CARACAS, Venezuela -- Residents across Venezuela's capital spent a nervous weekend bracing for drastic measures intended to rescue a downward-spiraling economy.
Banks will close today as they prepare to release the "sovereign bolivar," a new currency printed with five fewer zeroes in a bid to tame soaring inflation. In addition, President Nicolas Maduro said Friday that the minimum wage will soon jump more than 3,000 percent.
Maduro's government also has said that in late September, it will raise the price of gasoline, currently the world's cheapest, to international levels to curtail rampant smuggling across borders.
Economists say the package of measures is likely to accelerate hyperinflation rather than address core economic concerns, such as oil production that has plunged to levels last seen in 1947.
Lines on Saturday were longer than normal at a Caracas street market, where people stocked up amid uncertainty about what will come this week. Many were frustrated by bank-card readers that were slow to register or that failed altogether, forcing some to leave their goods and walk away empty-handed.
"You have to be patient," a shop worker selling grains told a growing line of customers. Many other stores remained closed, uncertain of what prices to set for their goods.
"I don't understand what Maduro said or what is happening, but everyone says things will get worse," Julio Ramirez, a 60-year-old supermarket worker in Caracas, said Sunday. "Tomorrow we will open, but I don't know what is going to happen after."
Venezuela was once among Latin America's most prosperous nations, holding the world's largest proven oil reserves, but a recent fall in oil prices accompanied by corruption and mismanagement under two decades of socialist rule have left the economy in an economic and political crisis.
Inflation this year could top 1 million percent, according to economists at the International Monetary Fund.
Inflation has made it difficult to find paper money. The largest bill under the outgoing cash system was the 100,000-bolivar note, equal to less than 3 cents on the commonly used black market exchange rate. A cup of coffee cost more than 2 million bolivars.
The new currency will have two coins and paper denominations ranging from 2 to 500. The lowest represents the buying power of 200,000 current bolivars while the highest stands in for 50 million.
The old and new currencies will remain in circulation together during a transitional period.
A lack of credibility is one of the main reasons why experts expect Maduro's plan to fail. The measures, they say, can only be superficial as long as the central bank continues to print money to cover government spending -- the cause of the problem that has accelerated the inflation rate.
Maduro said his plan aims to balance the country's fiscal deficit by increasing income through higher taxes and gasoline prices. But success seems unlikely, experts said, with the drop in oil income and with the government promising to pay private businesses' wages for three months to offset the wage increases.
"What the government gave was a confusing contradictory statement, like most things in today's Venezuela," said Steve Hanke, professor of applied economics at Johns Hopkins University and one of the world's leading experts on hyperinflation. He served as an adviser to Venezuelan President Rafael Caldera in 1995-96.
Adding to the recent confusion, Maduro said he wants to peg wages, prices and pensions to the petro -- a cryptocurrency announced in February that is not yet circulating. He said a petro would equal $60, with the goal of moving toward a single floating exchange rate tied to the digital currency.
A coalition of opposition leaders and union officials said Sunday that they are calling for a strike and protest Tuesday.
"The measures announced on Friday are not any economic recovery plan for the country," opposition leader Andres Velasquez said. "On the contrary, they represent more hunger, more ruin, more poverty, more suffering, more pain, more inflation, more deterioration of the economy."
Business owners say they fear that a sudden wage increase would make them unable to pay employees without sharply increasing prices, despite Maduro's call to help small and midsize businesses for the first three months.
Jesus Pacheco, who employs six people at his butcher shop in Caracas, said Sunday that he may have no option but to let go some of his employees to stay in business. He expects the slaughterhouse prices will go up for him.
"You're going to buy products, and they're more expensive," Pacheco said. "We are going to have to fire employees. What else can you do?"
Elsewhere, the Brazilian government made plans to send troops to the border town of Pacaraima after residents attacked Venezuelan migrants.
The government-run news agency Agencia Brasil said Sunday that the Public Security Ministry plans to send at least 60 soldiers of the elite National Force to Pacaraima. Calls to the ministry for details went unanswered.
Pacaraima is a major border crossing with Venezuela, and the economic and political turmoil has driven tens of thousands of people to cross into Brazil over the past few years.
Authorities said Saturday's violence broke out after a local store owner was robbed, stabbed and beaten in an assault blamed on four migrants.
Groups of residents then roamed the town, hurling rocks at the migrants and setting fire to their belongings.
The army's Humanitarian Logistics Task Force said Sunday that at least 1,200 migrants fled Pacaraima and returned to Venezuela to escape the violence.
Information for this article was contributed by Scott Smith and staff members of The Associated Press and by Rachelle Krygier and Anthony Faiola of The Washington Post.
A Section on 08/20/2018