Venezuelan President Nicolas Maduro speaks during a press conference with international media correspondents at the Miraflores Presidential Palace in Caracas on Oct 17, 2017. Maduro said on Nov 12, 2017 the country would never default on its debt, a day before debt talks with creditors that will be overseen by two officials under sanction by the United States. (FEDERICO PARRA / AFP)
CARACAS - Venezuelan President Nicolas Maduro said on Sunday the country would never default on its debt, a day before debt talks with creditors that will be overseen by two officials under sanction by the United States.
Default will never reach Venezuela. (We) will always have a clear strategy and right now that strategy is to renegotiate and refinance the foreign debt
Nicolas Maduro, President, Venezuela
Vice President Tareck El Aissami and Economy Minister Simon Zerpa will meet with creditors in Caracas on Monday, Maduro said, contradicting earlier reports that sanctioned officials would skip the meeting to reduce investor anxiety about attendance.
"People have bet on Venezuela declaring default - never," Maduro said during his weekly Sunday broadcast. "Default will never reach Venezuela. (We) will always have a clear strategy and right now that strategy is to renegotiate and refinance the foreign debt."
The talks are aimed at beginning to restructure about US$60 billion in bonds.
US sanctions have made it practically impossible for Venezuela to refinance debt because US banks cannot buy newly issued Venezuelan bonds. Restructuring talks are equally problematic because the sanctions bar investors from dealings with several officials on the newly appointed debt commission.
Maduro's vow to restructure and refinance in such an environment has left investors wondering if he is in fact preparing the groundwork for default.
"Tomorrow we begin the first round of renegotiation and refinancing of Venezuela's debt. It will be presided by our companion Tareck El Aissami ... and the presidential commission that I have assigned to this task," he said.
He said 414 investors had confirmed their attendance, describing that as "91 percent of all holders of Venezuelan foreign debt." That figure seemed to contrast with the overwhelming response of investors contacted by Reuters, who said they were unlikely to attend.
Market sources said last week they had been told that officials sanctioned by US President Donald Trump's administration would not appear at the meeting.
Trump's administration has imposed several rounds of sanctions this year, accusing Maduro's government of undermining democracy and violating human rights.
Investors last week were optimistic about the meeting.
Bonds issued by Venezuela and state oil company PDVSA rallied on Friday as efforts to keep current on obligations fueled optimism ahead of the meeting.
Even though state-run power utility Corpoelec was declared to be in default on Friday for failing to make an interest payment on time, investors were heartened when the company said it had sent the money.
Maduro on Sunday said Corpoelec had indeed paid but that banks have been sabotaging such transfers, echoing frequent accusations that the country is besieged by an "economic war."
"What happens is that international banks hide the funds that have already been deposited - they hide them," Maduro said. "Citibank, you gangsters at Citibank, you have tried to do damage to our country on various opportunities."
Citi declined to comment.
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