The president of Venezuela, Nicolas Maduro, announced that the minimum wage of workers in the country that are linked to petro would be increase. Maduro revealed in the II Workers’ Congress that the salary’s new value would now be half a petro, which is the national crypto, and its value is hovering close to $59. As opposed to the previous minimum wage of 7 Venezuelan bolivars (VES), this marks an increase of almost 1,800%. The national crypto introduced in Venezuela is backed by oil and some other natural resources in the country. Maduro was speaking to state workers when he made the announcement in the II Workers’ Congress.
As far as the issue of the monthly salary increase is concerned, Maduro stated that the minimum wage is a festering and penetrating wound since it depends on national income. He added that they had come up with a plan for debate in order to ensure recovery of minimum wage of all collective contracts and wage tables. The official petro page disclosed that the new monthly wage would now be fixed at $29.10. However, it should be noted that Maduro did not reveal when this increase would go into effect. But, he did add that there were already a lot of workers who were earning more than the minimum wage that has been newly announced.
He asserted that a lot of salaries paid on the street, particularly where the private sector is concerned, are already around $100 and $150. The president said that this was because the products are sold in dollars, collected in dollars and then taxes are paid accordingly. He also disclosed that their tax collections were good, better than they had been. Moreover, this is certainly not the first time that the Venezuelan president has made an announcement related to the minimum wage increase connected to the national cryptocurrency.
Back in 2018, Maduro had announced a wage increase that had seen the minimum monthly wage reach half a petro, which would have been around 1,800 VES at that time. Unfortunately, there had been currency devaluation, which had kept the wage price static in VES, which had caused the purchasing power of Venezuelan workers to suffer. There have been some doubts expressed in local media related to the real application of the petro peg. Likewise, there have also been concerns about whether the wages will be paid by the government as per the dollar value of the crypto, or it will only be used as a temporal unit of account.
It is also possible that national bank resources could be used to pay workers with petro directly, but Maduro’s speech did not disclose any of these details. However, this move is part of a petro push from the national government. Payments and transactions conducted in petro will not be subject to the newly approved tax, which is applicable on payments in dollars, or any other crypto that hasn’t been issued by the government. This would make petro a good choice for payments.
