US issues license allowing transactions with some Venezuelan banks

WASHINGTON, April 14 (Reuters) – The Trump administration issued two new Venezuela-related general licenses on Tuesday, including one that allows financial transactions involving certain Venezuelan banks and Venezuelan government individuals, according to documents posted to the U.S. Treasury Department’s website.

The documents published by the Treasury Department said financial transactions will be permitted for Venezuela’s central bank, which was sanctioned in April 2019, as well as for the state-owned banks Venezuela, Tesoro, and Digital de los Trabajadores.

For nearly a decade, the country’s central bank and its state-owned banks have faced restrictions on conducting financial transactions abroad due to a lack of correspondent banks to facilitate them, a situation that worsened after the U.S. imposed sanctions on Venezuela in 2019.

The easing of sanctions on the central bank and state-owned banks comes as a new dollar supply system is being implemented, driven by increased crude oil sales following the U.S. seizure of President Nicolas Maduro’s assets in January. 

Last month, Maduro appeared at a U.S. court to address drug trafficking charges against both him and his wife, Cilia Flores. The pair pleaded not guilty to charges including narcoterrorism conspiracy and are jailed in Brooklyn pending trial.

Washington is seeking to stabilize the Venezuelan economy and open it up to U.S. investment.

In Venezuela, foreign currency is auctioned through local banks, with allocations determined by the central bank and foreign corresponding banks, sources told Reuters in March. They added that under the auction scheme, some small and medium-sized companies are omitted in favor of larger corporations.

The U.S. Treasury Department also issued a license authorizing commercial contract negotiations. The execution of such contracts would have to be “subject to separate authorization from the Office of Foreign Assets Control,” the Treasury document said.

The Treasury also lifted sanctions against Venezuela’s former solicitor general, Reinaldo Munoz, who was recently replaced by Arianny Seijo.

(Reporting by Daphne Psaledakis and Ismail Shakil; Editing by David Ljunggren, Daina Beth Solomon and Bill Berkrot)