President Donald Trump signed a new executive order on Friday, imposing new financial sanctions on President Nicolas Maduro’s government in Venezuela.
“We will not stand by as Venezuela crumbles,” White House Press Secretary Sarah Sanders said in a statement Friday. “The President’s new action prohibits dealings in new debt and equity issued by the government of Venezuela and its state oil company. It also prohibits dealings in certain existing bonds owned by the Venezuelan public sector, as well as dividend payments to the government of Venezuela.”
The new sanctions prohibit banks from fostering new deals, including those involving debt and equity, with the government and the country’s state-run oil company, PDVSA.
Under the order, the Treasury Department intends to cut off financing to the “illegitimate” Maduro government. However, it will issue licenses allowing for a 30-day wind down period, financing for most commercial trade – including petroleum transactions involving Citgo – dealings in select existing Venezuelan debts and funding for humanitarian efforts. The purpose of these general licenses is to limit harm passed on to the Venezuelan and American people, the White House said.
The sanctions have been issued in response to Maduro’s decision to create a National Constituent Assembly with powers to rewrite the country’s constitution. Earlier this month, that body declared its powers superior to all other branches of government.
“The regime’s decision to create an illegitimate Constituent Assembly—and most recently to have that body usurp the powers of the democratically-elected National Assembly—represents a fundamental break in Venezuela’s legitimate constitutional order,” Sanders said.
The U.S. Treasury Department issued financial sanctions on individuals in the run-up to, and aftermath of, the election of the National Constituent Assembly, including against Maduro himself. President Trump promised swift economic action on behalf of the United States if Maduro followed through with that election, which was viewed by the administration as a blatant suppression of democracy and human rights.