- by Graham Holton
- The Guardian
- Issue #2110
Photo: Jeso Carneiro – flickr.com (CC BY-NC 2.0)
Nicolás Maduro is the declared winner of Venezuela’s presidential election, winning a third term. It is also a win for the ‘Bolivarian Revolution.’ The head of the National Electoral Council, Elvis Amoroso, said Maduro had over 51.2 per cent of the vote, beating the opposition candidate, Edmundo González, who has 44 per cent. The opposition has rejected the electoral ruling and called on the military to intervene. US Secretary of State, Antony Blinken, said he had “serious concerns” over the election results. Maduro said the extreme right has for 20 years been calling “fraud” each time it loses. Maduro praised the more than 900 election observers who monitored the election, ensuring it was fair.
Venezuela has suffered from years of US sanctions that have destroyed its once thriving economy, beginning in 2005, by the George W Bush administration. The Trump Administration expanded them to include financial and sectoral sanctions. In August 2017, President Trump issued an Executive Order prohibiting Venezuela’s access to US financial markets, including the state energy company, Petróleos de Venezuela, SA (PdVSA).
In 2017, Russia restructured more than US$3 billion in sovereign debt to aid the country. In 2021 China lent Venezuela US$70 billion for development projects in exchange for oil shipments.
As a result of crippling sanctions, hyperinflation reached 400,000 per cent per annum in 2019, resulting in an economic and humanitarian crisis that forced 7.7 million Venezuelans to flee to other countries. In 2022, the British government seized Venezuela’s gold reserves, worth €930 million (AU$1.54 billion), held in the Bank of England. Maduro’s legal team tried to get the 31 tonnes of gold released to finance Venezuela’s response to the pandemic and bolster the health system. The claim was rejected.
In October 2023 the US government granted Venezuela relief from sanctions on its state-run oil, gas and mining sectors after it agreed to hold a free and competitive presidential election. In April 2024 the Biden administration reimposed bans on PdVSA, from selling crude oil to the US, citing election delays. Sanctions hit Venezuela hard, with oil production down to 900,000 barrels of crude a day, compared to 3 million barrels a day in 1998, under Hugo Chávez. US corporations investing in Venezuela were given 45 days to wind down their operations.
Maduro’s victory continues 25-years of President Hugo Chávez’s “Bolivarian Revolution.” In 1999, Chávez founded the United Socialist Party of Venezuela (PSUV). Chavismo promised the nationalisation of oil assets, social welfare programs, accepted private and social property, and opposed the IMF (International Monetary Fund) and the World Bank. In 2006 Chávez promised to build 150,000 houses. In 2007, he proposed to build a communal state, with self-governing institutions such as communal councils, communes, and communal cities.
Chávez formed a major trade relationship with Cuba. The bilateral relation includes development aid, joint business ventures, large financial transactions, exchange of energy resources in exchange for Cuban doctors, information technology, and cooperation in intelligence service and their militaries. Russia has sold US$11.4 billion in military equipment and armaments to Venezuela, and China has sold US$615 million in weapons to Venezuela over the past 20 years.
For a time, Venezuela lent more money to Latin America than the IMF, promising to liberate Latin American from the Monroe Doctrine, which treats South America as the USA’s ‘backyard.’ Strong ties with Cuba and Bolivia’s Evo Morales threatened US regional control. When the price of oil was US$110 a barrel, PdVSA was able to fund social spending on housing, healthcare and transport. When oil dropped to only US$35 a barrel Venezuela was in a tight financial situation. Today Venezuela owes US$150 billion to bondholders and foreign creditors, and has been in partial default since 2017.
Any interference by the US government will meet a politically complex situation. Russia and China’s navies recently visited Venezuela in a show of support for Maduro. Trade with China stands at US$10 billion per annum, with Venezuela now the largest recipient of Chinese investments in Latin America. Cuba, Iran, and Turkey have provided financial, diplomatic, and intelligence support to the Maduro government. The long-standing territorial dispute between Venezuela and Guyana, which is supported by Britain, over oil reserves found in the Orinoco basin, remains a major unresolved issue.
The US State Department is clearly unhappy with the election results and will claim corruption and illegality by the Maduro government. With US elections only months away, the US State Department will need to look tough. The Biden administration will increase sanctions in an attempt to further destroy the Venezuelan economy. The US can expect a lot more pushback if it tries ‘gunboat diplomacy’ with Venezuela again.
Communist Party of Australia President,Vinnie Molina has said “The CPA welcomes the reelection of President Nicolas Maduro in the 28th July Venezuelan election.
The main enemy, US imperialism and the opposition it backs, seems to have been defeated. It is now time to call for unity to rebuild the economy in the best interest of the Venezuelan working class and people in general.
