Back in April, Brazil’s Folha de SaoPaulo ran an article entitled: “The Future of Venezuela Depends on China“ and highlighted this quote: Translation: “If Maduzo wins, he’ll have to regain the confidence of the Chinese.” TOM O’DONNELL, petroleum consultant
Indeed, it is now clear that the short-term strategy of the post-Chavez Maduro-Cabello administration was to escape the country’s severe dollar crisis by convincing Beijing to extend it a $5 billion cash loan alleviating food-import shortages before 8 December elections. In particular, the cash was to fund a new dollar exchange system (see El Nacional,25 Sept 2013). Continue reading
Posted in Chavez lagacy, Chavez legacy, China, Faja of the Orinoco, heavy oil, Hugo Chávez, Latin America and Caribbean, PDVSA, Uncategorized, Venezuela diplomacy, Venezuela oil, Venezuela update, Venezuelan elections
Tagged Beijing, Caracas, China, Hugo Chávez, Maduro, Nicolás Maduro, PDVSA, Venezuela
I’m invited to deliver a public lecture Wednesday, 24 April, at 3:30 in New York City at The New School University‘s Graduate International Affairs. This will be a critical examination of the legacy of Hugo Chavez’ “oil socialism” as an “alternative developmental model” for Latin America. Continue reading
Posted in Chavez, Chavez lagacy, Chavez legacy, Chavezsuccession cancer, China, Faja of the Orinoco, heavy oil, Henry Capriles, Hugo Chávez, Institutions and rule of law, international relations, PDVSA, PDVSA weakness, Venezuela update, Venezuelan Democracy, Venezuelan elections, Venezuelan weak institutions
Tagged Hugo Chávez, Latin America, New York City, The New School, Venezuela
The Supreme Court of Venezuela has just made a rather strange decision. Rather than deciding between the two possible scenarios described in the constitution for the case when a president-elect is unable to take the oath of office on the prescribed day of 10 January, they have instead pronounced a third scenario proposed by leaders of Chavez’ party: There is “no temporary absence” of Chavez, and there is “administrative continuity” (i.e., that there is no new administration since he was the previous president).
The decision by the TSJ [press conference 9Jan 2012] seems particularly amazing as it rejects the constitutional option of declaring Chavez “temporarily absent” that would have kept Chavismo in the presidency without an election for 180 days.
This decision is just as transparently un-constitutional and invented as the rationals of the right-wing Honduran military and congress in 2009 for throwing the president out of their country in his pajamas, rather than pressing whatever grievances or charges they had against him within the framework of the constitution. There is a habit growing in Latin America of “democracies” being unwilling to fight out political crises within the sphere of the constitution and the nation’s institutions.
Here’s the situation in Venezuela: The vice-president and acting president, Continue reading
A succession crisis is stalking Venezuelan society. President Chavez of Venezuela is again in Havana, after a complex six-hour surgery, his third in a year for an unspecified form of cancer. Just before the surgery, he returned to Caracas to address the nation. For the first time he spoke about what he wishes to be done if he is unable to return to the presidency. Continue reading
Leopoldo López, former Mayor of Chacao, Caracas
(Note: this post was expanded and some corrections made 23 Sept. Also, Part B will treat the “oil angle” – what are the policies of opposition candidates H. Capriles, P. Pérez and L. López as compared to the Chavista policies on PDVSA and on spending the nations’ oil income?)
This past week, the Inter-American Court of Human Rights overturned the administrative disqualification (inhabilitación) of Venezuelan opposition politician Leopoldo López from running as an electoral candidate. (see: decision of the Corte Interamericana de Derechos Humanos, and press release from Lopez’ organization. )
What might be the effect on the October 2012 election? In polls till now, Lopez has run third behind top-runner Henry Capriles, his former political ally and governor of Miranda State, and behind Pablo Pérez, the governor of Zulia State. The Chávez administration has been actively shaping who may run for the opposition ever since President Chavez’ first electoral loss, in the December 2007 plebiscite. This decision is clearly a setback for this policy.
Posted in Chavez, corruption, Henry Capriles, Hugo Chávez, Human Rights, Institutions and rule of law, Leopoldo López, Maracaibo, PDVSA, Uncategorized, Venezuela update, Venezuelan Democracy, Venezuelan elections, Zulia
Tagged American Convention on Human Rights, Government, Henrique Capriles Radonski, Hugo Chávez, Human rights, Human Rights and Liberties, Inter-American Court of Human Rights, Leopoldo López, Manuel Rosales, Miranda (state), Petróleos de Venezuela, United States, Venezuela, Zulia
First, here is an outline of this and the next three or four blogs on this topic:
I. Changes on the Venezuelan side that are enhancing the Chinese role:
a. Chavez’ recent interest in increasing national oil production
b. The existential crisis Chavismo faces from the slow collapse of dysfunctional state institutions, civil infrastructure, and nationalized enterprises
II. Changes on China’s side that enhance its role in Venezuela:
a. China has now loaned Venezuela so much money, and Venezuela so badly needs continued Chinese financing (lately it also feels a need for managerial and technical assistance), that Beijing has been able to insist Caracas not only begin to come through on long-awaited heavy-oil contracts, but that it also comply with certain geo-political and fiscal-accountability conditions. A couple of these are pretty amazing.
