Description: Following the lifting of sanctions on several Venezuelan banks, the International Monetary Fund (IMF) and the World Bank announced that they would restore cooperation with the current Venezuelan government. The resumption of cooperation enables the Venezuelan government to access loans and enhance cooperation with international state and non – state actors and investors. It will also enable the country to access billions in frozen funds in international banks which could rescucitate its economy and relatively stabilize domestic financial flows. Members of the European External Action Service also held high – level talks with Venezuela’s government, primarily the speaker of parliament and a working group, where they also discussed extending cooperation in light of IMF’s and the World Bank’s restoration of cooperative ties.
Impact: IMF and the World Bank as the leading international financial organizations would likely further incentivize foreign investors to approach the Venezuelan market. The country’s outstanding foreign debt would most likely be tackled initially as Venezuela has been excluded from international financial organizations for more than 20 years. Recent stabilization on the political field likely indicates that current president Delcy Rodriguez has successfully reshuffled and restructured the current administration, however, economic recovery would likely be a lengthy process. State ownership in larger oil and mining companies would likely decrease over the long – term as private investors would aim at insulating themselves from ties with any future government. IMF’s and the World Bank’s recognition of Venezuela as a legitimate partner would also likely facilitate a comprehensive transition towards economic stabilization. Challenges such as control over illegal mining operations by domestic colectivos and militias remain, however, the current Venezuelan administration looks poised to become a stable international partner, especially on the global energy market.