🤑 It doesn’t get more affordable. Grab this 60% OFF Black Friday offer before it disappears…CLAIM SALE

Venezuela opposition pledges equal treatment for creditors in possible restructuring

Published 07/03/2019, 05:52 PM
Updated 07/03/2019, 05:56 PM
Venezuela opposition pledges equal treatment for creditors in possible restructuring

CARACAS (Reuters) - Venezuelan opposition leader Juan Guaido's economic advisors have proposed treating most creditors equally in a possible debt restructuring should the coalition oust President Nicolas Maduro from power, according to a document published on Wednesday.

The South American country has debts worth around $200 billion to a diverse group of bondholders, commercial suppliers to state-owned firms with unpaid accounts receivable, and companies whose Venezuelan assets were expropriated.

It is currently experiencing its worst economic crisis in history, marked by hyperinflation as well as chronic food and medicine shortages. The government has defaulted on most of its debt, but creditors are reluctant to negotiate a restructuring due to U.S. sanctions intended to force Maduro from power.

The promise of "equal treatment" is intended to discourage creditors from filing lawsuits against Venezuela or state-owned oil company PDVSA in U.S. courts in order to accelerate payment, according to the document written by Guaido's lawyers released by the opposition-controlled National Assembly.

"We will not give any preferential treatment in the renegotiation to those claims that have been the object of a judicial decision," the document reads. "As a result, the authorities request all parties to abstain from initiating judicial actions."

The move comes more than five months after Guaido, a lawmaker who leads the Assembly, invoked Venezuela's constitution to assume an interim presidency, arguing Maduro's May 2018 re-election was illegitimate. He has been recognized by dozens of countries, including the United States.

Nevertheless, Maduro retains control of state functions and the backing of key allies including Russia and China. He calls Guaido a U.S.-backed puppet seeking to oust his socialist government in a coup.

There would be several exceptions to the opposition's promise of equal treatment, according to the document. They would include bilateral loans from Russia and China, debt deals subject to corruption investigations, and debt subject to disputes in international arbitration tribunals.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.