“After this payment, I decree a refinancing and a restructuring of all external debt and all of Venezuela’s payments,” Maduro said in a statement broadcast on state television.
He said the efforts to modify reimbursement of his country’s debt pile – estimated at US$150 billion – would start after state-oil company PDVSA pays the US$1.2 billion in maturing bonds.
US sanctions imposed on Venezuela in August, however, threaten to complicate Maduro’s ambition. They ban US trade in any new bonds issued by the Venezuelan government or PDVSA – a needed step in any restructuring.
Much of Venezuela’s debt is held by China and Russia, to be paid off in oil – the resource that underpins the Venezuelan economy. The country has less than US$10 billion in foreign currency reserves.
Credit-rating agencies are increasingly warning of the risk of a Venezuelan debt default.
But up to now, Maduro’s government has prioritised repayments over all other expenditure – including food and medicine imports needed as the economy deteriorates.
A default could see investors try to lay claim to PDVSA assets, including tankers, oil in shipment and subsidiaries, such as the Citgo refiner and service station network in the US. According to estimates by private consultancies, Venezuela has a debt mountain of US$150 billion, of which US$45 billion is public debt, US$45 billion is owed by PDVSA, US$23 billion is owed to China, and US$8 billion is owed to Russia.