Venezuela: The Region Feels the Impact

This commentary is part of our Watch List 2018 – First Update.

International efforts to broker a solution to Venezuela’s implosion so far have not borne fruit. The crisis is spilling across Venezuela’s borders, with some 1.5 million Venezuelans fleeing the country over the past year and a half. Venezuelan President Nicolás Maduro’s government is unable or unwilling to reverse the economic and social collapse brought on by its misguided policies. It frustrated the last round of talks between it and opposition representatives by unexpectedly calling an early presidential election, even as those negotiators discussed reforms to help level the playing field. That vote, now scheduled for 20 May, is more likely to aggravate than resolve the crisis, as the EU’s April declaration on the situation in Venezuela identified. Most opposition leaders call for a boycott, arguing that Maduro’s re-election is predetermined. Latin American governments in the ad hoc Lima Group, as well as those of the United States, Canada and Spain, have declared they will not recognise the result should the elections proceed as planned. The European Parliament endorsed the same stance in a resolution adopted at the start of May.

The EU, U.S. and other Western governments have imposed targeted sanctions on dozens of government officials, including the president and vice president. The U.S. has also banned most loans to Venezuela and is considering some form of oil embargo. A solution to the crisis can only come through a negotiated transition, which will require new talks between the government and opposition and additional pressure on the government. Ideally, Lima Group members would use the threat of their own targeted sanctions – such sanctions from Latin American governments would be almost unprecedented – to help push the government back to the negotiating table. To contribute to such a strategy, the EU and its member states, should:

• Agree with Lima Group governments and the U.S. on clearly delineated steps the government should take to have Western sanctions lifted and avert Latin American sanctions.
   
• Caution against the oil embargo floated by the U.S. and called for by some opposition hardliners, which would worsen the humanitarian emergency.
   
• Encourage China, during engagements with Chinese officials, to help nudge Maduro to accept talks.

At the same time, efforts to contain the humanitarian crisis should continue. To this end, the EU and its member states should:

• Reinforce their support for migrants and refugees along Venezuela’s borders.
   
• Continue to seek out opportunities for delivering aid inside the country.

Particularly for the latter efforts, the EU will need to maintain a strict separation between the provision of humanitarian assistance and political demands on the government.

Humanitarian Emergency

Venezuela is sinking ever deeper into a profound economic and social crisis. Annual inflation could reach upwards of 300,000 per cent by year’s end. Despite a government plan to strike three zeroes off Venezuela’s currency, cash is almost impossible to obtain, hitting the poor, many of whom have no other means of payment, particularly hard. Over eight million Venezuelans cannot afford three meals a day. Protein has disappeared from many of their diets. Essential medicines are lacking: for some such medicines only 20 per cent of the quantity needed is available; others have entirely run out. Many of those suffering chronic diseases like cancer, HIV/AIDS or haemophilia are dying for lack of treatment.

Most public hospitals cannot guarantee running water or working lifts, let alone equipment such as X-ray machines. Patients are forced to provide their own medical and surgical supplies. Many operations are cancelled because blood banks lack reagents to ensure transfusions are safe. Long-controlled diseases like measles and diphtheria are making a comeback. Parts of the country are in the throes of a malaria epidemic. Yet the Venezuelan government denies the humanitarian crisis exists, portraying any coverage of the crisis as misinformation designed to undermine its rule. It also rejects much humanitarian aid, arguing that such efforts are part of a foreign plot to oust it.

As many as 1.5 million people have left the country in the past eighteen months, and a similar number may leave in the course of this year. The exodus has placed public services in neighbouring countries under strain, with governments in countries as far away as Chile having to adapt immigration regulations accordingly. Temporary shelters and soup kitchens catering to Venezuelans have been set up in Colombian and Brazilian border towns. UN agencies and the EU are now beginning to provide international aid in those locations.

Political Deadlock

A presidential election is scheduled for 20 May, but is unlikely to provide a way out of the crisis. In February, the government brought forward the election by more than six months, thus sabotaging internationally facilitated talks with the opposition over electoral reforms that were underway at the time. Most opposition parties are boycotting the poll, but beyond that do not offer a coherent strategy for pressuring the government.

Former state Governor Henri Falcón of the Avanzada Progresista party, with the backing of two other small parties, is contesting the presidency. To do so, he has broken with the Democratic Unity (MUD) opposition coalition, which includes most of the more moderate opposition parties that had been negotiating with the government and are now planning to boycott the polls. The opposition’s harder-line wing, now represented by the Soy Venezuela movement, is calling for a “humanitarian intervention” – for the U.S. to intervene militarily, in other words – and for President Maduro to be impeached and tried for crimes against humanity. On 17 April, parliament, in which opposition politicians, mostly from parties in the MUD, hold a majority, voted overwhelmingly to approve Maduro’s trial for corruption by an ad hoc “Supreme Court in exile” – composed of judges appointed to the Supreme Court by the parliament and later forced into exile. But this initiative will have little practical effect. Parliament has been rendered largely powerless, especially after a new Constituent Assembly, dominated by ruling party loyalists, was elected last year in a vote the opposition also shunned.

