Panama cuts diplomatic ties with Venezuela in response to economic sanctions

Panama has severed its diplomatic ties with Venezuela after the imposition of sanctions by Caracas on senior Panamanian companies and officials amid an escalating diplomatic row.

Venezuela orders Copa Airlines out of the country.

Venezuela said on Thursday that it was halting “commercial” relations with Panamanian companies, including regional airline Copa, for alleged involvement in sabotaging the Venezuelan economy.

“The government of Venezuela has decided to suspend economic and financial relations with legal entities and individuals from Panama for 90 days,” read the message.

Copa was one of the few international air carriers still serving crisis-ridden Venezuela and the cessation of service means Venezuelan citizens who want to travel outside of the country will have limited options.

Venezuelan authorities declared their decision was connected with the need to protect the financial system of the state. In total, interaction with 46 legal entities and 22 individuals from Panama have been suspended.

In response, Panama has ordered Venezuela’s ambassador out and recalled its own envoy to the country.

“Panama’s government has decided to withdraw its ambassador to the Bolivarian Republic of Venezuela, Miguel Mejia, and asks the Venezuelan government to withdraw its ambassador accredited to Panama, Jorge Duran Centeno,” the Panamanian Foreign Ministry said in a statement.

It added that Panamanian President Juan Carlos Varela and nearly two dozen cabinet ministers and top-ranking officials had been sanctioned for allegedly rigging Panama’s financial system to sabotage the Venezuelan economy.

The once prosperous oil-rich leftist Latin American country is currently grappling with economic hardships intensified by political unrest.

Maduro blames the U.S. and the country’s U,S,-supported opposition for the hardships.

Political violence killed more than 120 people from both the government and the opposition camps in Venezuela last year.