Panama recalls ambassador from Venezuela as countries cut commercial ties | News | DW | 06.04.2018
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Panama recalls ambassador from Venezuela as countries cut commercial ties

Venezuela has announced it is halting commercial relations with Panamanian officials and firms. The move comes after Panama said Venezuelan President Nicolas Maduro was considered at "high risk" for laundering money.

Venezuela announced on Thursday it was suspending commercial ties with several Panamanian officials and companies. Among the firms targeted was regional airline Copa, one of few international carriers that was still operating in the crisis-stricken country.

The Venezuelan government's resolution prompted Panama to recall its ambassador shortly afterwards.

Read more: Venezuela: A country in meltdown

Caracas justified the decision to bar 46 Panamanian firms from operating within its borders for at least 90 days, claiming that several top-ranking officials and lawmakers, including Panamanian President Juan Carlos Varela, had been complicit in money laundering.

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It also said that Panama's financial system had been leveraged by wealthy Venezuelan nationals for acts of corruption.

Venezuelan President Nicolas Maduro's regime said that individuals named in the Panama resolution "present an imminent risk to the (Venezuelan) financial system, the stability of commerce in the country, and the sovereignty and economic independence of the Venezuelan people."

Venezuela's aviation authorities also announced that all Copa flights "to and from the country" would be suspended from April 6 to protect "the Venezuelan financial system."

Read more: Venezuela: Democracy under fire

Panama attacks Maduro regime

Panama's government, announcing the withdrawal of its envoy, described Venezuela's assertions as "a political reaction lacking substance," adding that it had also ordered Caracas to recall its ambassador.

Earlier, Varela labelled the accusations as nonsensical. "We have not heard anything about breaking relations but rather about a set of supposed sanctions - it's gibberish," Varela told reporters.

Venezuela's decision suspend ties likely came in retaliation to Panama this week naming 16 Venezuelan companies and 55 individuals as being at "high risk" of money laundering and financing terrorism. Among those named were Maduro, Vice President Tareck El Aissami and Attorney General Tarek William Saab.

A country on the brink

Venezuela's latest diplomatic dispute comes as the country finds itself teetering on the brink of financial default and engulfed in a devastating political and economic crisis.

The country has been gripped by hyperinflation, a lack of basic foods and medicines and skyrocketing violence for several months, prompting a mass exodus of its citizens.

The suspension of Copa flights could inflict further hardship on the Venezuelan population. The Panamanian carrier is the main airline used by passengers travelling in and out of Caracas, with flights usually fully booked weeks or months in advance.

Read more: Venezuelans launch new currencies amid economic crisis

Venezuela's political crisis has also seen it become increasingly isolated from the global community. More than a dozen other Latin American nations have taken measures against the Maduro regime.

The United States, European Union and Canada have also sanctioned Maduro and his regime's top officials, accusing them of human rights abuses and sliding Venezuela into a dictatorship.

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dm/bw (AP, AFP, dpa, Reuters)

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