>> Cash strapped and crisis wracked, Venezuela has been unable to pay for food, medicine, and other essentials. And soon it might be unable to pay its debts. President Nicolas Maduro made a surprise announcement late on Thursday. He wants to restructure the nation's foreign debt, including 50 billion in bonds.
> And that has global investors afraid Venezuela could be looking at a total default. Reuters' Latin-American business editor Christian Plumb.>> I mean, pretty massive sell off in a lot of global bonds. Venezuela has borrowed a bunch of money from investors throughout the world. Once upon a time this debt was subscribed to and traded at a fairly normal price.
Over the years it's gone down. Today,
me of those bonds went down quite a bit more. And specifically, you also have bonds that were issued by the PDVSA. They're a crucial source of foreign currency. They're a national oil company. And some of those bonds are getting hit really hard as well.
>> If Caracas goes ahead with renegotiating its bonds, investors warn it could spur a sovereign debt crisis of a scale not seen in decades. A massive 2001 default shut Argentina out of global financial markets for years. Maduro says the US and foreign powers are to blame for wrecking Venezuela's economy.
Maduro's critics, however, say he has exasperated Venezuela's crisis by so far prioritizing making debt payments over importing essential goods. Soon Caracas might be unable to afford either. Food and medicine shortages have inflicted massive suffering on Venezuela's 31 million residents, leading to widespread malnourishment among children and death from preventable diseases.
Venezuela has few avenues to take, because the US imposes sanctions on the Latin American nation. And worsening investor skepticism that Maduro was serious about overhauling the struggling economy.