I. Changes on the Venezuelan side enhancing the Chinese role: a. Chavez’ new interest in increasing national oil production
One reason for China’s deepening influence in Venezuela is that PDVSA‘s president and energy minister, Rafael Ramirez, is no longer alone in insisting that PDVSA’s level of production has to rise. President Chavez now seems to have gotten behind the need to increase national production. If the price of oil falls significantly (many feel six months at an average of $60/barrel would be ruinous) and PDVSA’s exports per day have not risen to compensate, Venezuela will be in real trouble. Venezuela is extraordinarily dependent on imported goods, from food to machinery for which dollars are needed; and it also must keep up payments to foreign bond holders, for which a steady stream of dollars are also needed. Chavez and Ramirez have every reason to expect that the world’s economic woes will lead to a decrease in oil demand over the next year or two, and this of course can lead to significantly lower prices. These fears were not apparent in the recent past. It has been more or less a tenent of Chavista faith at elite-and-professional levels that the price of oil will never again fall significantly. I have been told this many times. Continue reading
Posted in Chavez, China, corruption, Economic Crisis, Faja of the Orinoco, heavy oil, international relations, PDVSA, Resource conflicts, The USA, Venezuela diplomacy, Venezuela update
Tagged Bolivarianism, Caracas, Chavismo, China, Energy, Eni, Heavy crude oil, Hugo Chávez, La Campiña, peak oil, Petróleos de Venezuela, Rafael Ramírez, States of Venezuela, United States, Venezuela
Major Chinese Faja heavy-oil-production contracts had not materialized till now. Why not?
(This is continued from Part I) On the one hand, technical reasons would be given against closing deals with the Chinese. For example, it was thought by some in PDVSA that Chinese companies lacked the technology to efficiently implement the refineries needed to upgrade Venezuela‘s extra-heavy oil to a grade light enough to enable it to be accepted by foreign refineries. On this excuse, some top PDVSA executives had pressed Chinese firms to focus on making joint proposals together with, say, Total of France. This was because Total had already proven the quality of its upgrader-refinery technology in one of the four proof-of-principle projects foreign companies had implemented during the previous government’s apertura period. (The apertura was the liberal “opening” of the oil sector to significant Continue reading
Posted in Chavez, China, corruption, Economic Crisis, Faja of the Orinoco, heavy oil, Institutions and rule of law, international relations, PDVSA, Resource conflicts, The USA, Venezuela diplomacy, Venezuela update
Tagged Chavismo, China, Heavy crude oil, Hugo Chávez, Petróleos de Venezuela, States of Venezuela, United States, Venezuela
In my travels and interviews in Venezuela this summer, it became clear that there has been a major advance in the relationship between China and the Bolivarian administration of President Chavez. China’s dogged persistence and large state-sponsored investments in Venezuela – apparently the largest they’ve made to date in any country - are finally beginning to bear fruit. The new Chinese influence is being simultaneously extended to both oil and non-oil sectors.
Partly this development is due to the many crises affecting the Bolivarian state, and decisions it has been forced to take to make increasing national oil production a priority. To advance this program, President Chavez’ administration has made initial moves to grant Beijing access to Venezuelan oil in major ways it had not previously.
However, there are two sides to this story: on the other side, increasing Chinese participation is also a product of China having step-by-step put some quite sharp demands on PDVSA and the Venezuelan Bolivarian state for financial transparency and accountability, for geopolitical stabilization, and in particular, for Chinese firms being granted large-scale access to new heavy-oil fields in the Faja of the Orinoco River. The key ingredient here is that Continue reading
Posted in China, Economic Crisis, Oil subsidies, Resource conflicts, The USA, Uncategorized, Venezuela update
Tagged Beijing, Bolivarianism, China, Heavy crude oil, Orinoco, PDVSA, People's Republic of China, Petróleos de Venezuela, Saudi Arabia, States of Venezuela, United States, Venezuela
Why did President Chavez last week order that Venezuela‘s gold reserves held abroad be repatriated and that international reserve funds held in banks in the U.S., Switzerland, Britain–the global north–be moved to banks in Brazil, Russia and China–to BRIC countries? The move is being hailed by Chavistas; but, the generalized anti-imperialist and nationalist rationals being cited are not useful as far as a specific geopolitical analysis. That is , they do not explain why this takes place right now as opposed to having been done at any given time during the last 12 years of his presidency.
So, why is this being done now? The idea is obviously to keep these funds in places where they cannot be seized or frozen. But, WHAT might trigger seizures or freezing of these funds NOW as they lay in U.S., British or Swiss banks? Continue reading
Posted in Chavez, Economic Crisis, Gaddafi, Libya, Venezuela update
Tagged BRIC, ConocoPhillips, Hugo Chávez, Libya, PDVSA, Petróleos de Venezuela, United States, Venezuela