CARACAS – Venezuelan President Nicolas Maduro ordered a 275 percent increase in the monthly minimum wage on Monday, the third hike this year, as hyperinflation drains the value of workers’ salaries.
The minimum wage rose to 150,000 bolivars ($8) from 40,000, lawmaker Francisco Torrealba, a former labor minister and close ally to the socialist president, wrote on Twitter on Monday. In addition, workers will receive a food bonus of 150,000 bolivars, he added. It’s the second time in a row the announcement has come via a lawmaker, rather than the president.
Despite the increase, the new 150,000 bolivars wage barely amounts to enough to buy 4 kg of meat. Annual inflation in Venezuela is currently running at around 50,100 percent, according to figures produced by the opposition-led National Assembly. The government does not provide data on price rises. According to Bloomberg’s Cafe Con Leche Index, inflation is running at 19,900 percent annually. Inflation pulverized the value of the previous minimum wage: 40,000 bolivars amounts to around $2 at the official FX rate.
Venezuela’s severe economic crisis, including hyperinflation, a private sector in ruins and a shortage of basic goods, has forced more than four million Venezuelans to leave the country, according to the United Nations.
In 2018, Maduro ordered six hikes to the minimum wage but Venezuelans’ purchasing power still ended the year lower. Maduro has tried to avoid increasing the minimum wage this year in an effort to curb inflation that has included austere economic policies from the central bank.