Venezuela Gasps On Capitalist Bond Buying: Goldman & Spin

by Garry Watts June 6, 2017, 5:34
Venezuela Gasps On Capitalist Bond Buying: Goldman & Spin

When that meeting was announced last month, Venezuela said it was withdrawing from the OAS in protest.

Even at 31 cents on the dollar, Nomura is taking a risk buying the bonds.

"Given the unconstitutional nature of Nicolas Maduro's administration, its unwillingness to hold democratic elections and its systematic violation of human rights, I am dismayed that Goldman Sachs chose to enter this transaction with the Maduro regime", Borges wrote in a letter earlier this week.

Fintech Advisory Inc., a New York-based investment fund, previously agreed to buy $1.3 billion of PDVSA bonds in a repo transaction providing at least $300 million of cash, Reuters reported in early April. Protests against President Nicolas Maduro's government have left dozens dead in the last two months.

"Here are the faces of the people who have led us to ruin", he added, as some women handed food, shoes and other supplies to the young men battling the security forces. "The OAS cannot continue to be used by a country for a political lynching against the government of Venezuela, it is regrettable that a group of brother countries has been biased in their appraisals and focus", said Nicaraguan Ambassador Luis Ezequiel Alvarado. "It has given support to repression and systematic violations of human rights", said Eduardo Lugo, co-founder of SOS Venezuela New York.

"We are invested in PDVSA bonds because, like many in the asset management industry, we believe the situation in the country must improve over time", the statement said.

The National Assembly also approved a motion late Tuesday to petition the U.S. Congress to probe the deal, which lawmakers said will prop up the country's embattled president.

"We believe there is an worldwide role in the rebuilding of trust among the main political actors in Venezuela as well as the reduction of tensions", Shannon said.

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The statement did not include the price of the bonds or the amount purchased.

What might seem like a wise investment could become more complicated for Goldman Sachs and other investors, after National Assembly president Julio Borges threatened on Monday to withhold payment on the bonds.

Mr Maduro says the protests are a violent attempt at a coup and insists the country is the victim of an "economic war" supported by Washington. Allies, which include fellow leftist nations and small Caribbean islands that receive cheap Venezuelan oil, defended Maduro during the OAS session, saying foreign powers were meddling in Venezuela's internal affairs.

The government of President Nicolas Maduro has been under attack by OAS chief Luis Almagro, who has vocally backed Venezuela's opposition and promoted foreign intervention in the country, leading Caracas to begin the process of withdrawal from the global body.

Borges said the National Assembly will open an investigation into the matter and he will recommend "to any future democratic government of Venezuela not to recognize or pay these bonds".

Goldman Sachs is being heavily criticized for giving Venezuela's government close to a billion dollars.

Goldman didn't comment on Borges' letter. "No", she said in an interview with "Closing Bell ".

The OAS meeting at the group's headquarters in Washington, however, was suspended because members could not agree on how to handle the Venezuelan crisis - a development that Foreign Minister Delcy Rodriguez celebrated as a victory.


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