Expat Village is edited and published by
Iain Williams in Caracas, Venezuela.
A Reuters story at www.reuters.com
CARACAS, April 30 (Reuters)
- Venezuela's President Hugo Chavez pumped up the minimum wage by 30
percent on Wednesday and said putting cash in workers' pockets came
before his battle with Latin America's highest inflation rate.
Hundreds of union members cheered as Chavez signed the decrees to raise wages, which will come into effect on May 1.
The
socialist president vowed to fight prices, which rose 22.5 percent last
year, but said the government was first committed to maintaining
workers' buying power.
He also raised public sector workers'
wages by 30 percent. The minimum wage will now be $372 per month.
Chavez said this was the highest in Latin America.
Many Venezuelan workers also receive benefits like subsidized food and housing.
Venezuela
raised interest rates on Wednesday to encourage savings and soak up
liquidity, as the country enjoys a bonanza from government spending of
record oil income.
Chavez urged workers to save, but with
interest rates still lower than inflation, many Venezuelans would
rather spend, spurring a major shopping spree on consumer goods.
A
series of debt issues has dampened inflation slightly in recent months
and the government has slowed growth in public spending.
Some
economists say the government will struggle to stick to spending caps
as its coffers fill with revenues from record high oil prices ahead of
local and state elections in November.
(Reuters reporting by Frank Jack Daniel)
Click here for more Venezuelan news
Expat Village is edited and published by
Iain Williams in Caracas, Venezuela.
