Venezuela has paid Colombian exporters $365 million, about half of a debt that was created last year after trade was frozen between the bickering neighbor nations.
Venezuela's foreign minister, Nicolas Maduro, confirmed the payment after talks with Colombian counterpart Maria Angela Holguin in Caracas this week that focused on reestablishing strained trade and political ties.
The meeting is part of a series of gatherings between the nations that were scheduled last year after severed diplomatic relations were restored.
At that time, leaders for the countries also reached agreement on the first payment installment to Colombian exporters.
Late Wednesday, Maduro estimated the total debt owed at $700 million though the final figure could change during a final "certification" process.
During the escalated tensions between the countries last year, the sides argued over the amount, with Colombian exporters saying they were owed $800 million and Venezuela estimating the debt at $600 million.
The payment was initially held up after Venezuelan President Hugo Chavez broke off diplomatic relations in July after then-Colombian President Alvaro Uribe accused Venezuela of sheltering leaders of the Revolutionary Armed Forces of Colombia, or FARC.
A month later, Juan Manuel Santos was inaugurated as Colombia's new president and moved toward normalizing diplomatic relations with Venezuela.
Trade between the nations has not yet fully recovered, according to Fernando Losada, Director of Emerging Markets Research at Deutsche Bank. Venezuela has traditionally been the second-most important market for Colombian exporters after the U.S., but recent political tensions have weakened commercial ties.
Colombia's trade surplus with Venezuela has fallen from $5 billion in 2008, to $3.5 Billion in 2009 and $1.1 billion in 2010, Losada said.
With the recent thaw in diplomatic relations "bi-lateral trade has picked up but it has not recovered to levels prior to when relations were cut.
We are still a long way from pre-crisis levels," he said.
There are other potential challenges to fully restoring trade relations, Losada said.
Venezuela's foreign minister, Nicolas Maduro, confirmed the payment after talks with Colombian counterpart Maria Angela Holguin in Caracas this week that focused on reestablishing strained trade and political ties.
The meeting is part of a series of gatherings between the nations that were scheduled last year after severed diplomatic relations were restored.
At that time, leaders for the countries also reached agreement on the first payment installment to Colombian exporters.
Late Wednesday, Maduro estimated the total debt owed at $700 million though the final figure could change during a final "certification" process.
During the escalated tensions between the countries last year, the sides argued over the amount, with Colombian exporters saying they were owed $800 million and Venezuela estimating the debt at $600 million.
The payment was initially held up after Venezuelan President Hugo Chavez broke off diplomatic relations in July after then-Colombian President Alvaro Uribe accused Venezuela of sheltering leaders of the Revolutionary Armed Forces of Colombia, or FARC.
A month later, Juan Manuel Santos was inaugurated as Colombia's new president and moved toward normalizing diplomatic relations with Venezuela.
Trade between the nations has not yet fully recovered, according to Fernando Losada, Director of Emerging Markets Research at Deutsche Bank. Venezuela has traditionally been the second-most important market for Colombian exporters after the U.S., but recent political tensions have weakened commercial ties.
Colombia's trade surplus with Venezuela has fallen from $5 billion in 2008, to $3.5 Billion in 2009 and $1.1 billion in 2010, Losada said.
With the recent thaw in diplomatic relations "bi-lateral trade has picked up but it has not recovered to levels prior to when relations were cut.
We are still a long way from pre-crisis levels," he said.
There are other potential challenges to fully restoring trade relations, Losada said.
Venezuela will withdraw this April from the Andean Community of Nations, a regional trade bloc, meaning that standing preferential trade agreements between Colombia and Venezuela will expire.
"When Venezuela completes the withdrawal, something new is going to have to replace the... agreements," Losada said.
"Our expectations is that (trade) will rebound to pre-crisis levels."
"When Venezuela completes the withdrawal, something new is going to have to replace the... agreements," Losada said.
"Our expectations is that (trade) will rebound to pre-crisis levels."
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