It’s home to the largest oil deposit in the world. It’s also home to poverty and hyperinflation – both of a kind unobserved anywhere else. Such is the contradiction that Venezuela’s economy and politics spell out for the onlooker. A single Google search about the country takes you to descriptive pieces about the country that thrives on rotten meat. Here, people flee from their homes than express a desire to stay back – where could home be when all you get here is starvation and poverty? Even when Hugo Chavez was keeping the spirits elevated to some extent in the country, the bitter truth still pointed at a status quo that kept the masses stuck neck-deep in poverty. To make matters worse, at the same time as Nicolás Maduro’s arrival as the chosen successor to Chavez, the oil prices fell. Thus, came crashing down an economy so dependent on the riches that oil brought in – with the sole income plummeting, welfare schemes too saw no hope of continuation.
But the problems run deeper. Venezuela’s economy is also marked by duality – on one level, the elites and those close to Maduro find themselves at the heights of privilege, while the commoners see their living conditions reach an upsetting low. Prices continue to escalate and drive people towards the black market. The pandemic has only deteriorated an already sable picture. At least Chavez had a key determinant in his kitty: popularity. This is absent in the case of Maduro. For all that matters, the only thing that he has a hold over is the military which the leader toys around with at the slightest exhibition of dissent. This loyalty that the leader enjoys is built on good pay and appointments to important positions of power. Maduro also has the apex court under control. As the United Nations remarked, the government resorts to fear-mongering to keep its power intact and unchallenged.
Amidst all of this, the US sanctions – which were intended to keep a check on the unruliness of Maduro and his cronies – has installed a haze that Venezuela’s leader can project all blame onto. Given that Biden has already opined against Maduro, the chances for these sanctions to be lifted seem bleak right now. As in the case of Iran, people are beginning to question the efficiency of a sanction-regime that countries like the US adopt to close off all doors of entry for tyranny. With Venezuela, it offers an unnecessary opportunity for the
government to relieve itself of all responsibility and vociferously hold American intrusion as the sole culprit. Maduro continues to rule unhindered as before. There can be no denial of the fact that these sanctions have evidently cut off a significant part of the money that Venezuela received from crude oil exports since the US is one of its largest takers. The ailing production was further impacted by this.
It will take great economic restructuring to correct the errors that had virtually been planted right from Chavez’s era. But, the authoritarian rule that Maduro sets out to seal, now that the result of this month’s controversial election has been called in his favour, poses a blot of doubt. The budget deficit, debts, and problems in the production of crude oil are all pronouncing the need to act in urgency. These should be dealt with if the country is to leap out of the murky depths it is in now.