Venezuelan authorities are considering seeking a bridge loan from Qatar to clear more than $2 billion in arrears to the Inter-American Development Bank, a move that could unlock fresh financing from the lender, six people with knowledge of the matter said. Venezuela urgently needs funding to revive its power grid and infrastructure after years of underinvestment and poor maintenance.

However, the country has been in default on much of its external debt for nearly a decade, effectively locking it out of financial markets. Financial sanctions by the United States impose additional restrictions.

The IDB ceased issuing new loans to the South American nation in May 2018 after the country fell behind on payments.

In an effort to resolve the IDB debt and with US support, Venezuelan authorities may tap Qatar for a loan, the people said. Clearing its arrears would enable Venezuela to resume receiving financing from the multilateral institution.

The IDB had no comment. Venezuela’s Ministry of Communication and the US Department of the Treasury did not respond to requests for comment.

Qatar's Ministry of Foreign Affairs did not immediately reply to a request for confirmation and comment. The IDB said last month it was preparing a two-year engagement plan for Venezuela focused partly on electricity and social protections.

Reuters later reported that the IDB president was working to secure approval for a $2.5 billion loan for Venezuela, but faced opposition from some members of the institution’s board of directors.

The country's National Assembly is weighing approval of a reform which would open the electricity sector to foreign investors, after nearly two decades of state control. One of the people said that once Venezuela has cleared arrears and the IDB approves an initial disbursement, the funds could be used to repay Qatar, allowing Caracas to continue accessing financing lines from the multilateral lender.

The people spoke on the condition of anonymity. Venezuela’s acting President Delcy Rodriguez, who assumed power following the US capture of President Nicolas Maduro in January, said this month that she expects the country to receive $12 billion in public and private financing over the next two years, following the resumption of relations with multilateral organizations.

Two people indicated the United States has suggested the IDB assist in the recovery of the country’s power sector, which is facing problems in power generation and distribution. Although the Venezuelan government has recently announced agreements with companies such as GE Vernova and Impsa to restore electrical infrastructure, power outages happen frequently in parts of the country.

Venezuela faces the challenge of addressing its high debt amid a liquidity crisis, with oil revenue lower than a decade ago, and a growing fiscal deficit. In May, the oil-rich nation announced a debt restructuring which could exceed $200 billion and is expected to be time-consuming and contentious. Venezuela’s obligations include bonds, loans from multilateral institutions, arbitration awards, bilateral loans, and commercial debt.

This month, the IDB reopened its Caracas office, and IDB Invest representatives met with government officials and business leaders. According to one person, a proposal was discussed for IDB Invest to provide financing to Venezuelan banks and companies, with such financial support contingent on repayment of existing debt.