Citgo should be run by an independent trust, Venezuela opposition figure says

4 minute read

A Citgo gas station is pictured in Kearny, New Jersey September 24, 2014.REUTERS/Eduardo Munoz/File Photo

CARACAS, July 29 (Reuters) - Venezuela's opposition should hand over U.S. refiner Citgo and other overseas assets that it controls to an independent trust until President Nicolas Maduro leaves power, senior opposition politician Julio Borges said in an interview this week.

Washington in 2019 recognized opposition-held National Assembly speaker Juan Guaido as Venezuela's president and allowed the Assembly to authorize boards of directors to Citgo and Colombia-based petrochemicals company Monomeros, which is also owned by Venezuela.

Borges, who is based in Bogota and serves as Guaido's chief diplomatic representative, is now proposing that the opposition put a multilateral agency in charge of choosing management and conducting oversight of the companies, arguing that the current arrangement has become a "distraction."

"Our task is not to manage companies. Our task is to get Nicolas Maduro out of power," Borges told Reuters.

The proposal marks a new rift within the opposition, which is struggling to maintain a stalled effort to oust Maduro two years after the United States launched a broad sanctions program that was meant to usher in a political transition in Venezuela.

Washington is also protecting Citgo from possible seizures by creditors seeking to collect on unpaid debts from state oil company PDVSA and Venezuela.

"We are grateful for the protection of the assets, but we cannot depend on that - we must explore new models that give that protection more stability," Borges said.

Opponents label Maduro a dictator who has overseen an economic collapse, violated human rights and rigged his 2018 re-election. Maduro blames the economic crisis on U.S. sanctions and opposition sabotage, and has accused the opposition of "stealing" Citgo and Monomeros.

Borges said he and his party - Justice First, one of four that make up the main opposition coalition - had presented the proposal to Guaido, but had not yet received a response. He mentioned the Washington-based Inter-American Development Bank as an institution that could possibly oversee the trust.

A Guaido spokesman did not respond to a request for comment.

Guaido and his Popular Will party have described the interim government's management of Citgo and Monomeros as transparent and responsible, drawing a contrast with Maduro's governance they say was marked by graft.

Venezuela's information ministry did not respond to a request for comment.

When Guaido assumed control of the companies in 2019, many believed a change of government was imminent. But Maduro has remained in power, backed by the South American country's military, as well as allies like China, Russia and Cuba.

Putting Citgo under the control of a trust would prevent any dividends from immediately reaching its owner, an ad-hoc board of directors for PDVSA named by the opposition. But the company has not paid dividends in years, in part due to covenants on loans barring it from disbursing profits until it meets certain financial conditions.

Citgo also posted a $667 million loss in 2020, due to slack demand for fuel and higher costs. read more

Reporting by Mayela Armas in Caracas and Luc Cohen in New York Editing by Marguerita Choy

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