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The Venezuelan government unveiled the new bank on notes on Friday, which will have five zeros slashed from the bolivar.
Venezuelan President Nicolas Maduro declared Monday a national holiday to mark the launch of the new currency, which is linked to Venezuela's contraversial cryptocurrency, the petro. The new notes will function alongside the old currency during the initial transition period, until a complete phase-out.
Maduro described the change as a ‘historic moment’ for the country, with more changes to the minimum wage hike taking effect as early as September, including a more than 3,400 % minimum wage hike and a rise in the price of fuel.
“We need a complete economic revolution, like the one I have already activated and at the centre of it is work, the payment and protection of work,” Maduro said in a video posted to Facebook.
Analysists are questioning if the move will change anything, with the country already facing one of the worst hyperinflations in history. Prices have already been rising rapidly, sometime twice a day over the past 7 months.
The introduction to the new currency hasn’t come without criticism. Economists have raised concerns things could worsen, with the International Monetary Fund (IMF) predicting inflation could rise to 1 million % by the end of 2018.
US President Donald Trump passed sanctions on Venezuela within 24 hours of Maduro’s presidential election in May 2013, attempting to control the government from borrowing against, public assets.
Maduro accused the US of waging an ‘economic war’ on Venezuela, saying the sanctions were an attempt to force the country to default on its debt.
According to the IMF, Venezuela’s gross domestic product (GPD) has dropped by 45% since Maduro was elected in May 2013.