received criticism from opposition groups and experts, who said that this is just feeding the fire of hyperinflation.
Former presidential candidate Henri Falcon complained that while the minimum wage is 5.19 million bolivars, the basic food basket costs over 200 million.
“What a mockery they are making of the Venezuelan people! Another Government achievement: increase the minimum wage so that they can buy two kilos of meat instead of one! More hunger! And not a single well-aimed measure to tackle the financial crisis,” he pointed out on Twitter.
Falcon, who proposed that the national economy be dollarized in his electoral campaign on May 20th which he lost to Maduro, pointed out that Venezuelans are earning in devalued bolivars and are paying prices in dollars.
Meanwhile, opposition leader Henrique Capriles pointed out that this new pay raise means nothing.
“Is it so hard for the Government to realize that the big problem they need to sort out is hyperinflation which has reduced wages to nothing? We continue to have the lowest wages on the planet. Listen to the People!” he wrote on Twitter.
Likewise, economist Luis Oliveros said that inflation in June “could well reach 200%” with this increase in minimum wages plus the devaluation of the bolivar on the black market.
“We are on a train heading for a precipice and the government is going full speed ahead,” he warned.