Once the richest country in Latin America, the economic, political and humanitarian crises that have engulfed Venezuela are threating to destroy what is left of an already unstable country. Once a prosperous country, Venezuela now has the highest level of inflation and almost all its citizens are unable to purchase necessities. Contrary to popular belief, the economic crisis has been brewing for the past twenty years, but only now has its underestimated severity manifested in both political and humanitarian troubles of a comparable magnitude.
The story began in 1998 with the election of Hugo Chavez, the “Peoples’ President.” Venezuela’s massive oil reserves started to bring in vast amount of wealth in the early 2000s with the price of oil per barrel soaring. This allowed Chavez to pioneer a soft revolution to expand social services and help alleviate the suffering of the poor despite the presence of an unaffected elite political cabal. Poverty rates fell from 50% in 1998 to 30% in 2012, and this was mirrored by the people’s collective love for their president. However, Chavez’s increasingly socialist policies expanded when post-2006, Venezuela lost most of its private businesses due to the government nationalising industries and thus destroying the production capacity of the nation This was not a concern as by 2012 oil exports accounted for 95% of all Venezuela’s exports, making Venezuela the richest country in Latin America. However, Chavez’s tri-part economic legacy encompassed massive debt, an exhausted sovereign wealth fund and a blind reliance on the ability of the oil boom experienced from 2004-2014 to finance the transition of Venezuela from a democracy to a more socialist nation.
Chavez’s death in 2013 saw the election of President Nicholas Maduro, his handpicked successor. It was intended that the heir apparent continue the Chavez legacy. Venezuela, now highly vulnerable to external shocks relating to its oil revenue, saw its economy shatter with the plummet of oil prices in 2014. The global price fell from $111 per barrel in 2013 to $27 per barrel in 2016. This saw Venezuela’s inflation reach 800% in 2016. In 2017, Venezuela owed its foreign creditors over $150 billion whilst only having less than $10 billion in its reserves.
The soaring inflation and increased debt rendered the government incapable of importing food, medicine and other basic goods. With the lack of private business in the country, Venezuela was slowly heading into a worsening humanitarian crisis. By 2017, 97% of the population did not have enough money to buy food. Since 2016, the infant mortality rate has increased from 30% to 65%, with 85% of basic medicine being unavailable or unattainable. In 2016, Venezuela experienced the highest homicide rate in its history and official estimates recorded over 500,000 Venezuelans fleeing to neighbouring Brazil and Colombia.
Parallel to the humanitarian and economic crisis that has emerged, President Maduro has seen the country spill into political chaos as he steers it into an increasingly authoritarian regime. This was first evidenced in 2016 with when the opposition (Democratic Unity Roundtable Party) took the majority in the National Assembly for the first time in two decades. Maduro dissolved the National Assembly through his control over Venezuela’s Supreme Court. On July 30th of the following year, Maduro replaced the National Assembly with a Constituent Assembly. This assembly was vested with sweeping authority to revise both extant laws and the constitution. The Constituent Assembly consisted entirely of Maduro supporters and appointed ministers leading to widespread protests from the opposition and the country’s population. Maduro’s subsequent banning of three opposition parties from the 2018 presidential race incited mass international condemnation and the instalment of various sanctions on the regime. These steps towards consolidating his own rule have led to nearly daily protests and, in commensurate measure, institutionalised political repression. Protesters now take to the streets to fight not only for the right to attain basic food and medicine but also to fight for their democratic rights in a once prosperous nation.
There will be no regime change on the horizon for the foreseeable future. There will be no end to the economic crisis that has festered into a political and humanitarian crisis. No military coup will emerge soon as Maduro, although economically depleted, still commands enough revenue to continue to pay the armed forces and provide them with handsome concessions. No amount of international sanctions from the United States, France or any other country can lead to the regime’s collapse especially due to Venezuela’s strong allies. Regional powers such as Bolivia, Nicaragua and Ecuador have protected the legitimacy and strength of Maduro’s leadership. Global allies such as China and Russia have assisted the regime by buying oil and extending loan repayment periods. This has kept the regime afloat and will continue to for the near future.
Only the collective strength of the people can open the gateway to democracy. Maduro has eliminated almost all political opponents and has continued to repress his already suffering citizens. Although they protest, the politics of starvation have assisted Maduro in repressing the people. Democratic transition does not seem hopeful presently but what remains is the hope that protesters continue to dispel as they fight to win back the once prosperous Venezuela.
