IMF and World Bank Restore Ties with Venezuela Under Interim Leadership

The International Monetary Fund (IMF) and the World Bank have announced the resumption of ties with Venezuela under the country's interim leader, Delcy Rodriguez. This move comes after a period of severed relations that began in 2019 due to international disputes over the legitimacy of Venezuela's leadership.

The IMF and World Bank had cut ties with Caracas in 2019 amid a split in the international community over whether to support Nicolas Maduro or Juan Guaido as the country's rightful leader following disputed presidential elections.

IMF Managing Director Kristalina Georgieva stated that the institution had resumed dealings with Venezuela under Rodriguez's administration, guided by the views of its members. This step is expected to ultimately benefit the Venezuelan people.

The World Bank followed suit, announcing that it would re-engage with Venezuela based on the outcome of the IMF's decision-making process. The bank had last made a loan to Caracas in 2005.

These announcements come several weeks after the United States President's administration lifted sanctions on Rodriguez, further conferring legitimacy on her leadership. Rodriguez welcomed the announcements, calling it a significant achievement for Venezuelan diplomacy.

Venezuela has one of the highest debt burdens in the world, with total external liabilities estimated at more than $150bn. The resumption of ties with the IMF and World Bank clears the way for Venezuela to request financial assistance if necessary to shore up its finances.

In 2020, the IMF had rejected Venezuela's request for an emergency loan of $5bn to help fund its response to the COVID-19 pandemic, citing the lack of international consensus on Maduro's legitimacy. Venezuela has been a member of the IMF and World Bank since 1946.