Increasing pressure on Maduro, the US handed control of Venezuela’s bank accounts in the US to the opposition leader

The United States said it has handed control of Venezuela’s bank accounts in the US to Juan Guaido, the opposition leader whom Washington has recognised as interim president.

Secretary of State Mike Pompeo signed off on the order last week for Guaido to control holdings in the Federal Reserve Bank of New York and federally insured banks, the State Department said.

“This certification will help Venezuela’s legitimate government safeguard those assets for the benefit of the Venezuelan people,” State Department spokesman Robert Palladino said in a statement.

The US has been pressing other countries to part ways with President Nicolas Maduro and recognise Guaido as Venezuela’s interim president. 

On Monday, US President Donald Trump’s administration also announced sanctions against Venezuela’s state oil company PDVSA.

The move is expected to block $7bn in assets and result in $11bn of lost export revenue over the next year. 

“These [sanctions] would greatly impact the cash flow of state-owned oil company PDVSA and the country in general,” Carlos Eduardo Pina, a Venezuelan political scientist,  told Al Jazeera.

“A lower inflow of foreign currency to Venezuela’s economy would limit the supply of dollars and thus the exchange rate would increase considerably. 

“An increase in the exchange rates traduces into higher inflation, leading to huge discomfort among the population that could end leading to further protests,” Pina added.  

Treasury Secretary Steven Mnuchin, speaking Tuesday to the Fox Business Network, said that more economic pressure could be coming.

“We will always look at additional sanctions to make sure we protect the assets of the country for the people of Venezuela,” he said, adding that the US wanted to ensure that medicine and other humanitarian goods can still go through.

In response to the US’s move, Maduro on Monday vowed to take action, calling the sanctions “criminal”, and accused Washington of robbing Venezuelans of oil riches that rightfully belonged to them.

‘External interference will complicate things’

The US, Brazil, Canada, Colombia, Argentina, Peru, Ecuador and Paraguay have officially acknowledged Guaido as the legitimate interim head of Venezuela, while countries including Russia and China back Maduro.

Inside Venezuela, Maduro holds the reins of power with the armed forces still loyal despite an opposition push to gain their support by proposing amnesty for anybody who supports Guaido’s transitional government.

Maduro has accused the US of leading an open coup to remove him from power and exploit Venezuela’s oil reserves, the largest in the world.

Guaido said in an interview with CNN on Monday that Venezuela’s opposition-controlled Congress had approved a measure asking foreign nations to ensure the country’s assets are not “looted” by Maduro.

Meanwhile, Russian Deputy Finance Minister Sergei Storchak told Russian state news agencies that “there will probably be problems” for Venezuela in paying its debts.

Storchak said Venezuela owes Russia $3bn, with repayments twice a year of around $100m, the next one due in March.

China has also loaned Venezuela more than $50bn through oil-for-loan agreements over the past decade, securing energy supplies for its fast-growing economy.

On Tuesday, China’s foreign ministry criticised the US sanctions. 

“Experience has proven that external interference or sanctions will only complicate the situation and will not help solve practical problems,” foreign ministry spokesman Geng Shuang said at a regular media briefing on Tuesday.

The Big Picture

The Battle for Venezuela

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