The debt of almost US$ 682 million that Venezuela owes the Brazilian government was one of the subjects of the meeting between special adviser to the Presidency Celso Amorim and Venezuelan President Nicolás Maduro last Wednesday, 9th. Amorim visited Maduro at the Palace Miraflores, seat of the Venezuelan government, in Caracas. It was the first public institutional meeting between authorities from both countries since Luiz Inácio Lula da Silva took office on January 1st.
According to Amorim, the Venezuelan government is willing to reimburse Brazilian coffers, although details about the payment were not part of the conversation in Caracas.
“I don’t know if it’s just a debt with the BNDES. There is a credit insurance issue. But I didn’t go on a technical mission, I just went with two direct assistants. There was no hint of debt denial and there is a total willingness to settle. It wasn’t up to me to talk about whether it will work once, twice, but there is a willingness to reschedule and reimburse”, stated Amorim to the Estadão.
The Venezuelan government has a total of US$ 682 million in arrears on its debt with the National Bank for Economic and Social Development (BNDES), according to data updated until December 2022 and available on the development institution’s website. Of the arrears, most of them, US$ 658 million, have already been covered by the FGE, the National Treasury’s guarantee fund. Venezuela still has US$ 123 million in debt installments due.
The BNDES even contracted US$ 2.970 billion in financing for works in the neighboring country, but of that amount, US$ 1.507 billion was released. The BNDES website lists seven Venezuelan public works carried out by Brazilian construction companies, with financing from the development bank.
Amorim’s trip to Venezuela was organized under the discretion of the Lula government. According to the special adviser to the Presidency, the holding of elections in the country next year was also discussed. “We talk about all subjects. I wasn’t questioning him (Maduro), but he knew I was going to meet with the opposition and didn’t create any difficulties for that”, stated Amorim.
Relations
During the government of President Jair Bolsonaro, Brazil supported the international strategy of maximum pressure (when countries begin to adopt sanctions, for example, or other unilateral measures) against the Chavista regime, which included the recognition of Juan Guaidó, an opponent, as president Venezuela interim. Even before taking office, Lula had already indicated that he would adopt a policy different from that of Bolsonaro and that he would open a channel for dialogue with Maduro.
“It was a visit to make contact, to show that we are interested in having an important relationship, to contribute to an economic recovery, as far as we are able; talk about political stability and also about democracy. It is a process that is already underway, dialogue,” said Amorim, Minister of Foreign Affairs during Lula’s first two terms, from 2003 to 2010.
“No one ignores that there are problems, but there is a dialogue today like there was not before. Everyone is focused on the election and not on the overthrow of the government, and there is an interest in facilitating investments in Venezuela. People are walking, circulating and looking for a solution”, stated Lula’s special advisor.
In a note sent to Estadãothe BNDES states that it will look for Amorim to “understand how the conversations took place” with Maduro.
“The current BNDES board has not yet been formally informed about Venezuela’s readiness to resume payments. However, it will seek to work together with the federal government to restore the flow of financing payments”, says the bank, in the note.
Also according to the bank, “the BNDES does not lend money to other countries or finance works or projects in other countries, but only the export of goods and services produced in Brazil, with the objective of increasing the competitiveness of Brazilian companies, creating jobs and income in the country, and the inflow of foreign exchange (more information on this page)”.
Foreign policy
This week, the positioning of Brazilian foreign policy on authoritarian regimes in Latin America had national and international repercussions, after Brazil decided not to endorse a declaration at the UN Human Rights Council condemning the regime of dictator Daniel Ortega, in Nicaragua.
According to Amorim, Brazil will not join a group that defends sanctions. “We are taking a clear position, but the objective is not just to show the finger and criticize. Criticizing if necessary, expressing concern, but if possible seeking to help,” he said. He said that Brazil recognizes the deteriorating situation in Nicaragua and the crimes against humanity that are taking place.
BNDES financed plant and subway in the country
The biggest project financed by the BNDES in Venezuela is the construction of the Usina Siderúrgica Nacional, carried out by the contractor Andrade Gutierrez. The work had a loan of US$ 865 million contracted in 2010. In the midst of the investigations of Operation Lava Jato, the financing was suspended. Another outstanding project is the construction of Line 2 of the Los Teques Metro, under the responsibility of Odebrecht, which received a loan of US$ 862 million. This financing was also suspended.
There are suspicions of corruption hovering over the works, involving the hiring of construction companies by the Venezuelan government. Since the operations began to be questioned, the BNDES has been saying that it followed all the rules for granting financing for foreign trade. As the debts were guaranteed by the FGE, a National Treasury fund, the bank followed the financial conditions defined by the federal government for this type of operation.
In total, the BNDES disbursed US$ 10.5 billion in financing for works abroad, in 15 countries, since the end of the 1990s. and already including compensation for defaults. Angola was the country that received the most loans – and has already paid everything back. Argentina was the second country that received the most – and still has a final installment of US$ 29 million to pay. Contractor with the most contracts abroad, Odebrecht won US$ 7.984 billion, 76% of the total.
The information is from the newspaper The State of S. Paulo.
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