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Events in Venezuela over the past week have added a new sense of urgency to the long-running crisis of the Maduro regime. In the midst of ever fiercer protests against Maduro’s government and the United Socialist Party of Venezuela (PSUV), the inauguration of a new Constitutional Assembly by the government, widely criticized by the opposition and internationally, provoked the most serious challenge to the security of the regime yet: an attack on a military base by a band of armed civilians led by a junior officer who defected earlier in the year. This marks a more serious escalation of the protests as deaths in street battles between protesters and government forces climb into the hundreds. What led to the current situation?

Nicolás Maduro came into office in 2013 in Venezuela after the death of Hugo Chávez, whose Fifth Republic Movement swept into power at the turn of the century. Although events have been moving much more quickly in recent months, the current crisis has its roots much earlier.

An opposition activists wears a "gas mask" made out of a bottle of drinking water during a protest against the government in Caracas on May 12, 2017. / AFP PHOTO / FEDERICO PARRA (Photo credit should read FEDERICO PARRA/AFP/Getty Images)
An opposition activist wears a “gas mask” made out of a bottle of drinking water during a protest against the government in Caracas on May 12, 2017. / AFP PHOTO / FEDERICO PARRA (Photo credit should read FEDERICO PARRA/AFP/Getty Images)

In 2014, global oil prices collapsed, hitting Venezuela (which is estimated by OPEC to produce two million barrels of oil every day) hard in its most vital source of export revenue. The drop in oil revenue led to disruptions in social programmes, including healthcare and education initiatives, which the socialists have used to support their long hold on power. The long-term sustainability of the government’s social programmes was questionable.

As part of Venezuela’s ‘Integral Cooperation Agreement’ with Cuba in 2000, Venezuela agreed to export oil to Cuba (as much as 90,000 barrels per day) at a discounted rate (interestingly, some of this discounted oil is actually re-exported by the Cubans as it exceeds the Cuban daily oil consumption when combined with their other sources of oil). In return for subsidized oil, the Cubans send advisors to Venezuela to train its security forces, combat illiteracy and provide medical services. Such advisors number in the tens of thousands. Although links continue to appear strong (Maduro has been reported to have visited Cuba over 15 times since he became president), the Venezuelan government cannot continue to take Cuban economic support for granted. The resources sharing agreement may be under risk if Cuba suffers from a future restructuring of Venezuelan debt. The US could also use the Venezuela issue to gain leverage over Cuba in the battle over the embargo on the Caribbean island. If withdrawing economic support for the Venezuelan regime would increase the chances of the US embargo on Cuba being lifted, the balance could begin to shift against even more against Maduro.

A police officer looks on as opposition supporters confront riot security forces while rallying against President Nicolas Maduro in Caracas, Venezuela, May 12, 2017. REUTERS/Carlos Garcia Rawlins - RTS16E0A
A police officer looks on as opposition supporters confront riot security forces while rallying against President Maduro in Caracas, Venezuela, May 12, 2017. REUTERS/Carlos Garcia Rawlins – RTS16E0A

The socialist government’s social programmes are also partly funded by Chinese loans, which are provided in exchange for oil exports. If Chinese investment, which has funded a range of infrastructure and manufacturing projects, dries up, the Venezuelan government would lose another key lifeline. China will support a government that promises to honour its financial commitments, so if the opposition seems more likely to be able to fulfil this condition, Maduro would face another unfriendly power.

Although both Cuba and China would, for now, prefer the Maduro regime to stay put, the apparent fragility of both bilateral relationships casts doubt on the sustainability of a strategy of paying for social measures with volatile oil money.

Ordinary Venezuelans are certainly noticing the drawbacks of such a strategy. As inflation shoots past 700 percent, living conditions continue to decline sharply. One survey found that food shortages have become so severe that 75 percent of the population has lost at least 19 pounds in body mass last year. The same survey found that 93 percent of Venezuelans do not have enough money to cover their food expenses. The results of this survey are no surprise to those observers who have grown accustomed to seeing pictures of empty supermarket shelves being reported in the media.

Internal wrangling 

The recent escalation of the crisis came at the end of March when the Supreme Court, a body packed with Maduro supporters, used the pretext of the legislature’s failure to expel three opposition members to seize some key powers for itself, an action Secretary-General of the Organisation of American States (OAS) Luis Almagro condemned as the ‘final blow to democracy in the country’.

