Venezuela leadership issue still blocking IMF, World Bank aid

By Rodrigo Campos and David Lawder

WASHINGTON, April 11 () - International Monetary Fund and World Bank shareholders are still undecided on whether to recognize Venezuelan opposition chief Juan Guaido as the country's leader, the institutions said on Thursday.

The heads of the IMF and World Bank both said they are preparing to move quickly to help ease Venezuela's worsening humanitarian crisis, but the leadership question is standing in the way.

"It is in progress as we speak, from quite a few members. As soon as that happens, we will follow up."

More than 50 countries, including the United States and Venezuela's largest neighbors, have recognized Guaido, the head of the National Assembly, as the South American nation's leader. Russia and others dismiss that claim and recognize Nicolas Maduro, long-time president and heir to the late Hugo Chavez, as the legitimate head of state.

A simple majority of member votes could decide who the official delegate from a country to the IMF is and a call for such a vote would have to come from the IMF's leadership. So far, there have been no announcements in that regard.

Based on the countries which have publicly supported Guaido or Maduro as the legitimate leader of Venezuela, and their voting weighting inside the World Bank and the IMF, Guaido's representative could get more than half the votes according to a tally.

Public support from a government for Guaido does not necessarily mean that country would vote for his representative at the IMF, and even a slight majority would not necessarily move the traditionally consensus-driven bank to act.

The United States has by far the highest percentage of voting power both at the World Bank and the IMF for any single member, with nearly 16% of the vote at both institutions.

The Inter-American Development Bank last month recognized Guaido appointee Ricardo Hausmann as Venezuela's representative.


David Malpass, who started as the World Bank's new head on Tuesday, told a press conference that Venezuela is "something of deep concern" to the World Bank.

"The World Bank will be deeply involved and we are preparing for that, but the situation is still troublesome on the ground," Malpass said.

Venezuela is mired in a deep economic crisis marked by widespread food and medicine shortages and crippling inflation. An estimated 3 million Venezuelans have left the oil-rich OPEC country since 2015.

The United States is trying to isolate Maduro's government on various fronts, including through the use of strict economic sanctions that have squeezed Venezuela's finances.

On Wednesday, U.S. Vice President Mike Pence called on the United Nations to revoke the U.N. credentials of Maduro's government and recognize Guaido as Venezuela's leader.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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