Why would anyone in their right minds invest in Venezuelan debt, which is considered the riskiest sovereign debt on the planet? It’s a question quite a few people may be asking themselves right now, given the announcement on Sunday by finance minister Jorge Giordani that a $3bn issue is on its way after all (despite a number of recent denials).

Ok, so it’s considered to be mighty risky – but is that altogether fair? Venezuela may happen to be run by a rather temperamental president who assures us that he is trying to turn his country into a socialist paradise, but it’s also true that Hugo Chávez has never defaulted on any debt, or even threatened to do so; and for now at least there is no particular reason why Venezuela should need, or even want to.

There’s no question that this issue, which is denominated in dollars but payable in local currency, will be snapped up by locals, who have a near insatiable demand for dollars given the currency controls in Venezuela (mostly from companies wanting to import goods or repatriate profits, but individuals too). But when they turn around and sell on the secondary market, how should investors react?

Given the unparalleled returns that Venezuelan debt offers, particularly when there are so few attractive options out there at the moment, some analysts see few good reasons why not to grab it while you can.

The most obvious problem, of course, is when to sell – if indeed, in the event, you can. That’s probably why people like Alberto Bernal at Bulltick Capital Markets continue to be skeptical:

We think that despite tempting yields and an environment of increased risk appetite and search for yield, the uncertain times combined with inconsistency and unpredictability of policy in Venezuela, provide more than offsetting downside to juicy pricing for a country with 20 per cent public debt/GDP and low default probability. In a generally “unusually uncertain” economic environment (according to Ben Bernanke) we do not think that in the event of a turn in risk appetite for whatever reason that the market will look favorably upon as volatile and uncertain an investment story as is Venezuela. We continue to recommend underweight positions in Venezuelan bonds at this point. We maintain that among the high-yielders in the Latin America region, Argentina remains a far better investment option compared to Venezuela, regardless of the possibility of oil prices continuing to inch higher