Venezuelan President Nicolás Maduro on Sunday announced a dramatic economic plan designed to pull the country out of its economic death spiral.
The plan, which is centered on the devaluation and renaming of the state’s currency, was unveiled less than two weeks after an assassination attempt on Maduro.
“We are going through a re-balancing process,” said Maduro on Sunday. “This does not happen overnight.”
Starting Monday, the bolívar will drop more than 90% in value to become the “sovereign bolívar.” The new currency will be pegged to the state’s oil-linked cryptocurrency (the petro), meaning it will fluctuate in line with oil prices.
The plan, which Maduro describes as a “magic formula,” includes a substantial increase in minimum wage designed to offset the exchange rate – which will increase from about 285,000 bolívars per USD to 6 million.
The announcement was met with concern from employers, who worry they won’t have enough money to sustain the increase in minimum wage.
The economic and political chaos in Venezuela has driven roughly 7% of the population (2.3 million people) out of the country since 2015.
The migration is “one of Latin America’s largest mass-population movements in history,” says UNHCR spokesman William Spindler. “Many of the Venezuelans are moving on foot, in an odyssey of days and even weeks in precarious conditions.”
According to the United Nations High Commissioner for Refugees (UNHCR), more than 1 million Venezuelans have fled to Colombia during the past 15 months; Ecuador has received about 500,000 since the start of the year – including 30,000 this month.
This Saturday, governments in Ecuador and Peru announced a new rule requiring all Venezuelans seeking entry to show a valid passport at the border. The change was a shock for families who started their journey before the measure went into effect.
“My family is fragmented, destroyed. We’re no longer together,” said a Venezuelan seeking entry into Ecuador. “My son is in Peru, my daughter in Chile, I have yet another daughter who’s on her way to Poland…When will I get them all together again? My wife is in Venezuela. The situation is dire.”
Migrants are also facing increased hostility from residents of other countries.
On Saturday, a mob of Brazilians set fire to migrant camps in the border town of Roraima after a local store was robbed – allegedly by Venezuelans. Brazil dispatched 120 troops to deal with the incident, which sent roughly 1,200 Venezuelans fleeing back over the border.
Venezuelans had been blocked from entering Brazil until early August, when the state’s Supreme Court overturned a ruling by a judge from Roraima.
Editor’s note: Their is no pretending the Venezuela is still a function country, we are seeing the continued self destruction. Thank you socialism.