Restructuring Venezuela’s Debt: Lessons from the Past and Implications for the Future

Journal article

Camilo Álvarez, Daniel A. Dias, Mark L. J. Wright
Journal of Investing, 2018

Cite

APA Click to copy
Álvarez, C., Dias, D. A., & Wright, M. L. J. (2018). Restructuring Venezuela’s Debt: Lessons from the Past and Implications for the Future. Journal of Investing.

Chicago/Turabian Click to copy
Álvarez, Camilo, Daniel A. Dias, and Mark L. J. Wright. “Restructuring Venezuela’s Debt: Lessons from the Past and Implications for the Future.” Journal of Investing (2018).

MLA Click to copy
Álvarez, Camilo, et al. “Restructuring Venezuela’s Debt: Lessons from the Past and Implications for the Future.” Journal of Investing, 2018.

BibTeX Click to copy

@article{camilo2018a,
  title = {Restructuring Venezuela’s Debt: Lessons from the Past and Implications for the Future},
  year = {2018},
  journal = {Journal of Investing},
  author = {Álvarez, Camilo and Dias, Daniel A. and Wright, Mark L. J.}
}

Abstract

Venezuela’s incipient sovereign debt restructuring is likely to be difficult for a number of legal and diplomatic reasons. This article discusses three additional economic issues that will influence the success of any restructuring operation. First, we show that Venezuela’s total debt liabilities are not transparent and present evidence suggesting that available measures may be misleading as an indicator of the total debt-servicing cost. Second, we calculate that there are significant gains to re-profiling Venezuela’s debt and note that it is feasible for these gains to be realized if official debts are restructured in accordance with past practices. Third, we review data on Venezuela’s oil wealth and argue that it could be either a help or a hindrance to a successful debt restructuring.