Tag Archives: Venezuela

Security Advisory: Venezuela (17 May 2016)

Executive Summary

President Nicolas Maduro has called a constitutional state of emergency in Venezuela in the face of the country’s severe economic crisis and ongoing social and political protests. MS Risk is closely monitoring the situation on the ground and has consultants in place to provide emergency evacuation services or security risk advice to travellers and personnel should the situation further deteriorate.

Situation

During the weekend May 15-16 significant demonstrations rocked the capital Caracas, as anti-government demonstrators clashed with the police and pro-government supporters. The opposition are calling for a referendum to challenge Maduro’s presidency in the face of the spiralling economic crisis. Demonstrations are likely to continue in Caracas and other cities throughout the country and intensify in the coming weeks. Maduro has called on the army to prepare for a major exercise to “safeguard” the country from foreign invaders and a potential coup. Maduro has systematically claimed that right-wing groups supported by the US, and former Colombian president Alvaro Uribe, are driving the civil unrest and attempting to carry out a coup. The highly sensitive relationship between the US and Venezuela is likely to ensure that the US will not intervene in the crisis, but push for a regional response.

Security Advisory

MS Risk strongly advises against all non-essential travel to Venezuela at this time.

The opposition are likely to call for peaceful protests in the coming days to maintain pressure on the government to allow a referendum to depose Maduro and trigger presidential elections. There has been speculation that the military generals could carry out a coup, but MS Risk’s sources on the ground have not seen any significant activity to suggest that the army generals are likely to desert the president at this current time. However, Maduro’s hold on power is increasingly at risk as dissident factions within his own party are starting to turn against him in the face of the crippling economic crisis and widespread medical and food shortages. By calling a state of emergency he is likely to use the military to attempt to regain control in the coming weeks, and seize private assets to prop up the flailing economy.

There is a high likelihood of violent protests breaking out across major cities in the coming weeks and MS Risk advises all travellers to be highly vigilant and avoid demonstrations wherever possible. The political and economic meltdown have reached a crisis point and protesters are increasingly angry. Should the military and police respond with heavy handed tactics, violence is likely to break out. This is particularly worrisome given the dire situation of the country’s hospitals and lack of ambulance and paramedic supplies.

MS Risk strongly advises travellers in Venezuela to avoid engaging in political discussions in public in the highly polarised current environment. We advise not to wear any colours or items that could be misconstrued by the crowds as being partisan, eg red items of clothing, or khaki military looking attire.

There are widespread shortages of medicine on the open market and most pharmacies are empty. Hospitals and clinics are facing a serious public health crisis. The economic crisis has resulted in a major public health issue across the country with hospitals struggling to provide basic medicines such as antibiotics, intravenous solutions and sanitation products (soap, gloves, disinfectants). Alongside this, constant water shortages and blackouts have seen a significant uptick in preventable deaths. In January 2016 the opposition in Congress declared a state of humanitarian emergency and passed a law to allow international aid to prop up the health system. President Maduro rejected the effort as an attempt to privatise the hospital system. Protesters are now calling for the international community to intervene.

MS Risk advises travellers to Venezuela to bring their own emergency medical supplies and sanitary provisions (shampoo, soap, deodorant, toilet paper, etc). It should be highlighted that it is extremely difficult to purchase baby milk and diapers on the open market and MS Risk notes the high risk to travellers or expatriates that may fall ill. The crisis in the hospital and current widespread shortages and power shortages significantly limit the capacity of x-ray machines, oxygen tanks and other respiratory machines. Any traveller to Venezuela must make contingency plans on how to access medical attention should they fall ill, or plans for an emergency evacuation.

There are widespread food shortages, with many shops completely bare and long queues for basic provisions. Looting has become commonplace and violent scuffles regularly occur in the fight to gain basic food supplies. Numerous factories have stopped producing in recent weeks because of the shortages of key ingredients entering the country and constant energy shortages. The government has claimed in the current state of emergency it will seize private factories by force to make them produce basic provisions.

There are rolling blackouts throughout the country, including in Caracas. Schools are officially closed on Fridays and government workers are operating a two-day week in the face of constant energy shortages. Any travellers to Venezuela should be aware that internet access may be severely limited during power outages, and should not depend on electronic devices to navigate the city or make travel plans. It is advisable to map out your daily travel routes and to prepare for limited cell phone coverage and internet access, particularly if significant civil unrest breaks out and the networks are brought down.

