Crisis in Caracas: Venezuela's Debt Dilemma Unfolds

The ousting of President Nicolas Maduro has brought Venezuela's longstanding debt crisis to the forefront. International sanctions and economic turmoil led to a default in 2017. With a current debt estimated between $150-$170 billion, restructuring appears complex, impacted by political and legal complexities and restrained by U.S. sanctions.

The removal of President Nicolas Maduro has cast a spotlight on Venezuela's unresolved debt crisis, marked as one of the largest sovereign defaults globally. The country's financial woes began after missing payments on international bonds in 2017, compounded by years of economic challenges and harsh U.S. sanctions.

Venezuela owes an estimated $60 billion in defaulted bonds, with total external debt approaching $150-$170 billion due to additional obligations. This debt struggle remains intricate largely because of legal suits and the massive pool of creditors including international bondholders and bilateral creditors like China and Russia.

While there's some optimism with speculators betting on political changes, the path to restructuring is littered with obstacles. U.S. sanctions hinder progress, and uncertainty looms over the potential effects and timeline of such efforts. Analysts suggest a significant debt haircut is essential to regain stability.

(With inputs from agencies.)