World Economy

Protesters Slam Goldman Sachs for Buying Venezuela Bonds

Protestors say Goldman Sachs’ purchase “supports the systematic violation of human rights”.Protestors say Goldman Sachs’ purchase “supports the systematic violation of human rights”.

Protesters vented their fury at Goldman Sachs over the US banking giant’s decision to buy $2.8 billion in Venezuelan government bonds, saying the move gives a lifeline to President Nicolas Maduro.

Waving Venezuelan flags, a small group of protesters outside the US banking giant’s headquarters in Manhattan shouted “Goldman Sachs Sucks!” AFP reported.

They also held signs saying “You give capitalism a bad name,” and “Goldman Sachs profit$ off the killing of Venezuelans by Maduro’$ regime.”

The bank last week paid about $865 million to purchase $2.8 billion in bonds issued in 2014 by Venezuela state oil company PDVSA—equivalent to about 31 cents on the dollar—but said it had no direct contact with the embattled government in Caracas.

“This deal is immoral. It is detrimental to the interests of the Venezuelan people, which have been repressed for months as it demands liberty and democracy,” said Eduardo Lugo, 23, a Venezuelan communications student who has been in New York for the last four years.

Lugo, a member of the opposition group SOS Venezuela protest organizer, told AFP the purchase would “support the systematic violation of human rights.”

Goldman Sachs said the bond purchase was based on expectations that things in Venezuela will get better. “We have invested in PDVSA bonds because, like many in the asset management industry, we believe the situation in the country must improve over time,” the company said in a statement, noting that many people hold such bonds in their mutual funds or investment accounts.

“We recognize that the situation is complex and evolving and that Venezuela is in crisis. We agree that life there has to get better, and we made the investment in part because we believe it will.”

 Facing Hunger

But the protesters say any support for the government supports repression. “For 18 years, we have lived with the systematic destruction of our country. We’re facing hunger, there are no medicines. This good business deal of Goldman Sachs is at our expense,” said Diana Carvallo, a 65-year-old artist who splits her time between New York and Caracas. “That money will go to buy tear gas, bullets, weapons to repress” the people, she said.

What might seem like a wise investment could become more complicated for Goldman Sachs and other investors, after National Assembly president Julio Borges threatened on Monday to withhold payment on the bonds.

“Given the irregular nature of the transaction and the absurd financial terms,” Borges said he would recommend that any future democratic government “not recognize or pay those bonds.”

Since April 1, Venezuela has been beset by near daily protests and violent clashes with government forces that have left 59 dead.

Facing severe shortages of food, medicine and staple goods, due to economic mismanagement in the oil-rich but debt-laden nation, the opposition has demanded new elections to replace Maduro.

His term extends until January 2019 but Maduro has increasingly attempted to consolidate power, including calling for a new constituent assembly to reform the constitution.


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