The Trump Administration issued additional sanctions against the Venezuelan government after elections that U.S. officials said were "neither free nor fair" and accused President Nicolas Maduro's government of worsening the humanitarian and public health crisis facing the country.
The executive order restricts U.S. citizens and those within the U.S. from purchasing any debt owed to the Venezuelan government, including accounts receivable.
The order "restricts the regime's ability to liquidate state assets at fire sale prices at the expense of the Venezuelan people," according to a senior administration official.
"It denies corrupt Venezuelan officials the ability to improperly value and sell off public assets in return for kickbacks," the official said during a briefing with reporters. "Specifically, today's new executive order prohibits all transactions related to the purchase of any debt owed to the government of Venezuela ... This includes, by the way, debt associated with PDVSA, the state-owned oil company."
Officials would not go into specifics on the types of assets and debt that Maduro's government has been selling. The executive order does not prohibit U.S. companies from selling oil products to Venezuela, nor does it prohibit the importation of products into the United States.
When asked about China's ownership of a significant portion of Venezuelan debt and its subsequent influence in its politics, one official said the U.S. has emphasized to both China and Russia that the only entity lawfully authorized to issue new debt in Venezuela is its national assembly.
"We have had fairly pointed discussions with the People's Republic of China on not throwing good money after bad," the official said. "This is not a power that the constituent assembly, which is itself a sham structure created by yet another fraudulent election, or the dictatorship itself, this is not something they are empowered to authorize, and we've encouraged China to take note of that fact. We've had a similar discussion with Russia, who seems determined to play a spoiler in every way possible, on this and other matters."
Maduro won the balloting on May 20 after a campaign that was boycotted by Venezuela's mainstream opposition.