The International Monetary Fund and World Bank boards held separate meetings last week to evaluate Venezuela’s ongoing economic stabilization efforts and its debt restructuring prospects, signaling renewed multilateral engagement with the country’s government.
- Inflation in Venezuela declined by 12 percentage points in 2025, down to over 1,000% annually.
- Fiscal deficit narrowed to 4.3% of GDP in 2025 from 7.1% in 2024.
- World Bank proposes $2.3 billion in infrastructure investment, conditional on oversight mechanisms.
- Only 42% of Venezuela’s population accesses formal health services.
- Venezuelan sovereign bonds trade at 32 cents on the dollar.
- IMF and World Bank boards are assessing reform credibility before finalizing financial support frameworks.
The IMF board reviewed Venezuela’s progress on macroeconomic reforms, including fiscal consolidation, exchange rate unification, and the restoration of central bank independence, as part of a broader effort to unlock financial support. The World Bank board examined the country’s infrastructure rehabilitation plans and social protection initiatives, focusing on long-term development viability. Both institutions emphasized the importance of credible governance reforms and transparency in upcoming funding decisions. The IMF’s executive board noted that Venezuela’s inflation rate, while still exceeding 1,000% annually, has declined by 12 percentage points since the beginning of 2025, a development attributed to tighter monetary controls and partial currency stabilization. Fiscal deficits narrowed to 4.3% of GDP in 2025, down from 7.1% in 2024, reflecting improved revenue collection and reduced subsidies. However, the board stressed that sustained progress hinges on structural reforms and the implementation of an anti-corruption framework. The World Bank highlighted that over 60% of Venezuela’s critical infrastructure—particularly in water, electricity, and transportation—remains in disrepair. A proposed $2.3 billion infrastructure investment plan, supported by a multilateral trust fund, is under review, with conditional disbursements tied to independent monitoring and public oversight mechanisms. The bank also reiterated concerns about social safety net coverage, with only 42% of the population accessing formal health services. Market participants reacted cautiously, with Venezuelan sovereign bonds trading at 32 cents on the dollar, reflecting lingering skepticism about debt sustainability. Investors are awaiting clarity on the government’s ability to meet international transparency standards and secure a formal agreement with the IMF on a Stand-By Arrangement. Regional partners, including Colombia and Brazil, have signaled willingness to support regional economic integration if reforms are maintained.