However, more was yet to come. The government announced plans to convene a new Constitutional Assembly with the power to rewrite the constitution and dissolve the opposition controlled national assembly. Maduro has claimed that the Constitutional Assembly is necessary to bring about national reconciliation, but critics fear that it is a tool to allow the PSUV to cling onto power. Indeed, despite initially claiming that the new assembly would meet for only 2 months, party vice-president and staunch Maduro supporter Disdado Cabello has now said that the Assembly could last as long as two years. When the current constitution was being drawn up by Chávez in 1999, the normal legislative assembly was suspended. The opposition, consisting of the Democratic Unity Roundtable (MUD), a coalition of opposition parties with a two-thirds supermajority, fear a similar suspension of the current legislative assembly. The fact that the new Constitutional Assembly meets in the Legislative Palace has added to fears that its real intention is to eclipse the legislature over which Maduro has little sway.

President Nicolas Maduro together with Socialist Party Vice-President Diosdado Cabello (R) next to a portrait of Hugo Chávez. (Jorge Silva / Reuters)
President Maduro together with Socialist Party Vice-President Diosdado Cabello (R) next to a portrait of Hugo Chávez. (Jorge Silva / Reuters)

Fearing that the Constitutional Assembly will use its powers to withdraw the immunity from prosecution enjoyed by legislators, the opposition has called into question the legitimacy of the results of the referendum on whether to introduce the new Assembly. The government claims that the poll, which was boycotted by the opposition, attracted 8 million voters, but this has been contested by Smartmatic, the company that provided the voting system, which claims that the government’s turnout figure was inflated by at least one million. An unofficial referendum held by the opposition claims to have received 7 million votes against the establishment of the Constitutional assembly.

The government’s actions have drawn some significant dissent from within, most notably from the former Prosecutor-General Luisa Ortega who was forced out of her job as security forces surrounded her office in Caracas last week. Ortega initially broke ranks with the government in March when she opposed the Supreme Court’s actions stripping the National Assembly of its powers. She later contradicted the government line on the death of a 20 year old protestor, Juan Pablo Pernalete, who she argues was killed by a tear gas canister fired by security forces, not by a fellow protestor as the government insists. Her challenge to plans to establish the Constitutional Assembly sealed her political fate; one of the first acts of the new body was to remove her from office. Her involuntary departure and replacement by Maduro ally Tarek William Saab suggest that the new assembly will be responsible for much more than simply rewriting the constitution.

Regional opposition 

Such arbitrary actions are increasingly leading Venezuela down a path of international isolation. The situation could become direr if Venezuela’s estrangement from OAS continues. In April, Delcy Rodríguez (then Minister of Foreign Affairs, now Speaker of the new Constitutional Assembly) announced plans for Venezuela to leave the OAS, joining Cuba in hemispheric isolation. Venezuela’s suspension from Mercosur, the regional trading bloc and customs union, is a further sign of Maduro’s failing international position. Several airlines, including Avianca, Delta, Aeroméxico, Alitalia, Latam, Lufthansa and United have ceased flights to the country. Columbian President Juan Manuel Santos, a regional ally of the US, has said that Columbia will not recognize the legitimacy of the Constitutional Assembly. The land border between the two countries has been closed since 2015.

Perhaps the most serious international threat to the Maduro regime comes from the US. Earlier this year, the Trump administration froze all of Maduro’s assets in the US and banned US firms and individuals from doing business with him (though this is more of a symbolic move as it is not believed that Maduro personally has any substantial business interests in the US). These were on top of earlier sanctions placed on several high-ranking officials suspected by the US Office of Foreign Assets Control (a Treasury Department agency) of involvement in drug trafficking.

President Donald Trump meets with President Juan Manuel Santos of Colombia in the Oval Office of the White House on May 18, 2017 in Washington, DC.
President Donald Trump meets with President Juan Manuel Santos of Colombia in the Oval Office of the White House on May 18, 2017 in Washington, DC. /Getty Images

The spectre of US sanctions on the oil industry will no doubt be the biggest cause for concern among Venezuelan officials. If imposed, oil sanctions could prevent the state oil company (PDVSA) access to vital finance. Sanctions would likely prevent oil revenues being processed through US financial institutions, therefore creating a critical emergency for the regime. Several commentators have suggested that this could provoke a coup, but this is far from an inevitable situation. Firstly, despite intense lobbying by the likes of Senator Marco Rubio to take a tougher line on Venezuela, the US administration has been cautious, perhaps wary of forcing the oil services companies Halliburton and Schlumberger out of Venezuela. Moreover, even if oil sanctions were imposed, the military could still stay loyal. Although there is dissent, mid-ranking military officers are under close surveillance by counterintelligence authorities who seem to have been able to keep any potential military rebellion under wraps. Moreover, Venezuela has historically been far less prone to coups than its Latin American neighbours.

As the stability of the Maduro regime hangs in the balance, it is worth remembering that despite PSUV’s drawbacks, it is still unclear whether the faction-ridden opposition can provide a coherent and effective opposition to the status quo. Venezuela’s problems will not be solved solely by the collapse of the Maduro regime, and there is no guarantee that what will come after Maduro will be able to relieve the suffering of the Venezuelan population.

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