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IMF: No transactions with Venezuela while leadership in doubt

AFP  |  Washington 

The will not have any contact with Venezuela, nor allow the country to access its reserves held by the institution, until the international community recognises a government in Caracas, an IMF has said.

The country's leadership has been in question since late January when challenged as the country's acute economic crisis worsened.

"Any IMF engagement with Venezuela, including responding to potential financial transaction requests, is predicated on the issue of government recognition being clarified," an IMF told AFP on Wednesday.

"We are guided by our membership on that issue, and at this point, this determination has not been made."

The is among some 50 countries that recognize Guaido, the opposition who declared himself in late January in a bid to replace Maduro. Guaido has branded Maduro's rule illegitimate because of what Guaido calls fraudulent elections last year in which Maduro won another term in office.

Maduro, who is backed by and China, is under increasing pressure as the economy implodes and the exodus of Venezuelans continues amid a worsening humanitarian crisis.

The IMF has previously said it is awaiting a decision by its members on recognition of a government in Caracas, which would take a majority of the voting shares on the fund's board.

All of the 189 members of the global crisis lender are required to keep a minimum level of foreign currency reserves on deposit at the IMF, but because of the limbo in neither Maduro nor Guaido could have access to those funds.

Nor would either be able to enter negotiations with the IMF for an aid program.

The has sanctioned a broad array of officials, military officers and institutions, blocking them from the financial system and freezing assets held in US banks, including those of Venezuela-owned company

Britain also has recognised Guaido, and the holds about 31 tons of Venezuelan gold reserves worth USD 1.3 billion, which Maduro has been trying for several months to repatriate.

Earlier Wednesday, US asked the to recognise Guaido as the legitimate leader of Venezuela, telling the Security Council, "must go.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Thu, April 11 2019. 01:50 IST