IMF freezes contact with Venezuela gov’t

Published April 11, 2019, 12:00 AM

by manilabulletin_admin

WASHINGTON (AFP) – The International Monetary Fund (IMF)will not have any contact with Venezuela, nor allow the country to access its reserves held by the institution, until the international community recognizes a government in Caracas, an IMF spokesman said Wednesday.

The country’s leadership has been in question since late January when national assembly leader Juan Guaido challenged embattled President Nicolas Maduro as the country’s acute economic crisis worsened.

”Any IMF engagement with Venezuela, including responding to potential financial transaction requests, is predicated on the issue of government recognition being clarified,” an IMF spokesman told AFP.

”We are guided by our membership on that issue, and at this point, this determination has not been made.”

The United States is among some 50 countries that recognize Guaido, the opposition leader who declared himself interim president in late January in a bid to replace Maduro. Guaido has branded Maduro’s rule illegitimate because of what Guaido calls fraudulent elections last year in which Maduro won another term in office.

Maduro, who is backed by Russia and China, is under increasing pressure as the economy implodes and the exodus of Venezuelans continues amid a worsening humanitarian crisis.

Earlier Wednesday, US Vice President Mike Pence asked the United Nations to recognize Guaido as the legitimate leader of Venezuela, telling the Security Council, ”Nicolas Maduro must go.”

The IMF has previously said it is awaiting a decision by its members on recognition of a government in Caracas, which would take a majority of the voting shares in the fund, although the issue would not necessarily be decided by a formal vote.

The United States holds the biggest share of IMF votes, at 16.5 percent, giving it veto power over most decisions.

All of the 189 members of the global crisis lender are required to keep a minimum level of foreign currency reserves on deposit at the IMF but because of the limbo in Caracas neither Maduro nor Guaido could have access to those funds.