(Bloomberg) -- Venezuela’s opposition would seek financial relief and a renegotiation of the nation’s mounting foreign debt if it was recognized as the rightful government, Juan Guaido, president of the National Assembly, said in an interview.
Since becoming head of the legislature this month, Guaido has been aggressively pushing the Venezuelan military and foreign governments to recognize him rather than the authoritarian leader Nicolas Maduro as the legitimate head of state. In a Jan. 11 statement, a group of Venezuelan bond investors said they’d recognize the National Assembly as "the only legitimately elected body" and wouldn’t negotiate with Maduro over unpaid debt.
The country’s sovereign bonds have gained in January amid speculation that declining support for Maduro may eventually bring about a regime change: debt prices have been range bound for most of last year. Guaido, 35, says that with new leadership, Venezuela could easily obtain financing and cut a deal with it creditors.
"Under the rule of law we will have clear elements to obtain new financing to boost the economy, stabilize the country and tend to the oil industry," Guaido said after Tuesday’s congressional session. “With a new government, the debt will not only be repaid, but we could refinance with the trust of a government that can pay.’’
Government opponents at home and abroad have have rallied behind fresh-faced Guaido as he makes the case that Venezuela’s constitution allows him to serve as acting president in the absence of a lawful government. He has revived the country’s opposition and is calling for countrywide demonstrations Wednesday against the Socialist autocracy.
Guaido said the demonstrations Wednesday, to mark the 61st anniversary of the birth of Venezuela’s democracy, will only be the beginning of a long fight to appeal to the international community and armed forces, who have long been the key power broker in Venezuela. “We’re talking about recovering constitutional order,” he said. “It’s not about twisting arms, it’s about extending our hands to the military.”
Referring to Maduro’s long-time international allies, who have offered financing as others turn their back on the autocratic government: “We want to reach out to Russia and China,’’ Guaido said.
Last week, the National Assembly declared Maduro illegitimate and passed measures asking foreign governments to freeze Venezuela’s liquid assets abroad and another offering blanket amnesty to any member of the armed forces who defects.
Guaido said sympathetic governments in Latin America have begun asking government’s outside the region to freeze Venezuela’s overseas assets to further isolate the ruling socialist party, which he called a “bad payer.’’
“Maduro doesn’t protect anyone, not investors, not even his own people,’’ he said.
Not only has Venezuela lost access to international capital markets, but creditors are closing in. Debt investors have begun to band together to demand more than $9 billion in overdue bond payments. The urgency increased after Houston-based ConocoPhillips and Canadian gold miner Crystallex International Corp. managed to wring $1 billion out of the government by threatening to lay claim to Venezuela’s assets abroad.
(Updates to add Guaido comment in sixth, ninth paragraphs.)
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