Wed, Aug 07, 2019 - Page 10 News List

Trump freezes Venezuela’s US assets

ESCALATION:The ban bars US firms and individuals from doing business with Caracas and puts the US assets of its key supporters such as China, Russia, Cuba and Iran at risk


US President Donald Trump’s administration on Monday froze all Venezuelan government assets in a dramatic escalation of tensions with Venezuelan President Nicolas Maduro that places his socialist administration alongside a short list of adversaries from Cuba, North Korea, Syria and Iran that have been targeted by such aggressive US actions.

The ban blocking US companies and individuals from doing business with Maduro’s government and its top supporters, which takes effect immediately, is the first of its kind in the western hemisphere in over three decades, following an asset freeze against general Manuel Noriega’s government in Panama and a trade embargo on the Sandinista leadership in Nicaragua in the 1980s.

While the order falls short of an outright trade embargo — notably, it spares Venezuela’s still sizable private sector — it represents the most sweeping US action to remove Maduro since the Trump administration recognized Venezuelan National Assembly President and opposition leader Juan Guaido as the nation’s rightful leader in January.

Critically, it also exposes foreign entities doing business with the Maduro government to US retaliation.

“The apparent goal is to give the US the ability to apply the law beyond its borders to allies of Maduro like China, Russia, Cuba, Iran and Turkey,” said Russ Dallen, the Miami-based head of Caracas Capital Markets brokerage. “Should those foreign entities continue doing business with Maduro they can have their US assets seized.”

The executive order signed by Trump justified the move by citing Maduro’s “continued usurpation of power” and human rights abuses by security forces loyal to him.

US National Security Adviser John Bolton hinted earlier on Monday that far-reaching US action was close at hand.

Speaking to reporters on the eve of an international conference in Peru to show support for Guaido, he said that the US was readying measures “that will show the determination that the United States has to get a peaceful transfer of power.”

The US’s previous sanctions targeting the South American nation’s oil industry, the source of almost all of its export earnings, have already accelerated a crash in oil production that started with Maduro’s election in 2013 following the death of then-Venezuelan president Hugo Chavez.

More than 100 officials and government insiders have also had their US assets frozen and blocked from doing business with Americans. As part of the executive order, Americans or US companies that do business with such individuals face penalties. The same Maduro supporters will also be banned from entering the US.

Exceptions will be allowed for the delivery of food, medicine and clothing. Transactions with Venezuela’s still sizable private sector do not appear to be affected either.

It is unclear how the actions will affect US oil giant Chevron, which last month received a three-month exemption from the US Department of the Treasury to allow it to continue drilling for oil with state-run oil monopoly PDVSA.

The Maduro government has yet to respond, but Guaido celebrated the US action, saying it would protect Houston-based oil company CITGO — Venezuela’s most valuable overseas asset — from attempts by Maduro to mortgage its assets.

“Any individual, company, institution or nation that tries to do business with the regime will be seen by the international justice system as collaborating with and sustaining a dictatorship,” Guaido said in a series of late-night Tweets. “They will be subject to sanctions and considered an accomplice to crimes.”

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