Venezuelan Central Bank data published late on Friday had unfurled that the US sanction-hit LATAM economy’s international reserves had soared to a five-year peak of roughly $11.3 billon, however, the Bank did not disclose the funds’ sources.
In point of fact, latest data from the Venezuelan Central Bank, which has long been languishing amid an excruciating lack in international reserves, largely due to stiffer US sanctions, and had been failing to proffer handouts for the economy to import essential goods such as foods and medicines, came against the backdrop of a Wednesday data that had shown the Country’s FX reserves had soared by $5.1 billion year to-date.
With the Central Bank of Venezuela declining to comment on the issue, it remained foggy on how the funds had emerged out of the blues.
Venezuelan International Reserves hit five-year peak
Looking inwards, the International Monetary Fund’s website had unveiled that the LATAM economy had received an allocation of 3.5 billion in August in Special Drawing Rights (SDR), a unit of exchange for IMF denominated by US Dollar, euro, yen, pound alongside yuan, which could be worth as much as $5.08 billion as of August 31 international exchange rates, nonetheless, the IMF also had added that the Government of military-backed socialist President Nicolas Maduro that the US alongside its western allies did not recognize and had been met with stiffer sanctions aimed at weaning the nation from receiving vital supplies while blocking payments for oil sales, would not have access into the fund due to the Government’s legitimacy, stoking further doubts over sources of latest FX reserve raise.
Meanwhile, an IMF spokesperson said following the announcement, “There remains lack of clarity in the international community regarding the recognition of the de facto government, as a consequence of which the country cannot access SDRs or other IMF resources”.
However, media investigations had detailed on prior occasions that the resource-rich country was selling off its medium- to heavy-grade crude oil through offshore (vessel-to-vessel) handovers to other parties which were not subject to sanctions, a policy widely adopted by the nations having been hit with US sanctions such as Iran.