As Venezuela sinks further into chaos the country has large bills that are coming due and it still has not paid other debts due several weeks ago.
On Friday, PDVSA the state-operated oil company paid $900 million to its bondholders, but another $350 million is still owed, from earlier in the month.
A number of experts following the economy in Venezuela see a default by the government as inevitable. The consequences if that were to happen would be very severe for a country of 30 million that is already close to running out of medicines and food.
Adding to the problems are more bills that will be due in less than a week. On November 2, next Friday, Venezuela owes over $1.1 billion. A three-day grace period to pay will be added if it is not paid on time before it is in default.
The Venezuela bonds are owned by a myriad of different investors from strategists on Wall Street to ordinary U.S. citizens with a 401K plan.
The Venezuelan government has drained all its savings to pay debt down. During 2011, the Venezuelan central bank was holding over $30 billion. In 2015, it had dropped to $20 billion and in 2017 down to $10 billion.
In contrast, neighbor Colombia is holding four times that amount or $46 billion in reserves.
Leaders from the Western Hemisphere were in Toronto late this week to condemn the authoritarian regime in Venezuela, which has allowed the vast resources of the country, it has more oil reserves than any other country, to be wasted.
Chrystia Freeland the Foreign Minister of Canada said that the Venezuela government was choosing the path of a dictatorship. The regime must face the consequences that go beyond just harsh condemnation and words.
Freeland did not specify what the consequences were that President Nicolas Maduro and his government could or should face. She did say she hopes that Cuba, a big ally of Venezuela, will join international condemnation of Venezuelan’s government.
Leaders in the West have not collectively placed sanctions on the South American country, but leaders say the option is available to them.
One of the biggest critics of Maduro was in Toronto as well: Former Attorney General Luisa Ortega. She fled Venezuela after the newly installed national legislature of Maduro banished her from the post she held.
The international group, known as the Lima Group, after its first meeting in August that was held in Lima, Peru, consists of the foreign minister from Canada along with several nations in South America including Argentina, Brazil, Colombia and Mexico.