Reasons for optimism in Venezuela

Reasons for optimism in Venezuela

With Hugo Chavez’s death, there are hopes that the excesses of Chavismo will be rolled back, as Venezuela needs to tackle its systemic economic problems.

It is easy to get lost in the romance of the Latin American world. To many it will always be a world of emotion and passion: of steamy soap operas, smooth Don Juans, and beautiful Miss Universes. In its darker variations, this is a world of fire and swords, revolution and populism. This is the land where Venezuela exists, and where the memories of Simon Bolivar and Hugo Chavez reign constantly. At least so the stereotype goes.

“You can cut all the flowers, but you cannot keep spring from coming.”
– Pablo Neruda

Much ink has been spilled on the myth of Hugo Chavez, a man whose fiery rhetoric and populist Chavismo kept him in power for well over a decade. Since his death some have been tempted to brush his successor, Nicolas Maduro, with the same stroke.

Maduro is a man who on the surface appears to fit quite nicely into Chavismo. From his humble beginnings as a Caracas bus driver, Maduro rose to become something akin to Chavez’s son. If one could permit such an analogy, he is what the “Venezuelan dream” should represent as a product of a system notionally designed to give power back to the people.

Throughout the recent election Maduro tried to play up these credentials, hoping to bank on his perceived populist appeal and Chavez’s messianic cult. His campaign slogan is quite emblematic of this: “Chavez sets the route, Maduro takes the wheel!” they said.

But Maduro is not Chavez. He is a man from the people, but not a man of the people. Though he may say the same things, he does not talk the same way. The recent election results, where Chavez’s 11-point victory over opposition leader Henrique Capriles was reduced to a disputed outcome, is symptomatic of this. Understanding this is fundamentally important in predicting the coming trajectory of the Venezuelan state.

Though Venezuela will continue to be able to export oil, slightly mitigating some of Chavez’s more disastrous economic policies, Maduro sits on a ticking time bomb. Inflation is sky high, moving past 30%. Murder rates are skyrocketing while foreign investment continues to plummet due to past expropriations. And with increased American energy independence the era of $100 oil may be coming to an end.

Chavez had both the ideological conviction and public support necessary to withstand pressures to liberalize and integrate the Venezuelan economy in the face of such terrible indicators. Yet given his weakened mandate, and the fractured political climate under which he operates, Maduro will not be able to withstand such pressures for long.

Already there have been signs that Venezuela is inching towards change, with Maduro going so far as to temporarily open a back-channel with the US State Department during Chavez’s cancer treatments. While it would be difficult to see an overnight reversal of US-Venezuelan relations, these subtle steps are more indicative of a pragmatist than an ideologue. This is cause for optimism, and may be the root of better ties with Venezuela’s biggest export market in the medium term.

In the short term, expect Venezuela to pursue its liberalization on a more regional basis. Importantly, Brazil very quickly recognized Maduro’s government in spite of the electoral controversies. Additionally, Brazil and Peru have shown that there is a viable “third way” through which Venezuela can integrate into the international system. States like these have contributed to the general decline in anti-American sentiment, and give Venezuela a workable model for change.

For all the fever and emotion associated with Latin America, the logic of Venezuela’s economic problems remains cold and calculating. Maduro is not the reincarnation of Chavez and attempts to analyze Venezuela’s future on its Chavismo past are superficial at best. In short, spring is coming.

Categories: Latin America, Politics

About Author

Sammy Halabi

Sammy has served as a Compliance Analyst with the G8/G20 Research Group at the University of Toronto. He is a specialist on the Balkans, visiting the region on a number of occasions and conducting independent research within Kosovo. Sammy holds an MSc in International Political Economy from the London School of Economics. He received an undergraduate Honours BA from the University of Toronto in Economics and International Relations with High Distinction. In his free time, Sammy is passionate about playing volleyball, travelling, and seeking out new experiences.