Venezuela’s economic collapse took place years before international sanctions were imposed on the government of Nicolás Maduro, but it will be very difficult for Caracas to embark on the road to full recovery without their removal. And although some are betting on a political solution to defuse the Venezuelan crisis in transparent elections, everyone is aware that the country could remain for years — perhaps even decades — in the grip of sanctions that are seen as both a consequence and a cause.
Although, in the view of many, it is the pressure being applied by sanctions that has forced the government to dialogue with the opposition, their prolonged duration and their effects has caused a shift in public opinion. The echoes of a Venezuelan lobby are growing stronger in the corridors of U.S. power where a policy of flexibilization in the energy sector is being advanced. Representatives of Maduro and the U.S. State Department met in Qatar to exchange views on the matter. It is already common to hear businessmen, economists and moderate opposition leaders asking for their definitive repeal.
Today, the Venezuelan state is facing serious impediments in selling its oil; to establish economic agreements; to acquire spare parts; to contract services from American, Canadian or European companies; to access international credit and to use its frozen funds abroad. Caracas faces notorious complications in carrying out operations with banks in these countries. In many cases, overcompliance takes place, an administrative bias with which many companies harden their restrictive stance to protect themselves.
Venezuela’s economic and productive collapse fully surfaced in 2013, shortly after the death of Hugo Chávez. The United States, Canada, the European Union and, initially, some Latin American nations placed political, economic and administrative sanctions on Maduro’s government because of the harsh repression of opposition demonstrations in 2014 and 2017, which resulted in several dozens of deaths; for preventing the parliament, then controlled by the opposition, from legislating sovereignly; for undermining democracy in rigged electoral consultations, and over accusations of corruption, money laundering and human rights violations against members of the revolutionary leadership, which are now being investigated by the International Criminal Court.
According to calculations by the polling firm Datanalisis, 74% of the population no longer agree with the international sanctions against Venezuela, compared to 17% who do. Nearly 30% of the population blame the sanctions for the current situation. In particular, 76% expressed their interest in the removal of oil sanctions, in a nation with high indebtedness rates and low salaries. On the other hand, personal sanctions against certain officials are approved by 52% of Venezuelans.
Jorge Roig, former president of the employers’ association Fedecamaras, says that “in reality, sanctions are not designed to change governments, but to force a government to sit down and negotiate with the other party. This has been achieved in part in the Dominican Republic, Barbados, Norway, and Mexico. But there is no justification for sanctions on the nation. We need to produce. By concept, sanctions that restrict freedoms cannot be supported by economic groups; that has been the case historically.”
Maduro’s government spent years denying the existence of a humanitarian crisis, imposed strong censorship on the media, stopped publishing economic figures and blamed businessmen for the severe shortages of food and medicines that for five years affected the country after a strict regime of price controls and intervention in companies. Since 2019, on the other hand, international sanctions have been blamed for everything that happens in Venezuela.
“Most citizens are clear about the causes of the sanctions, and recognize that the government is to blame for what is happening,” says political analyst Luis Vicente León, director of Datanalisis. “The distancing with the sanctions comes from the fact that they have not fulfilled their objective and have exacerbated the problems of the people even more. Four years ago, the sanctions were viewed sympathetically by the majority of the population.”
“To suggest that the ceiling of Venezuela’s economic recovery is the sanctions is not a correct approach,” says opposition leader Leopoldo López, founder of the exiled Voluntad Popular party. “The ceiling of Venezuela’s recovery is Maduro’s dictatorship. The best example of this is this year’s PDVSA-Crypto corruption case, involving Tarek El Aissami, where $20 billion was lost in illicit dealings. At this moment, sanctions are the only option to aspire to elections with minimum guarantees.” López recognizes that it is necessary to separate state sanctions from individual sanctions on members of “the kleptocratic scheme of politicians, businessmen and beneficiaries of the regime.”
The process of the relaxation of sanctions could continue in the energy sector, but a real political solution still seems complex. “The country would need, at least, to resume its oil and gas industry, access international credit and recover the assets it has frozen abroad,” says León.
“Last year, Maduro was willing to negotiate, but the atmosphere has cooled down,” says economist Orlando Ochoa, who is closely involved in the negotiations. “The economy has serious problems and little income. Maduro is stagnating in the polls. In the PSUV [United Socialist Party of Venezuela] these issues are being debated. María Corina Machado, a hardliner, is leading in all polls. That would complicate things if there is no flexibility. There are no incentives that make Maduro think he can leave power; quite the contrary.”
Maduro’s government has managed to reduce its isolation in recent months, during which time there has been a small reactivation of international capital and services, some of which have been towed by the softening of Washington’s stance. Relations with domestic capital appear to have normalized. The number one condition set by Maduro’s administration for a political agreement is the immediate end of international sanctions against the country and its government.
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