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Montevideo, December 17th 2017 - 11:51 UTC

Chilean central bank revokes reciprocal credit line with Venezuela

Friday, September 22nd 2017 - 09:25 UTC
Full article 6 comments
 In a statement, Chile’s central bank said it had notified Venezuela’s central bank and that the line would be cancelled within 10 days. In a statement, Chile’s central bank said it had notified Venezuela’s central bank and that the line would be cancelled within 10 days.

Chile’s central bank said it had revoked a reciprocal credit line with its Venezuelan counterpart, citing what it called Venezuela’s failure to pay back its debts. In a statement, Chile’s central bank said it had notified Venezuela’s central bank and that the line would be cancelled within 10 days.

 The monetary authority said it has been taking steps to mitigate its exposure to Venezuela since 2014 and was currently owed US$2.1 million by that country’s central bank.

“The progressive deterioration of Venezuela’s financial indicators and the (Venezuela central bank‘s) behavior in prior years under this arrangement had already motivated us to adapt measures to safeguard the Central Bank of Chile’s wealth,” the monetary authority said in a statement.

The Venezuelan central bank had made “intensive use” of the credit line in recent years, Chile’s central bank said.

Venezuela’s economy is undergoing a deep recession and its currency reserves are at their lowest levels in years as the OPEC country grapples with low oil prices and a flailing socialist model.

Nevertheless the Venezuelan administration of president Nicolas Maduro has said it will make all pending debt payments despite a set of difficulties that have resulted from financial sanctions imposed by the United States.

 

Categories: Economy, Politics, Venezuela, Chile.
Tags: Chile, Venezuela.

Top Comments

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  • Marti Llazo

    The same Chile that continues to support North Korea.

    What's the real difference? North Korea keeps paying the chilenos. Venezuela doesn't.

    Sep 22nd, 2017 - 02:51 pm +1
  • Marti Llazo

    Chile sells copper to North Korea that is used in their nuclear programme, along with food, wine (of course) and other food products. The Bachelet government refused to even consider joining in the sanctions being recommended, following the recent North Korean weapon launches (Bachelet, we recall, was trained in East Germany and retains sympathies with the former Eastern Bloc). Of all Latin American countries, Chile purchases the most from North Korea,and pays in dollars which the North Korean government greatly needs. Chile buys specialty steel and iron products from North Korea, among other materials, and the trade balance is significantly in favour of North Korea. You can obtain further details from MINREL (Ministerio de Relaciones Exteriores).

    Sep 23rd, 2017 - 03:35 am +1
  • Chicureo

    Thank you Marti for your response. As a Chilean I feel woefully ignorant and a bit ashamed by my government's political decision to trade with NK. Maybe now that will end...

    Sep 24th, 2017 - 06:49 pm +1
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