Crisis in Venezuela, what is happening and why President Maduro is at risk

A political and economic crisis in Venezuela is causing widespread discontent. A petition for a referendum to recall President Maduro has obtained 200,000 signatures.

The socio-economic crisis in Venezuela

A key source of the crisis is the diminishing price of oil, which was selling at 97 dollars per barrel in 2013, but fell to 48 dollars per barrel by 2015. This has hit the country harshly as crude oil exports are a central pillar of the Venezuelan state-led economy, with this commodity making up 97.7 per cent of merchandise exports from Venezuela in 2013.

crisis in venezuela
People line up outside a supermarket in Caracas © Federico Parra/Getty Images

This reduction in the price of oil has resulted in hyperinflation and economic deterioration in Venezuela, compounded by rising levels of crime. Caracas has now been listed as the second most violent city in the world.

The economic crisis has meant the government has been less able to support social welfare programs, and food and medicine shortages have hit the nation. Shelves in shops are empty and people queue in long lines for basic goods. To counter this the government has enacted food rationing and an estimated 35,000 Venezuelans crossed the border to Colombia in order to buy basic goods when it was briefly re-opened by President Nicolás Maduro on the 10th of July.

The political situation

Currently Maduro, who succeeded Hugo Chavez following his death and was elected to a six-year term, has put all the blame on falling oil prices and an economic war being conducted by the country’s rivals, such as the United States. Yet his critics have blamed failed socialist economic policies for Venezuela’s recession, triple digit inflation and lack of products in shops.

President Nicolás Maduro © Federico Parra/AFP/Getty Images

With the current situation, opposition to Maduro has been mounting with the opposition coalition Democratic Unity Roundtable (MUD) winning 99 of 167 seats compared to Maduro’s United Socialist Party of Venezuela (PSUV) that won 46 seats in the legislative elections held in December 2015.

Furthermore, the opposition has been successful in overcoming the first hurdle to enacting a presidential recall referendum by gathering over 200,000 signatures in a petition, according to the National Electoral Council of Venezuela. These are enough to set off the process of calling a referendum that would ask the electorate whether they want Maduro to continue to govern. Protests have also broken out. Protester Rueben Merenfield, a 58-year old hardware seller, stated, “we’re tired of standing in lines, tired of skipping meals”, and that “we want the referendum promised by the constitution”.

This has led Maduro to state that if a recall referendum occurs and is legal he will accept the people’s decision.

venezuela protests
Demonstrations against the government, in Caracas © Juan Barreto/AFP/Getty Images

Lessons to be learned

Political and economic instability shows that a change needs to occur, in terms of the economic structuring of the state or its political leadership. Furthermore, the current situation in Venezuela provides a stark warning for nations that rely heavily on the revenue from natural resources that are subject to volatile price fluctuations.

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