Venezuelan democracy in "terminal phase" as economic crisis deepens

Since 2014 and the fall in oil prices, Venezuela has suffered a deep structural crisis. The country is still immensely dependent on oil resources (95% of government revenues). The fall in oil prices has first triggered an economic crisis which is today turning into a democratic lockout.

Elected in 2013, as the legitimate heir of Hugo Chavez, President Nicolas Maduro is today the figure of the failure of Venezuela. The latest economic figure showing how critical the situation is came out on March 2nd: Venezuela’s foreign currency reserves hit a new low at 10.2 billion dollars, a level unseen since 2002. In parallel, the country owes 7.5 billion dollars in debts. Between 2005 and 2012, the country’s reserves fluctuated around 30 billion dollars. Since 2014 (24 billion dollars), this amount has kept falling. The period of low oil prices (2014-2016) has deeply affected the Venezuelan economy. As a consequence, imports have been cut and the inflation rose. In 2016, inflation hit an estimate 800% while GDP decreased by 10%. The massive inflation has caused a situation of economic and social insecurity and more and more households fall into a state of poverty.

The collapse of the economy put Maduro into the light as he was unable to find a solution to the crisis. During the golden years of high oil prices, subsidies and price controls helped maintain the situation stable. However, Venezuela’s economic crisis is hard to measure as key figures, such as inflation, are not published anymore by the government. Evaluating the economic conditions in Venezuela has become a tricky task and depending on sources, figures can come out with important differences.

What is sure is that shortages of food and generic medication among other basic goods have become generalized. According to a study by the National Survey of Living Conditions in Venezuela, 75% of Venezuelans have lost an average of 8.6 kg because of food shortages. One third of the population (9.6 million people) declare they only have two meals per day.

In front of the emergency of the situation, the government led by President Nicolas Maduro engaged in a political war against the opposition party. Since the beginning of the crisis, Nicolas Maduro’s rhetoric has consisted in denunciating the influence of external powers among the opposition. For the President, the crisis has been indirectly triggered and influenced by Washington with the objective of placing a US friendly figure in charge of the country. 

After winning the majority inside Congress in December 2015, the opposition parties, united in the “Democratic Unity Table”, have been calling for the organisation of a referendum against Maduro. For the past two years, they have encouraged popular protests against the government but they faced a violent repression and some of the protest leaders have been arrested and kept in jail. One of them is Leopoldo Lopez, a former mayor of Chacao – an administrative subdivision of the capital, Caracas - and figure of the opposition, who has been in jail for three years now. He faces a 14 years jail sentence for encouraging violence in anti-government protests. His wife, Lilian Tintori, has been trying to draw interest from prominent international personalities on M. Lopez’s case in order to put pressure on Nicolas Maduro. On February 15th, Ms Tintori met with President Donald Trump to evoke the situation in Venezuela. Immediately after this meeting, the Venezuelan government decided to cut the Spanish broadcast of CNN in Venezuela.

In light of this move, Julio Borges, President of the Parliament, declared that “democracy is in its terminal phase”. As head of the opposition, holding the majority in Congress, Julio Borges has been trying in many ways to eject Maduro out of power, notably by organising anticipated presidential elections (due in December 2018). So far, the opposition has failed in doing so, mainly because Nicolas Maduro has the backing of the judiciary which has firmly invalidated any attempt at taking Maduro out. As a matter of fact, in January, the Supreme Court, handpicked by Maduro, announced that it did not recognize the authority of the current Congress. 

In November, the Venezuelan election board - said to be close to Nicolas Maduro - decided to postpone state governships elections due in December to a later date, which has yet to be communicated. Government officials declared this exceptional measure was taken in order to counter the suspected US-led influences among the opposition. The political polarisation in Venezuela took an even stronger stance when Nicolas Maduro appointed new Vice President, Tareck El-Aissami on January 4th. A highly controversial figure, M. El-Aissami has faced allegations of being linked to drug trafficking and terrorism networks. In February, the US Treasury Department freezed millions of dollars of assets supposedly detained by him. 

The critical situation in Venezuela is not just an economical slump. A humanitarian crisis is ongoing and every day many Venezuelans make the choice to cross the Colombian border in order to renew with decent living conditions. Now, the democratic stability of the country is at stake. The government has overruled the Constitution several times and there seems to be hardly any margin for the opposition to obtain the organisation of a referendum before the presidential elections in December 2018. Until this date, the opposition will try to earn support from the international community. The country's membership in the Mercosur and the Organisation of American States (OAS) could be suspended since both regional organisations value democracy as a membership condition.