MercoPress. South Atlantic News Agency

Venezuela will abandon the IMF and WB “at the right moment”

Venezuela will abandon the International Monetary Fund and the World Bank “at the right moment” said President Hugo Chavez on Wednesday.

"There's a technical commission working on the issue. I've made an announcement which somehow can be described as a political statement on the matter", said Chavez in an interview with the foreign press in Caracas. "The Ministry of Finance and Planning are working on an assessment and according to the first estimates we've concluded to continue working in that direction, but we don't have to do it immediately because it could affect the national situation, the Venezuelan economy and the Venezuelan debt", he added. At the beginning of April, Chavez announced that Venezuela would be abandoning the IMF and WB because they are "the tools of the empire" and "serve the interests of the North". According to contract clauses of the Venezuelan debt, if the country adopts such a decision (regarding the IMF and WB), some investors are entitled to the 100% face value advance reimbursement of the sovereign debt, since there's no multilateral organization to endorse those bonds. Of the 22 billion US dollars in Venezuelan bonds, almost 25% are in a default "pre situation", which is equivalent to 4.5 billion US dollars according to the risk rating agency Fitch office in Caracas. In the last few months Venezuela has issued bonds with the purpose of draining liquidity from the domestic money market, to promote savings and to help contain inflation. The issues include 2.5 billion US dollars in South Bonds (shared with Argentina) and 7.5 billion from the country's government owned oil company PDVSA. Venezuela is South America's main oil producer and exporter. Finance Minister Rodrigo Cabezas recently announced a new South Bond II issue for the second half of this year in the range of half to a billion US dollars. "Actually we have nothing to do with the IMF or the WB", underlined Chavez recalling that Venezuela recently cancelled all its debts with both multilateral organizations.