The economy is in a state of freefall with the IMF predicting inflation at 700% this year. Venezuela has the world’s largest oil reserves, but its economy retracted 5.7% last year and is predicted to further retract 8% this year, sharply affected by the falling oil prices. The government has so far managed to not default on its debt by significantly cutting costs that have exacerbated the aforementioned food and medical shortages. However, it is increasingly likely that the Venezuelan oil firm PDVSA will default on its $5bn bond payments between now and the end of the year, further shaking confidence in the economy’s ability to rally. The country has drained its foreign reserves, and despite hyperinflation cannot print money quick enough to pay the current debts.

Private companies face a significant risk of non-payment on government contracts. Numerous airline carriers have cut their services to Venezuela since 2014 because of rising insecurity and the government’s inability to pay many contracts. In the oil services sector, providers such as Halliburton and Schlumberger have scaled back their operations because they are owed hundreds of millions of dollars in government contracts. In the current state of emergency that is likely to extend into July, private companies’ assets are at risk as the government will look to nationalise companies to prop up the economy.

Venezuela has some of the highest rates of violence crime in the world, with Caracas registering one of the highest homicide rates in the world in 2015. MS Risk advises travellers to be particularly aware of the dangerous on the road between the Simon Bolivar Airport and Caracas, where regular violent muggings and attacks are reported, often by criminals posing as taxi drivers. MS Risk strongly advises travellers not to use any street taxis or public transport, and to use official drivers with secure vehicles to navigate in the city, particularly in the current climate of widespread roadblocks amid demonstrations.

Major Incidents (1 – 15 May 2016)

15 May         Venezuela will hold national military exercises to prepare the country for “any scenario”, President Nicolas Maduro said. On Friday, Maduro extended the economic state of emergency in the country for three more months.

 14 May         Venezuelan President Nicolas Maduro declared a 60-day state of emergency on Friday due to what he called plots from within the country and from the US to topple his leftist government. Maduro did not provide details of the measure. A previous state of emergency, implemented in states near the Colombian border last year, suspended constitutional guarantees in those areas, except for guarantees relating to human rights.

The Venezuelan government has imposed a ban on protests in the capital Caracas over concerns that they could lead to deadly clashes between supporters and opponents of President Nicolas Maduro. The decision comes as the opposition is pressing ahead with a drive to remove Maduro from power through a referendum.

13 May         Venezuela’s Attorney General on Wednesday charged nearly a dozen people, including an Interpol official and five national guards in connection with a shipment of drugs seized in the Dominican Republic in March. Prosecutors charged the men with drug trafficking and conspiracy.

11 May         Soldiers and police officers fired tear gas at protesters on Wednesday as Venezuela’s opposition marched to pressure electoral authorities into allowing a recall referendum against leftist President Nicolas Maduro. Hundreds marched in the capital of Caracas as well as the provinces but authorities blocked them. The Democratic Unity coalition has ramped up its push to oust Maduro amid a worsening economic crisis, but says the government-leaning electoral body is intentionally delaying the verification of signatures in favour of the referendum.

 Nine members of a criminal gang were killed during a crackdown by security forces on crime around the capital of Venezuela. Authorities seized rifles and grenades during the raids. Officers also arrested 15 other suspects wanted by the courts for homicide, drug trafficking and robbery. They also detained 80 Colombians who were in the country illegally.

7 May          The leader of a Venezuelan opposition party in the north-western state of Lara was shot dead by unidentified attackers on Friday. The victim was German Mavares, the state head of the New Time party. It is difficult to establish whether the killing was politically motivated or random violence in a country with one of the world’s highest murder rates.

 Venezuela’s National Guard killed a notorious paramilitary chief during a military ambush in the rural state of Guarico. Jose Tovar Colina was the leader of Los Picures gang, a paramilitary group involved in a series of hired killings, kidnappings and vehicle hijackings. Three other alleged members of Los Pictures gang were also killed in the shoot-out.

4 May          Venezuelan officials say the country’s most wanted gang leader has been killed in a shootout with police. Interior Minister Gustavo Gonzalez identified Jose Colina as the leader of a gang that dominated several states in the center of Venezuela.

