S&P Warns Venezuela Likely to Default on Debt within Six Months

By: Sabrina Martín - @SabrinaMartinR - Jul 13, 2017, 10:40 am
default - venezuela
Venezuela’s rating changed from CCC to CCC-, after the aggravation of the political and financial crisis that faces the South American country. (Hot FM)

EspañolThe financial agency Standard & Poor’s has downgraded Venezuela’s debt rating, warning that it is at risk of defaulting within the next six months.

The country’s rating changed from CCC to CCC- following a worsening political and financial crisis. The agency explained that the lowered score is due to the deterioration of the economy and government’s assets and an increased political tension caused by reckless and malicious leadership under President Nicolás Maduro.

Standard & Poor’s officials said they are certain Venezuela will default unless they significantly and unexpectedly improve those conditions. They said they also fear that the country’s economy, which has relied for years on low oil prices, can’t be financed on the international market, making the country incapable of paying its debts.

S&P also said that without new and consistent foreign financing, the government will have difficulty repaying the country’s debt. Currently, officials predict an increase of  US $2.8 billion in the second half of 2017, and about $7 billion in 2018.

The rating agency forecasted a six-percent decrease in Gross Domestic Product (GDP) this year.

S&P warned that the weakening of institutions and the growing discontent among the population could further reduce Venezuela’s ability to cope with urgent economic and social problems.

In January 2017, the rating agency Fitch Ratings also warned that state oil company PDVSA would be on the brink of defaulting as well.

Source: El Estímulo

Sabrina Martín Sabrina Martín

Sabrina Martín is a Venezuelan journalist, commentator, and editor based in Valencia with experience in corporate communication. Follow @SabrinaMartinR.

Former Brazil President Lula Sentenced to Nine and a Half Years in Prison for Corruption

By: Sabrina Martín - @SabrinaMartinR - Jul 13, 2017, 9:40 am

EspañolFormer President of Brazil Luiz Inacio Lula da Silva has been sentenced to nine and a half years in prison for corruption and money laundering. The ruling is only the first of five regarding Lula's corruption scandal, but the former President still remains free while officials wait to hear whether he will appeal. Judge Sergio Moro made the initial ruling this Wednesday, July 12 after hearing all the evidence of the Lava Jato (or "Car Wash") case investigation. Lula da Silva accepted the bribes from construction company OAS, which provided him with an apartment, in addition to paying for the storage of Lula's assets in a company called Granero na Grande — totaling US $1.1 million. "President Lula is innocent," said one representative of Lula da Silva's legal team. "For over three years, Lula has been subject to a politically motivated investigation." googletag.cmd.push(function() { googletag.display('div-gpt-ad-1459522593195-0'); }); This is just one of multiple ongoing corruption scandals currently going on in Brazil. Lula's successor, former President Dlima Rousseff, was impeached last year following the discovery of her involvement in the Petrobas scandal. Her successor, the current President of Brazil Michel Temer, is facing his own slew of corruption charges after a leaked audio revealed his involvement in a bribery scandal. Read More: Reporters in Venezuela’s Protests Face Brutal Repression from Dictatorship Read More: Videotapes Implicating Ecuador Officials in Odebrecht Corruption Surface in Brazil’s Probe None of them, though, were as popular as Lula, who former US President Barack Obama once deemed "the most popular man on earth." For this and other reasons, Lula and his legal team continue to maintain that the entire case is a political attack. “You do not have proof that this apartment belongs to Lula,” National President of the Worker's Party, Senator Gleisi Hoffmann, said. “If you want to take Lula out of politics, be decent, be brave, nominate a candidate and fight at the polls." Protests broke out in response to the ruling last night, both for and against it. The police in Sao Paulo created a blockade to prevent the two sides from clashing with one another. Sources: La Patilla; El País;

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