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Venezuela’s public companies quadruple foreign currency sales to central bank -Breaking

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© Reuters. FILEPHOTO: A bus driver assistant holds Bolivar Banknotes. They are worth between 0.01 and $0.25 US Dollars. REUTERS/Leonardo Fernandez Viloria

CARACAS (Reuters – Venezuela’s foreign currency sales to South America’s central banks quadrupled by 2021 according to a document Reuters obtained.

Two people familiar with the subject said that advisers to President Nicolas Maduro talked to bondholders in Europe and America about Venezuela’s economic potential at a conference organized by the Spanish Chamber of Commerce in Venezuela.

The document included data that was discussed during the conference call, including economic indicators and information that showed that Venezuela’s central banks received $3.39 Billion in foreign currency in 2021. This is an increase of $743 M in the previous year.

The foreign currency that was not in circulation was used for the stability of the exchange rate between bolivars (the dollar) and government expenses.

Foreign currency sales have increased to the Monetary Authority due to an increase in PDVSA’s oil production and exports despite U.S. sanction. The same document stated that Venezuela’s November oil production reached 871,000 barrels per hour.

Venezuela withdrew payments from bondholders after it suggested debt negotiations in 2017. The country’s crisis prompted the suspension of payments to bondholders. Additionally, sanctions prohibited Americans from dealing with Venezuelan officials.

Venezuela had a similar attempt at renegotiation in 2020, but it was not successful.

Both the Spanish Chamber of Commerce and Venezuela’s Ministry of Communications did not respond to our requests for comment.

Advisors to Vice-President Delcy Rodriguez reminded bondholders of the need for economic policy reforms and suggested the possibility of capital injections into oil, tourism, and agricultural sectors. Sources said that Venezuela’s economic growth in the third quarter was 7.6%.

The country is in deep recession, with high prices and long periods of unemployment. The government relaxed financial regulations in order to assist businesses. But, they aren’t enough to ensure a complete recovery. Analysts agree.

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