2 May          Venezuelan opposition has delivered Monday more than 1.85 million signatures to the National Electoral Board for verification as part of a petition to launch the first stage for a referendum on removing President Nicolas Maduro. If the electoral board accepts the signatures as valid the opposition will then have to collect four million more for the board to organize the vote.

The VII Summit of the Americas

On April 10-11 in Panama City, Panama, the Heads of State and Government of the Americas were gathered for the Seventh Summit of the Americas. This year the Summit was especially important as it saw the historic presence of Cuba whose President Raul Castro addressed his counterparts and held face to face talks with Barack Obama, the first Cuban leader to do so since the its expulsion from the Organization of American States in 1962 imposed by the United States.

Regional leaders have widely hailed it as a victory for left-leaning and progressive forces in the region, and particularly Venezuela and Cuba. Several issues were highlighted during the Summit such as Cuban-US relations, energy solutions, climate change, peace in Colombia, Venezuelan-US relations and Argentina’s long-standing claim of sovereignty over the Falkland Islands. During the summit, President Obama met with President Raul Castro and both said that their meeting will help their countries turn the page after decades of important hostility. It is likely that both countries will still have differences but they will advance mutual interests. President Obama said: “What we have both concluded is that we can disagree with a spirit of respect and civility. Over time, it is possible for us to turn the page and develop a new relationship between our two countries.” President Castro has called for the lifting of the US economic blockade on Cuba and the country’s removal from Washington’s list of state sponsors of terrorism. However, for the US human right in Cuba and political reform are key issues. President Obama is expected to remove Cuba from the terrorism list in the coming days, which would further demonstrate US’s commitment to improving its ties with Cuba.

However, the much anticipated rapprochement between the US and Cuba was quite upstaged by regional leaders’ rejection of President Obama’s March 9 Executive Order that labelled Venezuela a “national security threat”, which has been condemned by 33 nations and other regional bodies. While positively noting the steps taken by President Obama to re-establish bilateral ties with Cuba, President Castro nonetheless criticized President Obama for his aggressive measures against Venezuela. The US also imposed sanctions on 7 Venezuelan top officials last month it accuses of human rights violations. A potentially tense moment of the Summit was avoided when President Maduro did not follow through on a pre-summit pledge to confront President Obama with 10 million signatures on a petition demanding the removal of the sanctions. Instead, President Maduro said the petitions would be delivered through diplomatic channels. This change of the initial strategy came after a senior US State Department official flew to Caracas to meet with Maduro, and Obama and other top officials walked back language declaring Venezuela’s political and economical instability a threat to US national security.

During the plenary sessions of the Summit, Venezuela was supported by other nations such as the presidents of Latin America’s two most populous and economically powerful nations: Brazil with President Rousseff, who only briefly criticized the US sanctions on Venezuelans as “counterproductive and inefficient”, and Mexico with President Enrique Peña Nieto, who delivered an attack-free address to the assembly. This support from other regional leaders is also characterized by their global desire of a lesser US intervention in the region and especially on political or military aspects. Bolivian President Evo Morales expressed this by saying: “We don’t want more Monroes in our continent, nor more Truman doctrine, nor more Reagan doctrine, nor more Bush doctrine. We don’t want any more presidential decrees nor more executive orders declaring us threats to their country.”

The pressure put on the United States by regional leaders on several matters is escalating and it is highly likely that this will continue in a short- to mid-term period until US intervention in internal matters does not stop. However, both the meetings between the US with Cuba and with Venezuela demonstrated that improvements in their relations are possible and that steps in order to move forward will be taken by all sides. The Summit concluded with a Declaration from President Varela delivered at the end of the event. In his speech, the Panamanian president said he convened the summit “with a universal character” and that the result was a “historic” event, through the presence, for the first time, of Cuba. He then added that “the decision announced by the presidents of Cuba and the United States to move forward with a new approach to the relations between their countries created a legitimate expectation that situations, both old and new, that have made for tense hemispheric relations can be resolved.”

