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This article is more than 6 years old

• This is an updated version of a previous article.

Amid galloping inflation and shortages, the Venezuelan government has sent its army to occupy electronics stores that it accuses of profiteering.

Earlier this week long lines of shoppers queued overnight for a chance to get militarily enforced discounts on computers, plasma TVs and appliances. As a washer-dryer was wheeled out of the JVG store in Caracas for its buyer, the crowd of consumers chanted, "si se puede" (yes we can).

Warning in a televised speech that price controls will be increased in coming weeks, President Nicolás Maduro said: "We can't just close the businesses, the owners have to go to jail."

But the socialist government's intervention has raised fresh concerns about an economy that has 50% annual inflation and a currency black market that trades dollars at nine times the official rate. Amid constant price rises, people struggle with shortages of food, medical supplies and other necessities.

Maduro, who took over in April after the death of Hugo Chávez, says his country is fighting an "economic war" against the opposition, the CIA and other enemies whom he accuses of trying to destabilise Venezuela.

Underscoring the mood of paranoia, Venezuelan authorities recently detained a US journalist, Jim Wyss of the Miami Herald, for two nights after he tried to cover a border area notorious for illegal currency transactions and food smuggling. He was released last weekend.

Facing municipal elections on 8 December, the president appears to be attempting to assert his authority with bold initiatives – and the occasional eccentricity – redolent of his predecessor. He has announced the creation of a ministry of supreme social happiness and stepped up controls on "profiteers".

On Thursday Maduro announced the arrest of more than 100 "bourgeois" businessmen for alleged price-gouging. "They are barbaric, these capitalist parasites," the president thundered in the latest of his lengthy – and daily – speeches. "We have more than 100 of the bourgeoisie behind bars at the moment."

The government is preparing a law to limit Venezuelan businesses' profits to between 15 and 30% , he said.

The targets for enforced discounting were three electronics chains: Daka, a retail chain similar to Best Buy or Currys, JVG and Mundo Samira, which both sell household appliances.

All are accused of profiteering. Although the government says it granted Daka a preferential exchange rate of 6.3 bolivars to the dollar to import goods, the company's shops allegedly sold the commodities at a similar rate to retailers, who have to rely on higher black market rate.

Maduro said the retailer was guilty of theft and encouraged shoppers to empty its stores. Five shop managers were arrested.

"This is for the good of the nation," he said. "Leave nothing on the shelves, nothing in the warehouses … Let nothing remain in stock."

Following his call, YouTube clips posted showed people looting a Daka store in Valencia.

At the JVG store in Caracas's Los Caminos neighbourhood on Monday, people queued three blocks for goods that were marked down by up to 60% under the supervision of about a dozen national guards in olive green uniforms with assault rifles.

The troops took the names of those waiting and let them in the store ten at a time. One man, who gave only the name Joel Morón, said he had been in the line since Saturday.

"Importers have been indiscriminately raísing prices. I wanted to buy a refrigerator for my mum. Before it cost 50,000 bolivars. Today I was told it cost 16,000," he said. "We had given up. We thought prices would continue to hike. These measures make me recover my dignity."

Not everyone was happy. An importer, Iván Pérez, was at the shop to collect merchandise he had bought before the mark down.

"Everything here works like the rest of the country – like crap," said Pérez. "This is evidently a political move, but I think it's actually just dividing society more. Some will be happy, but others understand it damages us and the economy. This will increase scarcity."

The president of Fedecamaras, the private enterprise chamber, has admitted there have been some cases of overpricing in the retail sector.

One of Maduro's likely targets is EPA, the country's biggest chain of DIY superstores. Crowds have already begun gathering outside the company's shops in expectation of price cuts.

Maduro said in his evening speech that he would be sending officials to the local operation of US tyre maker Goodyear. "Goodyear has to lower its prices even more, 15% is not enough: the inspectors have go there straight away," he said.

The president has also asked the national assembly for the power to rule by decree. If such a law is passed, Maduro has promised to punish currency speculators, control inflation and reduce excessive profits on "everything".

Since Maduro took over from Chávez, Venezuela's economic woes have worsened. Although the country is oil rich, with the world's largest deposits, other industries have collapsed as a result of price controls, government mismanagement and land appropriation.

Once a major producer of agricultural commodities, Venezuela has to import most of its food. Even though malnutrition has fallen as a result of state-subsidised food programmes, it has become hard for many people to secure basic necessities because dollars are in short supply.

In the past year, residents of Caracas have struggled to buy rice, coffee and cornflour, there has been a run on toilet paper.

Wine and bread supplies ran so low that Catholic priests were instructed by bishops to conserve what was left so that they did not run out during mass.

Despite abundant oil, poor infrastructure has also led to power cuts. In September 70% of the country was left without electricity for hours.

Although Venezuelan trade is officially in surplus thanks to its oil exports, at least one trade partner is experiencing delays in payments. Uruguay's president Pepe Mujica is reportedly scheduled to meet Maduro early this week to try to resolve his country's late reimbursement for beef, chicken and other goods.

The managing director of the IMF, Christine Lagarde, warned this month that Venezuela was under economic stress and would have to take some difficult policy decisions soon because it was running down its currency reserves. Pressure for a hefty devaluation of the bolivar is growing – a move that would make it all the more difficult to bring shortages and rampant inflation under control.