Polls indicate that most opposition voters will abstain on 20 May, offering Maduro a clear chance of victory despite popularity ratings below 30 per cent. Even if Falcón were to win, the government’s control of electoral authorities, the Supreme Court – which has the final word on electoral disputes – and the security forces means it would have the power to block his victory. The absence of credible international observer organisations, which declined to deploy observers given the conditions in which the vote is being held, also gives Maduro a free hand.

Dozens of military officers, including commanders of key units such as the armoured Ayala battalion in Caracas, have been detained for allegedly plotting against the government. Their arrests lend credence to widespread accounts of unrest in the barracks. With the exception of a minority of mostly top military leaders, who are accused of benefiting from corruption and other criminal activities, members of the armed forces suffer the same deterioration in living standards as other Venezuelans. Military canteens often provide little or nothing to eat. That said, a coup attempt, while impossible to rule out, would be hard to pull off: the armed forces are fractured and extensively penetrated by counter-intelligence.

International Reaction

Venezuela’s international isolation has intensified markedly over the past year, with regional governments in particular turning their back on Maduro, especially after the breakdown of talks in February. Further sanctions are likely unless the president postpones the vote and takes measures to level the playing field. That said, exactly how the threat by Latin American and other governments to “not recognise the results” would be put into practice is unclear. Many governments already have withdrawn ambassadors from Caracas. But entirely severing diplomatic relations could reinforce the government’s siege mentality and backfire.

The Lima Group issued a fresh statement at the mid-April Summit of the Americas, which the summit’s host, Peru, barred Venezuela from attending. That statement called for free and fair elections and the restoration of democracy. The group also emphasised the need for humanitarian assistance, both within Venezuela and in neighbouring countries hosting Venezuelans that have left. Meanwhile, France, Germany, Italy, Spain and the UK, together with several Latin American governments, Canada, Japan and the U.S., have backed a joint initiative to locate and seize those assets of Venezuelan officials that they have reason to suspect have been acquired through corruption.

Recommendations to the European Union and its Member States

Venezuela’s crisis is now a grave threat not only for its own people, but also for the wider region. A lasting solution requires a negotiated transition. It also requires comprehensive economic reform, which can only be carried out by a government that enjoys international political and financial support. The starting point must be a return to negotiations between the government and opposition leaders.

Thus far, the threat of economic collapse has not persuaded the group around Maduro to participate in such talks, which would, in essence, be aimed at negotiating the end of one-party rule and the restoration of democracy. Top officials perceive potential exit costs as extremely high, and fear they would risk prosecution for alleged corruption, drug trafficking and human rights violations were they to lose power. For its part, the opposition is split into three main factions, each frequently adopting tactics that contradict those of the other two. Calls for military intervention by the harder-line Soy Venezuela faction are particularly counterproductive, fuelling the government’s accusations that humanitarian aid is a foreign plot.

With no political solution in sight, the EU and its member states should continue and expand their critical humanitarian assistance along the lines described by the European commissioner for humanitarian aid and crisis management after a visit in March to the Venezuela-Colombia border area. Their efforts should include helping neighbouring countries cope with the burden on welfare services due to unprecedented migrant and refugee flows. The EU shall continue providing assistance to those affected and seek additional ways to deliver support to the population, which requires working around the government’s refusal to acknowledge the crisis, particularly by clearly separating political from humanitarian demands on the government, while strengthening Venezuelan civil society groups and foreign non-governmental organisations able to deliver food and medical aid to vulnerable populations. The EU and its members also should use their influence in multilateral bodies, including the UN, to ensure those bodies do all they can to alleviate suffering, including ensuring adequate funding and providing accurate information on humanitarian conditions in Venezuela.

To encourage a negotiated solution to the crisis, the EU and its member states should work closely with the Lima Group, the U.S. and other concerned governments to present a united front. All should coordinate their sanctions policy and diplomatic initiatives designed to bring about negotiations. This means agreeing on a set of measures that the government would have to take to have those Western sanctions that already exist lifted and avoid further sanctions, including from Latin American governments. The EU and its member states, however, should argue against wide-ranging economic sanctions, including an oil embargo. If the elections take place on 20 May, EU member states could use the opportunity presented by the 28 foreign ministers’ meeting scheduled shortly thereafter to coordinate their response.

A clear list of demands would allow sanctions against individuals, like those the EU introduced against seven top officials in January, to be gradually lifted if the government moves in the right direction. The EU should continue using its existing channels with the opposition to encourage them to unite around a credible strategy.

China, which thus far has played an important role propping up the Maduro government but shows some signs of tiring of its economic mismanagement, could contribute to a solution. The EU, together with Western and Latin American governments, should advise Chinese officials of the importance of nudging Maduro to accept talks, and thereby promote a stable and prosperous Venezuela. China also should participate in plans for a major economic and financial rescue package in the event of a transition agreement.