Venezuela’s opposition may move funds on a smaller scale to avoid creditors

Venezuela’s government and opposition asked the United Nations in November to manage more than $3 billion in foreign banks now and gradually release the money for humanitarian efforts.

The fund is not yet operational and there is no timetable for its implementation. Adding to the uncertainty is the opposition’s recent replacement of the U.S.-backed caretaker government with new leadership, which Washington has said it recognizes.

President Nicolas Maduro’s socialist government and the opposition have been holding sporadic talks to end a years-long political deadlock in which the opposition’s refusal to participate in elections is unfair, while Venezuela’s economy has collapsed.

The opposition is backed by several Western countries and controls some Venezuelan assets abroad, including the refinery Citco Petroleum, whose creditor protection was extended by the United States this week. On Thursday, the opposition assembly appointed the Foreign Assets Management Committee.

At least one group of Venezuela’s bondholders opposes the proposed U.N. While supporting the fund, the opposition fears creditors will try to collect assets to recover more than $60 billion the country owes creditors.

The Maduro government stepped up pressure this week, saying there was no reason to return to talks in Mexico unless the assets were available.

Members of the opposition delegation have met with officials in Washington in recent days to discuss how to move money into the fund without disclosing it to creditors, four sources familiar with the matter said.

One option is to transfer relatively small amounts, they said, which would cost creditors more legal fees.

The sources did not give details on other strategies, but said moving the money would “take time”.

The U.S. State Department did not immediately respond to a request for comment on possible strategies to move the money, but a spokeswoman urged Maduro to continue negotiations while pooling funds.

“Of course there will be financial constraints,” opposition negotiator Thomas Guaniba told reporters on Thursday.

Guaniba confirmed the opposition had met with US officials about the fund this week, but declined to comment on the details.

“The delegation has not stopped its work, so the technical details can be resolved,” he said.

The United Nations has expressed full support for the potential fund, which it has said could support millions of Venezuelans, but has not provided details on how it might be administered.

“The UN continues to talk with parties to find a solution,” spokesman Stephane Dujarric said last week.