Once a company with coveted jobs and “above average” salaries and now a troubled giant, Venezuelan state-owned oil company PDVSA has succumbed to the economy around it and left employees “struggling to pay for everything from food and bus rides to school fees as triple-digit inflation eats away income” according to Reuters’ Alexander Ulmer.
The company is risking defaulting on debt repayments unless it can sort a deal immediately. The Economist reports a bond swap solution could be close, as it is set to swap 2017 bonds for debt due to be collected by 2020, totaling $5.3 billion and backed by US subsidiary, Citgo Holdings.
Venezuela is in possession of the world’s largest oil reserves, providing 90-95% of the country’s export revenues.
There is also disillusion over the media coverage of PDVSA troubles, as the late Hugo Chávez had promoted the company’s’ profits to be destined for “social spending” according to The Economist. While Reuters wrote that the company refuse to comment on former workers “bartering” for food or selling overalls, gloves, and household items to feed themselves.
It has instead claimed that employees are happy and state television regularly shows crowds of cheering PDVSA workers in red overalls. Before citing a right-wing media campaign to discredit late leader Hugo Chavez’s “21st century Socialism.”
Further to these claims, the opposition party in government has said investigations into the company’s finances show “$11 billion went missing” from 2004-2014.
What happens next will seal the fate of the company deepening debt woes or salvage it with the country’s economy in the balance. But before then many might have left the company, if not the country.