Venezuela Hit With Fresh New Economic Sanctions by Trump and United States Government
As per an all new circular issued by the US Government earlier today, Venezuelan banks will now be faced with an all-new set of sanctions that will make it even harder for their clients to “mobilize their assets for everyday purposes”.
This latest decision comes at a time when Venezuela is going through one of its most intense economic struggles— with inflation rates within the country currently at an all-time high (80,000%).
Additionally, it should also be mentioned that as part of the new sanctions, President Trump’s regime has added a number of highly established Venezuelan financial institutions to its list of SDN entities. For those of our readers who might not be aware, ‘Specially Designated Nationals’ (SDNs) are individuals or companies who are prohibited from dealing with any US-based firms due to various legal reasons.
Some of the banks included in this list are:
- The Banco de Venezuela
- Banco Bicentenario
- Banco Bandes Uruguay
- Banco Bicentenario Del Público, De La Clase Obrera, Mujer Comunas
- Banco De Desarrollo Económico Y Social De Venezuela
- Banco De Venezuela
- Banco Prodem
For those of our readers who might be interested, the US Treasury Department’s circular reads as follows:
“Today, the Department of the Treasury’s Office of Foreign Assets Control (OFAC) is designating Banco de Desarrollo Economico y Social de Venezuela (BANDES), and any entity in which BANDES owns, directly or indirectly, a 50 percent or greater interest, pursuant to Executive Order (E.O.) 13850 as amended by E.O. 13857, for operating in the financial sector of the Venezuelan economy, following a determination by Secretary of the Treasury Steven T. Mnuchin, in consultation with Secretary of State Michael Pompeo, that persons operating in Venezuela’s financial sector may be subject to sanctions pursuant to E.O. 13850 as amended by E.O. 13857 …”
More On The Matter
In regards to the aforementioned list of banking institutions that have been targeted by the new sanctions, it is worth pointing out that Banco de Venezuela is currently the largest bank in the country (from the standpoint of assets and clients maintained).
Similarly, Banco Bicentenario is the 6th largest financial institution within the nation in terms of total assets maintained. However, it also is the bank that is used by a majority of Venezuela’s public employees and retirees (who depend on a monthly pension from the gov. to meet their day-to-day needs).
Other Key Takeaways To Consider
- President Trump’s latest sanctions come after he had indicated in the past that he was trying to put more pressure on payment providers such as Visa and Mastercard to stop Venezuelans from using their services to facilitate their everyday transactions.
As per an all-new report published by Bloomberg, the United States government is not only looking to shake up the Maduro regime but also a number of other wealthy individuals within the country who have a lot of political clout— both locally and internationally.
The above-mentioned news story reads as follows:
“The aim is to squeeze Maduro and his allies in the military, as well as other connected, upper middle-class Venezuelans who have access to bank accounts and credit cards.”
Crypto To The Rescue
As soon as the US Government issued its latest economic clampdowns on Venezuela, SUDEBAN— the country’s primary financial regulatory body— took to the internet to announce that it too had initiated a series of dialogues with prominent economists so as to create new alternatives that could allow citizens to
“make payments in a traditional way without having to depend on the United States”.
El Superintendente, Cmdte. Antonio Morales conjuntamente con la Unidad Nacional de Inteligencia Financiera (UNIF) se reunieron este viernes #22Mar, con la Banca Pública, Banca Privada y Procesadoras de Pago para evaluar la creación y puesta en funcionamiento de Suiches Nacionales pic.twitter.com/wgtaFpIJdc
— SudebanInforma (@SudebanInforma) March 22, 2019
Following this announcement, the regulatory agency then went on to say that they were also looking at the possibility of officially implementing other tech-driven means to facilitate local payments such as:
- Electronic processors
- E-mail payments
La #Sudeban se encuentra evaluando la implementación de nuevos métodos de pago, a través del correo electrónico tipo ZELLE, botones digitales para tarjetas de crédito y débito, criptomonedas, billetera móvil y código QR. pic.twitter.com/GynJz3MVzX
— SudebanInforma (@SudebanInforma) March 22, 2019
While SUDEBAN’s proposals are still in their infancy, it remains to be seen whether the government body’s plan to use crypto is limited to just “the Petro” or other prominent alt-assets as well. Only time will tell what the future has in store for the people of Venezuela but for the time being, all we can do is hope and pray that the government is able to come up with a solution that is in the best interest of its citizens.