In the wake of massive civil unrest in the socialist country of Venezuela, President Nicolas Maduro has announced during his weekly television show that a massive minimum wage hike will take place, according to CNN Money.
This move is happening in response to surging inflation that has made the bolivar, Venezuela’s currency, virtually worthless. The hike will bring the wage up from 40,638, to 65,021 bolivars per month, and will include a hike in food stop distribution, which Venezuelans can use as cash.
Venezuela’s financial troubles are only expected to deepen as the year goes on.
From CNN Money:
Unemployment in Venezuela is expected to pass 25% this year, and it could reach as high as 28% next year. The rate was 7.4% in 2015.
Venezuela’s economy shrank a massive 18% last year — its third year of recession — and it’s expected to be in the red this year, and next too.
Inflation is expected to surge to 720% this year and 2,068% next year, according to forecasts by the International Monetary Fund.
Venezuela is currently in the middle of a massive unrest, with citizens pouring into the streets to protest and riot against the government. The shortages of food and medical supplies has become so pronounced that three-fourths of its citizens are experiencing dangerous amounts of weight loss due to starvation.
In response, Maduro has promised to arm his loyalists — the Bolivarian militia — despite the fact that he campaigned for years to have his citizens’ weapons taken away.
Venezuela’s financial upheaval stems from a combination of massive drops in the price of oil, and mismanagement of the country’s private sector. Venezuela’s government owns, or has stake in, 511 companies, and 70 percent of them are going under. The government has also taken to seizing companies without warning, including a recent “illegal judicial seizure of assets” of a General Motors plant in Valencia.