Venezuela begins this Wednesday the debt restructuring to overcome the financial blockade of sanctions and put the economy at the service of the people to advance prosperity, justice and social equality.

The Bolivarian Government formally launched on May 13 an integral and orderly restructuring process for the nation’s external public debt and that of its state-owned oil company, Petróleos de Venezuela S.A. (PDVSA), aiming to liberate the country from accumulated financial burdens and restore its economy to serve the people.

This strategic move, announced by the Ministry for Economy and Finance, seeks to guarantee prosperity, justice, and social equality for the Venezuelan population amidst ongoing financial challenges.

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The Ministry for Economy and Finance, in a statement, underscored that this measure intends to place the economy at the service of its citizens, freeing the nation from its accumulated financial burden.

Venezuela had historically maintained an impeccable record of solvency and timely fulfillment of its international obligations. However, its capacity to pay financial commitments was severely hindered starting in 2017, a direct consequence of the U.S. financial sanctions unilaterally imposed against the country. These coercive measures effectively deprived the South American nation of normal access to international financing, critically limiting its ability to invest in vital sectors such as health, education, electricity, water, infrastructure and productive recovery, thereby directly impacting the well-being of the Venezuelan people.

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Una publicación compartida de Ministerio del Poder Popular de Economía y Finanzas (@mineconomia_ve)

Text reads: “Statement: Government of the Bolivarian Republic of Venezuela announces debt restructuring process.”

Restructuration Objectives

The Venezuelan Executive in Caracas has announced a debt restructuring initiative described as responsible, nationalist and social, with the primary goal of allocating the country’s resources to the well-being of the Venezuelan people and stabilizing the national economy with the rebuild its financial capacity.

A statement issued by the Ministry for Economy and Finance underscored the core philosophy behind this action. It explicitly declared that “the nation’s resources must be allocated, first and foremost, to the well-being of the people of Venezuela and not be consumed by unsustainable financial obligations.” This statement emphasizes the governmental commitment to prioritize the social agenda over external financial pressures.

The primary objective of this restructuring initiative is to secure substantial debt relief, a measure considered essential for fostering inclusive growth and stimulating vital job creation across the country.

Sanctions Still Ongoing

The Vice Minister of Anti-Blockade Policies, William Castillo Bollé, clarified on his X profile that Venezuela entered a technical default in 2018 due to sanctions from the Trump Administration. He emphasized that prior to this, the country had maintained a perfect record regarding its debt obligations.

Castillo Bollé asserted that the “maximum pressure strategy” from Washington, specifically through Executive Order 13835 issued in May 2018, was responsible for blocking the country’s and Petroleos of Venezuela’s (PDVSA) debt, and impacted Venezuela’s financial operations and its ability to manage its international commitments.

Text reads: “A week ago, the United States issued License 58 that authorizes legal and financial advisory firms to contract with Venezuela for the eventual start of a process of restructuring sovereign debt and PDVSA. Today, the Bolivarian Government announces the start of a process aimed at restructuring external commitments. Venezuela went into technical default in 2018 due to Trump sanctions. (…) We insist: sanctions are not being lifted. Licenses allow for conditional activation of economic and financial processes that would flow much faster if the blockade were removed…”

Just a week ago, the United States issued License 58, which authorizes legal and financial advisory firms to engage with Venezuela regarding the potential initiation of a restructuring process for both sovereign debt and that of the Venezuelan oil corporation. In light of this development, the Bolivarian Government has officially announced the commencement of this crucial process.

Castillo Bollé, however, firmly clarified that despite this authorization, the sanctions themselves are “not being lifted.” In this sense, he stressed that these licenses merely “allow the activation of conditional economic and financial processes that would flow much faster if the blockade were eliminated.” Consequently, he reiterated the ongoing imperative to “continue fighting for the integral end of the illegal policy of economic coercive measures and the lifting of all sanctions.”

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