Raising Hyperinflation

Your daily briefing for Tuesday, May 1, 2018. Translated by Javier Liendo.

Photo: EPA retrieved

Nicolás announced the third wage hike in just four months of 2018, effective starting this Monday, which is now the 44th raise in 19 years of chavismo, presenting it as an accomplishment and not as the evidence of our economic collapse. The minimum wage went from Bs. 392,646 to Bs. 1,000,000 and food stamps, from Bs. 915,000 nto Bs. 1,555,500. The Tax Unit (UT) went from Bs. 500 to Bs. 850. This is yet another raise that wasn’t consulted with the rest of the economic sectors, and it’s useless so long as the government doesn’t take measures to halt hyperinflation, which already stands at 13,000%, compared to the 1,200% minimum wage hike. Pensions went from Bs. 392,646 to Bs. 1,000,000 and the “economic war” bonus rose to Bs. 400,000. Bonuses for carnet de la patria holders increased, from a two-member family that will get Bs. 500,000 to a ten-member family that will get Bs. 2,580,000. The bonus for people with disabilities and for pregnant women will be Bs. 1,000,000; while the monthly bonus (called “working class” because it’s May) will be Bs. 1,500,000. He had the nerve to joke about the possibility of giving a bonus to the male audience for the size of their bellies, “that’s expensive to maintain,” he said. All the raises will be covered with BCV financing; you’ll see why when you get to the section on PDVSA below.

Other absurdities

Nicolás read incomprehensible figures (in both dollars and bolivars) to show the success of the Expo Venezuela Potencia, promising that after May 20 he’ll develop “economic articulation fairs” and he’ll stop the “criminal economy that’s killing the Venezuelan people.” He claimed to have cared and perfected el finado’s legacy to protect the working class and blamed all economic distortions on a complot created between Miami and Colombia “to rob the people.” At least he admitted he’s way beneath the current economic challenges, not without first claiming that without a socialist government, Venezuelan would already be a battlefield; evidence of how little he reads about deaths caused from malnutrition, treatable diseases, maternal deaths and murders. Since they lost all interest for appearances long ago, he blithely said: “We’ll check all carnet holders, we’ll seek their oaths, call them and teach all carnet holders that they must enter with their carnet in PSUV’s webpage starting this Sunday and take someone to vote (…) All carnet holders, either by carnet de la patria or by PSUV, must go vote. I scratch your back, you scratch mine.” He also restated that Venezuela doesn’t need the “scraps” of other countries, thus denying the possibility of a humanitarian channel.

Against the TSJ in exile

A group of justices from the Supreme Tribunal in exile denounced the raids to their homes and offices carried out by agents of the Bolivarian Service of National Intelligence (SEBIN). Pedro Troconis denounced the forced entry to his office without a search warrant; Elenis Rodríguez denounced that they raided her mother’s house (she suffers from Alzheimer’s,) and lawmaker María Gabriela Hernández said that Rodríguez’s sister was summoned as a witness by SEBIN. They also raided the offices and homes of Antonio Marval and Miguel Ángel Martín; as well as an inn owned by justice Cioly Zambrano and the home of justice Sabino Zamora. Several lawyers emphasized that in case there’s criminal liability against the justices, it must be individual, so persecuting their relatives is a violation of their rights. This happens the same day that former presidential honor guard Luis Fernando González Seyas revealed that he was ordered to murder Pimero Justicia leader Tomás Guanipa.

Selective default

Despite the poor treatment they’re giving their employees, Hydrocarbons minister Ángel González said that Venezuela will seek financing with its private partners to increase the production of light and medium cruel barrels by a million, which is the government’s plan to take advantage of the recent rise in oil prices. They’ll have to move faster because OPEC’s oil output in April reached its lowest level in a year due to Venezuela’s oil-pumping problems (in April, output dropped to 1.5 million bpd,) a decline that no other country in the organization has yet taken advantage of.  Additionally, three sources in the financial sector told Reuters that PDVSA started paying some $100 million in interests to some holders of the bond due in 2020. The money reached some bondholders through the American custody firm DTC. Remember that the government had already paid pending interests to investors in the PDVSA 2022 bond, which was mostly bought by Goldman Sachs Group Inc. Analysts caution that this kind of selective default could detonate legal actions from less favored bondholders.


  • The OAS’s 70th anniversary was commemorated with the holding of a Permanent Council session that discussed the Venezuelan crisis again. They didn’t reach a definitive resolution but there was a broad exposition of arguments and information describing this crisis, both for the country itself and for the region. Secretary general Luis Almagro said that the only economic war is the one promoted by the government, adding that health and food ceased to be rights and that the situation of millions of Venezuelans is the worse than that of “a war-torn country.” On Twitter, the accounts @VE_ONU and @OVCSocial covered the entire session in detail.
  • Samuel Moncada, the government’s representative before the OAS, acknowledged that there are “great economic difficulties,” but still said that the debate was “hypocritical”. He accused the U.S. of promoting a coup d’état; the OAS of preparing a case to “intervene” the country; cardinal Baltasar Porras of being a “political agent” and the Episcopal Conference of undermining peace. Moncada claimed that they won’t be able to replace the government (?), saying that the sanctions against government officials are “measures of coercion” (brilliant, eh!) and denied that this is a failed State, promising to resolve the humanitarian crisis with free elections (hahaha!), without tutelage from international organizations.
  • Earlier, State deputy assistant secretary for Western Hemisphere Affairs Michael Fitzpatrick said that the U.S. is willing to lift economic sanctions against Venezuelan “when the government or officials change their course (…) when they are willing to re-establish accountability over their control of financial flows, when they can and wish to reinvest in the county, when they are willing to take simple steps to respect the Constitution and the National Assembly, to open humanitarian channels.”
  • Yesterday, the Brazilian Prosecutor’s Office filed a new corruption accusation against Luiz Inácio Lula da Silva, in prison since April 7 for a term of 12 years. The accusation extends to three of his former ministers.

– The Islamic State (IS) claimed responsibility for the double suicide attack in Afghanistan that killed at least 25 people, among them nine journalists.

Starting this Tuesday, May 1, by order of the BCV, all monetary figures must be expressed in (strong) bolívares and sovereign bolívares. PSUV didn’t confirm their celebration for happy workers today (and called for one on May 6,) but the Federation of Health Workers and the Broad Front for a Free Venezuela -Frente Amplio Venezuela Libre- did announce their own protest demonstrations.

Naky Soto

Naky gets called Naibet at home and at the bank. She coordinates training programs for an NGO. She collects moments and turns them into words. She has more stories than freckles.