Venezuela Country Risk Rating

Venezuela's overall risk remains at a very high level. Following the January US operation, in which airstrikes hit military sites across the north of the country and President Maduro was captured in Caracas, Venezuela is pursuing economic normalization without democratic transition. Delcy Rodríguez's interim government has complied with Washington's demands under the threat of further military action, while steadily consolidating its own position. Time favors the government, with US officials suggesting elections could take 9-10 months to organize even as Trump insists Washington will "run the country" until a "safe, proper and judicious transition". Repression persists through arbitrary detention, beatings and extortion, and the UN Fact-Finding Mission reported in March that the state's repressive machinery remains operative, welcoming recent detainee releases while criticizing the lack of transparency around them. The picture has since grown more fragile, as Rodríguez's interim mandate expired on July 3rd with no electoral timetable in place, opposition leader María Corina Machado was prevented from returning after the authorities closed Caracas airspace, and polling taken before the earthquakes put disapproval of Rodríguez above 90%. Political interference and violence are considered very high.

After Maduro's capture, the Rodríguez government passed a law allowing private companies to participate in the oil industry, and the US began easing various oil-trade sanctions in response. Still, amid this unstable environment, Venezuela faces very high legal and regulatory risks, exacerbated by rampant corruption, lack of transparency, and frequent regulatory changes. Businesses operating in the country face additional obstacles, including high taxes, weak law enforcement, low demand, unfair competition, limited access to financing, power outages, and security challenges. Consequently, the risks of doing business and supply chain disruptions are very high and high, respectively.

Data from the Central Bank of Venezuela puts Q1 2026 growth at just 2.5%, the lowest reading since 2021; nevertheless, crude exports have rebounded sharply, with tanker tracking putting April volumes between 1.1 and 1.2 mbd, the highest in years. Whether this translates into fiscal space for Caracas is another matter, since under the January energy deal Washington markets the oil and deposits proceeds into US Treasury accounts. Moreover, Caracas is preparing to reveal liabilities of roughly USD 240bn, well above previous market estimates of USD 150bn to USD 200bn, as it embarks on what would be the largest sovereign restructuring on record. The interim government re-engaged with the IMF in April, although the restructuring so far lacks Fund participation, and Rodríguez is targeting a deal with creditors by the end of 2026 that would pave the way back to international markets after nearly a decade of default under Maduro. The sovereign non-payment risk and the inability of the government to provide stimulus are both assessed as very high.

The twin earthquakes of June 24th have transformed the outlook. The official death toll had risen past 4,400 by mid-July and over 16,000 injured. The UNDP preliminarily estimates direct physical damage at USD 6.7bn, roughly 6% of GDP. A government already short of liquidity and struggling to contain the world's highest inflation must now organize a massive disaster response with no credit access, negligible insurance coverage and a widely criticized emergency effort, while the US has deployed close to 2,000 military personnel and pledged several hundred million dollars in assistance.