CARACAS, Venezuela — The exodus of Venezuelans gained pace as the government’s plans to address the collapsing economy fueled anxiety, while tensions grew in neighboring countries that have strained to absorb refugees.
Over the weekend, Venezuela’s battered business sector warned that President Nicolás Maduro’s plans — including a leap in the minimum wage, new taxes and a currency devaluation — would paralyze the economy and drive more people out. About 2.3 million have fled since 2014, according to United Nations estimates.
Meanwhile, a mob burned a refugee camp in Brazil on Saturday in retaliation for a robbery purportedly committed by four Venezuelans, prompting that country’s president, Michel Temer, to order 120 troops to the troubled border. In Ecuador, the government on Saturday began requiring Venezuelans to have a passport, which are nearly impossible to obtain. Peru said it would follow suit after police arrested five Venezuelan men accused of planning a bank robbery.
The president’s new measures include a new currency called the sovereign bolivar, which will lop five zeros off the existing tender. Many economists said the move fails to address the real cause of inflation: uncontrolled printing of money. The rollout comes as Maduro plans to raise the minimum wage to about $30 a month from less than $1. Economists warn the measures will drive inflation even higher than the 1,000,000% the International Monetary Fund projects this year. The government, which is in default on $6 billion in debt, is expected to print more bank notes to make up for a loss of export earnings that has come with the drop in oil production. The president has also pledged to raise the price of subsidized gasoline, which in the past has sparked riots.
An expanded version of this report appears on WSJ.com.
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