The Venezuelan Economic, Political and Social Crisis

Despite significant social advances achieved under former President Chavez’ social policies, Venezuela is suffering from profound economic, political and social polarization. The implementation of economic policies in the past decade, namely the introduction of currency exchange controls, the declining productivity and nationalization have led to a steady deterioration of the country’s economy. The accumulation of foreign debt and the reduction of Central Bank reserves have led to critical inflation hitting 64% and shortages of goods that have weakened the on-going administration of President Nicolas Maduro. This context of economic crisis is contributing to heightened political and social tensions across the country. Furthermore, those tensions have been exacerbated by ideological differences and a political stalemate within the ruling party, the United Socialist Party of Venezuela on how to tackle the economic crisis.

The Venezuelan government’s increased control over democratic institutions and its campaign against the opposition provoked a deterioration of democracy, where notably the opposition has no recourse to the institutions established by the law, developing an environment of government impunity in both the political and economic spheres. In addition to this, former President Chavez’ reorganization of the military forces has brought their heightened involvement in civil matters and favoured the militarization of the Venezuelan society.

As Venezuela marked the 1-year anniversary of the death of Hugo Chavez in March 2014, the country suffered from widespread political violence following several weeks of anti-government demonstrations, protests and retaliations injuring hundreds of people and resulted in the deaths of more than 40 civilians. The crisis engendered numerous reactions from the international community. The European Union, the United Nations, the Interamerican Human Rights Commission and the International Socialist organization condemned the violence used by police and military forces, and condemned human rights violations.

The widespread insecurity, scarcity and shortage of goods and allegations of corruption among the government and military, associated with the repression of anti-government protests and political opponents and human rights violations in 2014, have contributed to the on-going explosive climate. Although the opposition has formed a coalition, it has not been able to propose a viable political alternative. By looking at recent events, there are signs of an increased tendency of a militarized response to the unrest and to turn to violence on several sides.

President Maduro launched an economic war against the bourgeoisie by intervening in some companies and imposing a decrease in the prices of household appliances sold at retail store chains. This initiative became a law by Presidential decree, and imposed a maximum of 30% to the earnings of businesses, and developed severe fines or imprisonment to those who do not comply. The establishment of this new mechanism has made scarcity of goods a systematic pattern of the everyday life of Venezuela nationals. Recently, President Maduro also ordered the takeover of a private supermarket chain called Dia a Dia by the state food agency. Other international companies based in Venezuela could possibly be targeted in the future. Currently, Venezuelans have to queue for hours outside supermarkets, leading to growing tensions since stocks are running lower than usual. Since the beginning of 2015, the situation has deteriorated even more as President Maduro was out of the country visiting several countries such as Russia, China and Opec nations to seek fresh money to shore up the Venezuelan economy and try to convince other oil producers to curtail production.

Massive violent protests are spreading across the country once more with groups of students setting up roadblocks and burning tyres. It is likely that violent demonstrations will continue over the next weeks, as President Maduro authorized on 1 February the use of deadly force for police and military forces against protesters if they feel their lives are in danger. Civil rights groups claim that theses regulations will bring the opposite result expected and added that: “they pose a direct threat to the working class.” Other human rights organizations believe that theses regulations are unconstitutional, as the Venezuelan Constitution expressly forbids the use of firearms to control public demonstrations. As 2015 started, dozens of protesters have already been arrested.

Lastly, on a geopolitical level, the critical situation of Venezuela is affecting the political map of the whole Latin American region by impacting not only the Community of Latin American and Caribbean States and other regional mechanisms, but also the domestic politics in several countries in the region. In December, the U.S Congress cleared and sent to President Obama legislation directing him to impose sanctions against Venezuelan government officials who were involved in a crackdown on anti-government protesters a few months ago. The U.S Senate also passed a bill on 15 December and the House approved the measure by voice vote. It authorized sanctions that will freeze the assets and ban visas of individuals accused of perpetrating acts of violence or violating the human rights of those opposing the Venezuelan government of Maduro. Venezuela’s foreign relations are complicated with numerous countries

Taking into account this complex situation where many drivers are involved, it is likely that if President Maduro’s administration fails to drive adequate economic policies, increases the repression of the opposition and the social outbreak continues unabated, the country could enter into a state of higher anarchy and escalating violence. Thus, it would result in a higher threat to both Venezuela and its neighbours’ domestic security.