Venezuelan President Nicolás Maduro said late on Thursday that the country would restructure and refinance its debts after the state-owned oil company makes one final payment, a long-awaited move by the indebted country grappling with a bruising recession since the collapse in crude prices. In an address to the nation, Mr Maduro called time on Venezuela’s ability to service the roughly $100bn of debts accrued between the sovereign and PDVSA after years of borrowing.
The move to restructure its obligations is likely to send shockwaves through the market for Venezuela’s complex debt structure, which has whipsawed as investors awaited news of payment on each of the country’s bonds over the past year. Mr Maduro said he had ordered the payment of $1.1bn on PDVSA obligations due on Thursday, and the company said in a statement that it had initiated transfers to JPMorgan Chase to cover the principal and interest due on the bond. “We have had to face a real global financial persecution,” he said. “They will not asphyxiate us, and we will never, ever surrender to the US empire.”
Mr Maduro said that the country had paid $71.1bn to bondholders since he took power in 2013, despite a $100bn drop in revenues due to lower oil prices. Mr Maduro has long resisted calls to stop payment on the debt despite a deepening humanitarian crisis taking hold across the country of more than 31m people. They will not asphyxiate us, and we will never, ever surrender to the US empire President Nicolás Maduro “Payment tomorrow [Friday] and then refinancing and restructuring.
Does not sound logical, but that is how chavismo is,” said Asdrúbal Oliveros, head economist at Caracas consultancy Ecoanalítica, referring the socialist movement founded by Mr Maduro’s predecessor, the late Venezuelan leader Hugo Chávez. “It’s hard to believe this announcement,” said Angel Alvarado, a Venezuelan opposition politician and economist. “There is simply no economic programme linked to the proposal. It looks like Nicolás Maduro has no real interest in renegotiating the debt and this could well be another of his tactics to distract the world — this time the international financial markets.”