By Deisy Buitrago
May 14 (Reuters) – Restructuring Venezuela’s sovereign debt and that of state oil firm PDVSA will bring the country “out of the shadows” of the global financial system, interim Central Bank President Luis Perez said on Thursday.
Venezuela announced on Wednesday it would begin restructuring its external debt, which has been in default since 2017 and is estimated by analysts to exceed $150 billion in unpaid bonds, arbitration awards and interest.
The restructuring “brings the Republic out of the shadows in the international financial world,” Perez told Reuters in an interview.
“The whole world is watching with enthusiasm and approval.”
Perez did not offer details of the debt restructuring plan, saying the information falls under the purview of the country’s representative before the International Monetary Fund, Calixto Ortega.
Venezuela is seeking to reintegrate into the global financial system following the re-establishment of relations with the IMF and the World Bank, which were suspended in 2019 over government recognition disputes.
“Breaking relations with the International Monetary Fund should never have happened. It was a consequence of the sanctions,” Perez added. A Venezuelan delegation will travel to Washington at the end of the month to meet with the entity.
The IMF has indicated it could provide support via approximately $5 billion in special drawing rights (SDRs) that remain unused.
Interim President Delcy Rodriguez, who came to power in January after the U.S. captured President Nicolas Maduro, aims to use the resources for the electricity sector.
VENEZUELA’S CENTRAL BANK SEES “CRUCIAL” U.S. ROLE
Perez added that initial communication with the Fund has focused on developing statistics regarding prices and the external sector.
Perez also forecast that Venezuela’s economy will grow about 8% this year, with inflation expected to slow to single digits.
The economy expanded 2.5% in the first quarter, buoyed by a 3.1% rise in non-oil activity while the oil sector contracted 2.1%.
Following Venezuela’s resumption of diplomatic relations with the United States in March, the central bank now maintains closer ties with the U.S. Treasury Department, Perez added.
“The United States is playing a crucial role,” Perez said. “It is impossible for the United States government not to play a leading role in lifting the restrictions as well.”
Washington issued a license in April allowing the central bank to conduct transactions with entities abroad.
Perez added the bank is preparing an agreement with auditors Binder Dijker Otte (BDO) to review its financial statements.
(Reporting by Deisy Buitrago; Editing by Kylie Madry, Daina Beth Solomon)
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