Venezuela: A Crisis in Hand

Venezuela has become a melting pot of conflicting interests and ideologies. The economic downturn and accompanying political unrest have exacerbated the situation. Due to rising economic hardships combined with censorship, repression, bans, and illegal detainment of opposition members, the general populace has started resenting Maduro’s political authoritarianism. However, in a country where the political elite and the military have pledged their loyalty to Maduro, it presents a difficult conundrum for Venezuelans to reject Maduro’s claim of victory in the 2024 presidential elections. As a result of this ongoing political and economic unrest, Venezuela is experiencing one of the worst cases of forced displacement, a crisis that began in 2014, with nearly 7.7 million people having already left their homeland in search of stability and better livelihood.

According to the National Electoral Council (CNE), Nicolás Maduro, who has been the president of Venezuela since 2013, emerged victorious in the presidential election held on July 29th, 2024 garnering about 51% of the votes. His opponent, Edmund González Urrutia, received 44% of the votes. However, González, along with opposition leader María Corina Machado, claimed that they had won two-thirds of the tally sheets generated by each electronic voting machine after the polls closed. To support their claim of receiving 67% of the votes in the presidential election, the opposition party released nearly 80% of the tally sheets to the public. Nevertheless, no credible evidence has been presented to confirm the legitimacy of the Maduro-led government’s victory.

However, the results of these elections have sparked protests across Venezuela, leading to thousands of arrests and criminal investigations against the general population. In response, the Unitary Platform (the opposition) had called for global protests as an extension of the ongoing demonstrations against the allegedly unfair presidential elections held last month. These elections have attracted considerable global attention with the USA and the EU refusing to recognise the results. Amidst a protracted power struggle between the two major political parties—the United Socialist Party of Venezuela (in power) and the Unitary Platform (opposition)—the country continues to face severe political and economic hardships, with no relief in sight.

Venezuela continues to grapple with soaring inflation, mounting debt, widespread poverty, rising crime rates, and severe political unrest. Currently, 66 percent of Venezuela’s population require humanitarian assistance, with almost 65 percent having lost their livelihoods. According to the UN’s 2022 Regional Overview of Food Security and Nutrition, Venezuela is one of the most undernourished countries in South America. With nearly 72 percent of the population lacking access to public health services and basic facilities, the nation is in dire need of humanitarian relief.

Once considered a socialist state and one of the richest countries in Latin America, Venezuela underwent the Bolivarian revolution under Hugo Chavez’s autocratic rule. This period saw an increase in social programs and a reduction in poverty to around 20%, though these achievements were made under Chavez’s authoritarian regime. With the emergence of Venezuela as a socialist state, hundreds of private businesses and foreign assets were nationalized, and Petróleos de Venezuela S.A. (PDVSA) was henceforth established as a vital source of income for the Venezuelan government. This also led to several foreign investors disengaging from Venezuela as they refused to modify their contracts to meet Chávez’s demands. 

Chávez also made two significant decisions in the early 2000s which led to increased problems for Venezuela’s oil sector: first, to provide subsidized oil to multiple countries in the Latin American region, and second, to fire 19,000 employees from the state-owned PDVSA, thereby removing much of the technical expertise from a highly capital- and technology-intensive oil industry. As a petrostate, 95% of Venezuela’s exports and 25% of its GDP come from its natural gas and oil reserves. Consequently, rising oil prices benefit the Venezuelan economy, making oil trade the backbone of its economic structure. During the oil boom of the 1970s, rising oil prices largely spurred economic growth of Venezuela. Subsequently, Chávez funneled billions from the oil business to fund the nation’s social programs, but he failed to sufficiently reinvest in this capital-intensive sector. This severe mismanagement of the world’s largest proven oil reserves in Venezuela contributed to the country’s deteriorating economic condition.

U.S. sanctions also played a significant role in the already poor economic condition of Venezuela. Beginning in 2005, the United States withdrew its economic and trade ties with Venezuela, as successive U.S. presidents consistently cited the country’s failure to control terrorism, drug trafficking, and human trafficking networks. As Venezuela’s political climate became increasingly autocratic, the U.S. significantly reduced its engagement with the country. Subsequently, the U.S. government imposed various sanctions on PDVSA, severely damaging Venezuela’s financial lifeline. However, the Biden administration partially lifted these sanctions in 2024 in exchange for allowing the Machado-led opposition to select a candidate to run for president, thereby ensuring a free and fair electoral system. This move aided in the nation’s economic recovery as the U.S. eased some of the sanctions. However, due to the Maduro-led government’s continued unfair and undemocratic electoral practices, the U.S. government reinstated the majority of the lifted sanctions in April 2024.

In contrast to the United States and numerous other global powers, China continues to endorse Maduro and considers the results of the 2024 presidential election as legitimate, viewing Maduro as a beacon of hope for Venezuelan stability. This is not surprising, given China’s long-standing and mutually beneficial relationship with the left-leaning Chávez administration, which Maduro has supported over time. In addition to Venezuela’s recognition of China as a “strategic partner for all weather conditions”, China is the largest buyer and creditor of Venezuelan crude oil. Moreover, China remains one of Venezuela’s main creditors through its policy of providing loans in exchange for oil. Overall, China’s primary concern in Venezuela is ensuring the viability of its loans, investments, and future projects that they have undertaken together with Venezuela under Maduro’s regime, which represents China’s gateway to the riches of Latin America.

The international powers have conveniently aligned themselves with either Maduro or Machado, reflecting a broader divide between capitalist and socialist stances. The West is backing Machado and Gonzalez in their liberal and capitalist endeavors, while China and Russia are supporting Maduro in his socialist and nationalist aspirations. But in practice, both China and the United States align with whatever serves their own interests; they are not genuinely concerned with Venezuela’s internal power struggles or dynamics. They have, instead, oversimplified this complex national crisis into a war of ideologies. 

Over the years, Maduro’s prominence has elevated him to a significant position in the global community. His unwavering personality has sustained his authoritarian regime for over a decade, but this same rigidity now seems to contribute to his potential downfall. The large protests organized against his regime, if not contained, could escalate into widespread civil unrest. Signs of violence and aggressive rebellion are already emerging, with around 23  people reported dead and about 2,400 individuals illegally detained, according to the latest UN data. UN human rights investigators have urged Maduro to stop repressing the elections and the Venezuelan civilians as they continue to investigate human rights violations in the region. 

With major international powers like the USA, China, and various Latin American states becoming more involved in the region, the situation could likely escalate if Maduro continues to cling to power despite strong opposition from the Venezuelan people. The only way to resolve this issue is for Maduro to address the broader demands of his citizens and bridge the political divide before time runs out, given the extensively volatile and impoverished condition that Venezuela continues to endure. What Venezuela truly needs now is a leader who can open new opportunities, create jobs, provide access to basic infrastructure and healthcare, reduce barriers to international trade, attract foreign investment, and stabilize the political atmosphere, thus encouraging overall positive growth. As an average of 2,000 people continue to leave the country daily, amid rising protests and severe unrest, the ultimate goal of resolving this intense power struggle and instability should be the betterment of the Venezuelan people.