President Donald Trump signed Friday an executive order imposing a fresh round of sanctions on the regime of Venezuelan leader Nicolas Maduro.
The measures are aimed at Venezuela’s debt-ridden government and state-owned oil company, Petróleos de Venezuela (PDVSA). They will restrict Venezuela’s access to U.S. financial markets so the Maduro regime can no longer “underwrite its repression” of opposition groups, a senior administration official said.
Under the new sanctions, American financial institutions and individuals are prohibited from trading new debt and equity issued by the Maduro government, or PDVSA. The measures also block dealings in certain existing bonds owned by the Venezuelan public sector, as well as dividend payments to the government of Venezuela.
“These measures are carefully calibrated to deny the Maduro dictatorship a critical source of financing to maintain its illegitimate rule, protect the United States financial system from complicity in Venezuela’s corruption and in the impoverishment of the Venezuelan people, and allow for humanitarian assistance,” the White House said in a statement announcing the sanctions.
The Trump administration has already targeted dozens of top Venezuelan officials — including Maduro himself — with individual sanctions, freezing their assets subject to U.S. control. Administration officials had suggested this week that additional punitive measures were under consideration to bring what Vice President Mike Pence said would be “the full measure of American economic and diplomatic power” to bear on the Maduro regime.
Friday’s sanctions apply additional pressure on the Maduro regime by constricting its ability to issue new debt and stave off default on its outstanding obligations. The Trump administration says the measures are intended to force Maduro hold free and fair elections ease repression of opposition groups.
“The U.S government will not allow the Maduro regime and few corrupt individuals to use the U.S financial system to divert Venezuela’s scarce resources away from the real needs of the Venezuelan people and into their own pockets,” a senior administration official said.
The new sanctions stopped short of cutting off U.S. transactions with Venezuela’s critical energy sector, which accounts for more than half of the country’s GDP and over 90% of total exports. Venezuela will still be able to export oil to the U.S., where it refines and sells petroleum products under the Houston-based, PDVSA-owned Citgo brand.
Trades on existing Venezuelan government debt will be allowed to continue in secondary bond markets, according to administration officials.
Friday’s sanctions are likely to worsen tensions between Washington and Caracas, which were already at their “worst moment,” Maduro said Tuesday.
Last month, Trump called Maduro a “dictator” and blasted the Venezuelan leader for his ongoing crackdown on anti-regime demonstrators. Maduro responded by ginning up anti-American fervor among his socialist party supporters, accusing the U.S. of instigating violent street protests across Venezuela and conspiring with right-wing elements to steal the country’s oil wealth.
Civil unrest continues to convulse Venezuela as Maduro has moved to consolidate power in the national legislature. The country is suffering severe shortages of food and medical supplies, made worse by triple-digit inflation rates that have rendered the local currency worthless.
More than 120 Venezuelans have died in clashes between government security forces and opposition groups since mass demonstrations began in late April.
This report, by Will Racke, was cross posted by arrangement with the Daily Caller News Foundation.