Venezuela Defaults on Foreign Debt Repayments

November 15th, 2017

Via: Radio New Zealand:

The ratings agency said the South American nation had failed to make $200m in repayments on its foreign debt.

Venezuela’s state-run oil company PDVSA has also been declared in default by rating agencies Fitch and Moody’s.

The news came just hours after the government met investors in Caracas to try to renegotiate its debt.

Standard & Poor (S&P)’s declares a “selective default” when a country has failed to pay one or more of its financial obligations when it came due.

In the case of Venezuela, the government of President Nicolás Maduro failed to make $200m in payments on two global bond issues by 12 November, when a 30-day grace period expired.

S&P said Venezuela is also overdue on four other bond payments worth a total of $420m but that the grace period has not yet expired on those payments.

Venezuela’s total external debt, which also includes loans from countries like Russia and China, is thought to be as much as $140bn.

2 Responses to “Venezuela Defaults on Foreign Debt Repayments”

  1. Windhorse says:

    Usury Quiz: Choose the BAD leader(s) of a country:
    A) Opts to pay $200 million in interest to banks and countries holding debt instead of feeding his starving people
    B) Opts to not pay the $200 million interest to feed his starving people?
    C) The leader of a country holding $3 billion of that debt who extends repayments for 10 years with minimal payments in the first six years?

  2. soothing hex says:

    If profits go to wages rather than loan repayments then demand may go up, and if production slows or stays steady as investments go down or remain low, demand for imports and inflation might as well ensue. Too bad your debt is not denominated in local currency. Anyway with imports up and export prices up, this may spread inflation to partner countries and reduce their debt burden.

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