US leads effort to pump $10bn into Venezuela's shattered trade once Maduro is out

Featured US leads effort to pump $10bn into Venezuela's shattered trade once Maduro is out

Having strangled Venezuela's economy with its ever-expanding sanctions, the US has now volunteered to negotiate a $10 billion trade aid package to give to Caracas – but not until its own protege is in power.

Speaking at a press conference on Saturday, US Treasury Secretary Steven Mnuchin stated that the US has been leading the effort to salvage the Venezuelan economy, which his own country has been choking off with the long and continuously growing list of punitive measures. The help will only be available to the "new government" of self-proclaimed "interim president" Juan Guaido, who Washington has been backing in a push for regime change in Caracas.

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"We're going to be working on trying to put together a consortium of about $10 billion of trade finance that would be available for the new government to spark trade," Mnuchin said.

Venezuela has been battling with soaring inflation, which made basic goods unaffordable for the general public and gave rise to a flourishing black market. A shortage of food and water as well as near-daily blackouts triggered mass migration from Venezuela, as its economy lies in tatters. The economic woes have been exacerbated by political turmoil, with the US and its allies betting on Guaido to exploit the economic hardship and incite a coup against the elected Venezuelan President Nicolas Maduro.

Mnuchin was speaking several days after the fifth meeting of 20 finance ministers from the group of the so-called "friends of Venezuela" that he hosted at the Treasury Department on Thursday. The meeting also featured the chief of Guaido's economic advisers, Dr Ricardo Hausmann.

Speaking after the meeting, Mnuchin said that the ministers agreed to "support robust engagement by the international financial institutions to assist interim president Guaido's government as it prepares for new elections," noting that "very significant trade finance" would also be needed to revitalize the country's private sector.

For now, though, the US and about 50 countries that have vouched for Guaido will keep pushing to see him come to power.

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"We will continue to support Venezuela in its transition to a legitimate government as soon as possible to meet the people's aspirations for a better life and democratic future," Mnuchin said.

The US have already disrupted much of Venezuela's oil trade, which is Caracas' primary source of revenue, by confiscating assets of Venezuela's state-run oil and gas giant in the US and barring American customers from paying for Venezuelan oil, which led to a sharp drop in exports. In a fresh batch of sanctions on Friday, Washington placed nine oil tankers and four companies on the US Treasury blacklist. 

Mnuchin said that US officials took up the issue of financial aid to Venezuela with representatives of the International Monetary Fund (IMF) and World Bank. The IMF has yet to agree to the idea, however: Managing Director Christine Lagarde said on Saturday that it would take the “large majority” of its 189 members to greenlight the aid package, which is currently far from assured.

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