Venezuela just made a full payment on a $1.5 billion bond, but the country is hardly out of the debt woods yet. Experts say the country, plagued by hyperinflation and a shortage of basic goods, will almost definitely default — the question is how, and when.
Venezuela's central bank said earlier this month that the country's economy shrank 5.7 percent, and the official rate of inflation came in at 180.9 percent in 2015. That spells trouble for the country, which has a $10 billion total debt burden for the year.
Still, the country has been able to maintain its obligations by draining its foreign currency and gold reserves — even as its citizens struggle in a deep recession. That's despite suggestions from some quarters last year that the country could default in 2015.
In a Spanish-language statement on its website, the Venezuelan finance ministry said its debt payment on Friday was proof of "willingness and capacity to honor its financial commitments in a timely manner," but the boast of an "impeccable" payment record doesn't address a more interesting question: Why is Venezuela willing to go so much further to pay its debts than many other struggling countries are?