Many months ago, we discussed the growing confrontation between Panama and Venezuela, which cumulated in a Panamanian threat to expose the Venezuelans who were hiding their money in Panama. As of May, the new Panamanian administration had decided not to follow through. So what happened then?
Short version: the Varela administration normalized relations right after his inauguration on June 1st. No more shouting.
But what about the unpaid Venezuelan debt that started the whole thing? Well, on October 29th, Panamanian trade minister Melitón Arrocha flew to Caracas to try to hammer out a settlement. That succeeded ... in the sense that on November 18th the two countries agreed to appoint two joint working groups to negotiate payment. The markets are not reassured: Copa Airlines (which is owed about $600 million) stock took a beating.
Meanwhile, Venezuela suffers. The number of international flights has been cut in half. And since the airlines now require payment in dollars, access to flights for Venezuelans has been reduced by even more. Meanwhile the collapse of trade with the Colon Free Zone has contributed to Venezuela’s shortages.
Given Venezuela’s woes, I would not expect payment in full.
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