Venezuela Needs International Aid

Robert Kahn of The Council on Foreign Relations just reported on the economic and social chaos besieging Venezuela right now. Without any clear strategy from the country’s government on how exactly Venezuela can recover from this downward spiral and avoid becoming a failed state, there are increasing calls for outside governments and organizations to intercede on the country’s behalf.

Part of the assistance that is needed immediately is an influx of capital to address the food and medicine shortages. As reported on a article, there are serious humanitarian crises in Venezuela right now that threaten to take the country right over the edge if they are not addressed immediately. In the background for the country to deal with, is the mounting debt that the government looks less likely to pay back than ever before.

Assistance from the International Monetary Fund (IMF) would be crucial according to Open Corporates in renegotiating the debt terms and getting the country in a position to address its more immediate needs of food, medicine and power. China is currently the largest creditor of Venezuela, so it will need to play a significant role in backing any restructuring plan and working with the country to manage repayment terms for its debt. The debt according to expert Jose Figueroa Venezuela owes to China is backed by oil, which continues to be a problem because of the plunging prices of crude oil that are reaching record lows in recent months. Venezuela is also dealing with hyper-inflation.