Venezuelan President Announces 'Petro', Plans To Uplift Country's Economy

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Venezuelan President Nicolas Maduro said Sunday his country would create a cryptocurrency called the "petro" as it faces a "financial blockade" in the midst of crippling US sanctions.

President Maduro provided few details about the currency launch, and how he plans to revive the economic situation of his country.

Mr. Maduro said Sunday that the new currency would be called the "petro" and be backed by the OPEC nation's abundant oil, gold and mineral reserves.

The petro, he said, would help Venezuela "advance in issues of monetary sovereignty, to make financial transactions and overcome the financial blockade". This type of currency is not traditionally supported by central banks or governments. Ironically, Venezuela's currency controls in recent years have spurred a bitcoin fad among tech-savvy Venezuelans looking to bypass controls to obtain dollars or make internet purchases.

Opposition leaders in Venezuela, reportedly, have rejected his idea. They outlined it needs congressional approval. Some were even doubtful about the new digital currency being launched at all since the country is dealing with a serious financial crisis. Moreover, the country is unable to fulfill basic needs such as food and medicine.

The Trump administration has levied sanctions against Venezuelan government officials, state oil executives and its debt issuance, hurting Venezuela's ability to move money around as it faces a heavy debt burden, according to the news agency.

Maduro views it as a fight against a Washington-backed conspiracy to sabotage his government and put an end to socialism in Latin America, and went as far as declaring a financial "world war".

Over the past year, the Venezuelan bolivar has plummeted 95.5 percent against the dollar on the black market.

For the millions of Venezuelans plunged into poverty and struggling to eat three meals a day, Maduro's announcement is unlikely to bring any immediate relief. "This has no credibility", said opposition lawmaker and economist Angel Alvarado. However, there is a high risk of the plan flopping.

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