Drowning or waving? Maduro’s Petro turns to the high seas

If you are a sailor and heading to Caracas port, you better stock up on your Petros.

All foreign vessels calling at ports in Venezuela will now be required to use the country’s digital currency to pay for services, shipping industry publication Tradewinds has reported.

President Nicolas Maduro launched the Petro in late 2017 with the aim of circumventing US trade restrictions while also bringing in new revenue streams, as the country faces hyperinflation and the national currency, the Bolivar, continues its sharp downward slide.

According to maritime insurance body UK P&I, Venezuela’s maritime authority INEA will collect all fees for “services rendered to foreign flag vessels” using only the Petro.

The state-backed coin is, according to President Maduro’s government, backed by the country’s oil reserves and raised $5 billion after it went on public sale in March. Yet it has come under repeated criticism, both internally and from overseas.

Opposition politicians say it represents an illegal use of state funds and plan to challenge its existence in Venezuelan courts while many in the crypto industry have said its lack of documentation indicates it is probably a scam.

But none of this has stopped it gaining support from Moscow.

Officials from Russia and Venezuela met in Caracas at the start of this week, the Venezuelan state news agency Agencia Venezolana de Noticias said, to discuss strategic partnerships. One of the agreements made was that Maduro’s government will buy Russian truck parts and pay for them using Petros, with Russia saying it is considering other “international transactions” using the digital coin.

The Petro can be purchased using Russian rubles, Chinese yuan, Turkish lira and also Euros, as well as with crypto-currencies.

The government has so far announced the creation of four exclusive economic zones where the Petro will be accepted as a means of payment and from this month Venezuelans are able to buy houses and other property with the oil-backed crypto.

So, presumably, they will use Russian trucks to move into these homes.