May 26, 2016 / 9:31 PM / 3 years ago

Venezuelan opposition warns foreign contracts need assembly's OK

Henry Ramos Allup, President of the National Assembly and deputy of the Venezuelan coalition of opposition parties (MUD), attends a session of the National Assembly in Caracas, Venezuela, May 17, 2016. REUTERS/Marco Bello

CARACAS (Reuters) - Venezuela’s opposition-led National Assembly on Thursday warned that contracts signed between the leftist government and foreign companies without lawmakers’ approval would be null.

President Nicolas Maduro this month declared an economic emergency and state of emergency that lets his administration sign contracts without Congress’ approval.

The assembly’s warning, though is not backed by legislation, is likely to create concern among foreign businesses that are seeking remain in the good graces of both the socialist government and opposition adversaries who control Congress.

“We’re going to tell all the embassies that the only valid contracts are those reviewed by the National Assembly,” its President Henry Ramos said. “Contracts that weren’t approved by the assembly will lack validity in this government as well as the following one.”

The opposition is seeking to remove the unpopular Maduro in a recall referendum this year, and insists that the president be replaced before his term ends in 2019. Maduro has dismissed this as impossible.

“We’re worried about the National Assembly’s decision,” said one executive at a foreign company in Venezuela, who requested anonymity to avoid any business impact.

But in recession-hit Venezuela, recouping outstanding debt is a bigger issue, the executive said. “We’re even more worried about lack of payments and those delays make it impossible to sign new contracts.”

Reporting by Eyanir Chinea and Alexandra Ulmer; Writing by Alexandra Ulmer; Editing by Richard Chang

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