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Caracas guest in Davos: US is changing its tactics in Venezuela?

Author : Georgiy Kuhaleyshvili

Source : 112 Ukraine

This year, Venezuelan Parliament Speaker Juan Guaido is one of the participants in the World Economic Forum in Davos
08:20, 23 January 2020

Open source

This year, Venezuelan Parliament Speaker Juan Guaido is one of the participants in the World Economic Forum in Davos. Last year, the United States and more than 50 countries recognized Guaido as president instead of the current head of state, Nicolas Maduro, amid ongoing anti-government protests in Venezuela, civil strife and the economic crisis.

On the eve of the event, Guaido met with US Secretary of State Mike Pompeo at a regional conference in Colombia. The head of American diplomacy emphasized that the ultimate goal of the US strategy in Venezuela is a change of power, and urged the countries of Latin America, Europe and the whole world to contribute to this. American sanctions against individual Venezuelan officials, the country's oil and gas sector did not force Maduro to resign.

Guaido’s attempts to gain support from Venezuelan senior army officers and organize a military coup turned out to be a complete failure. The Americans are changing tactics in the Venezuelan crisis, realizing that unilateral restrictive measures were not enough to put pressure on Caracas.

Related: Ukraine's PM Honcharuk met with Finnish Prime Minister in Davos

Change of tactics

The Venezuelan oil embargo is imposed on Venezuela, which, together with the effects of the economic crisis, has led to a reduction in oil exports from 3 to 1 million barrels per day. Under the blow of sanctions was the PDSVA state-owned company. The sale of “black gold” is a key source of replenishment of the budget of Venezuela.

In August 2019, the United States imposed an economic embargo on the Venezuelan government: it froze all assets, forbade American firms to make settlements with it. Before the embargo, the US share in Venezuelan oil exports was 38%.

Last year, the States called on India, China and other countries to refrain from acquiring Venezuelan oil. The Venezuelan economy lost $ 20 billion in revenue as a result of U.S. actions, a number of customers stopped accepting Venezuelan tankers, but not everyone refused black gold from Venezuela.

Pompeo’s and Guaido’s task is to convince other authorities to join the US sanctions against the Maduro regime. There are legal grounds for a change of power in Venezuela. According to Art. 350 of the Constitution of Venezuela, citizens can renounce any regime, legislation that violates democratic values ​​and principles, encroaches on human rights.

112 Agency

At a conference in Colombia, they tried to convey this idea to the governments of Latin American states. Brazil accounts for 5% of oil exports from Venezuela. Brazilian President Jair Messias Bolsonaro recognized Guaido as president but limited to criticizing the Maduro regime and refraining from sanctions. Venezuelan oil is bought by Bolivia, Colombia and a number of Caribbean countries, including Cuba, a long-standing ideological ally.

The Davos Forum is a negotiation platform where business circles, representatives of the political elite, civil society, science from around the world meet to discuss global economic and political processes. It is not surprising why Guaido paid a visit to this event.

Juan Guaido
bbc.com

Most EU member states imposed personal sanctions against Venezuelan officials, recognized Guaido as president, with the exception of Italy, Slovakia, and Cyprus, which limited themselves to supporting the Venezuelan parliament, dominated by opponents of Maduro. Nevertheless, this does not prevent a number of European states from continuing to acquire Venezuelan oil and fuel the Maduro regime.

During 2019, Venezuela supplied Europe with over 118 million barrels of oil per day, mainly to the refineries of the Spanish company Repsol, which has a joint venture with PDSVA. Venezuelan oil is bought by Great Britain, France, Benelux, Denmark, Sweden, and Norway.

Last year, 65% of Venezuelan exports came from Asian countries. Despite the fact that the Chinese company CNPC refrained from loading oil in Venezuelan ports, China purchased 319.5 million barrels of oil per day. India, Malaysia, and Singapore acquired a total of over 326 million barrels of Venezuelan oil. Venezuela supplies oil to foreign markets bypassing sanctions through intermediary firms.

In this regard, the Russian company Rosneft succeeded. In 2019, Rosneft acquired a third of the exported oil from Venezuela and resold it to Chinese firms and other customers from Asian countries. There are joint ventures between PDSVA and Rosneft and CNPC.

Related: Zelensky outlines new Ukrainian reality during his speech in Davos

Maduro’s regime will stay afloat until there is a buyer for Venezuelan oil. In early January, socialists even tried to remove Guaido from the post of speaker of parliament in order to enact laws to grant licenses to partners from Russia and China to develop new mineral deposits, including oil and gas.

Deputy Luis Parra proclaimed himself a speaker without following the necessary formalities, and the Venezuelan security forces blocked the parliament building. Probably, the former ally of Guaido made a deal with the socialists, who, apparently, made him an offer, which he could not refuse.

According to unofficial information, the socialists paid MPs from 500,000 USD to 1 million USD for voting against Guaido. The Russian Foreign Ministry recognized Parra as the new speaker of parliament.

Related: PM Honcharuk announces 'good news' from Davos

US interests

The Americans want to achieve a change of political regime in Venezuela in order to gain control of the country's oil and gas sector. Now in Venezuela, only Chevron works from American companies. A reduction in Venezuelan oil exports will entail an increase in world oil prices. In 2020, Venezuela is expected to reduce oil supplies to foreign markets to 800-600 million barrels per day.

Under current conditions, it is beneficial to the United States. With the advent of President Donald Trump, the United States has increased oil production and export. On average, the United States exported 2.5 million barrels of oil per day in 2019. The US needs to eliminate a competitor in the global oil market, so they are interested in other countries joining sanctions against Venezuela. Venezuela (300 billion barrels) exceeds Saudi Arabia (260 billion barrels) in oil reserves.

The US wants to influence the outcome of the parliamentary elections in Venezuela by tightening pressure on the Maduro regime. American partners from the Round Table of Democratic Unity parliamentary coalition lose initiative in confronting the United Socialist Party and Maduro, who usurped power in the country: falsified the results of the presidential election, initiated the creation of the Constitutional Assembly, which amended the Basic Law and assumed the functions of parliament.

In the face of political setbacks, Guaidó's popularity declined from 63% to 39%, and a split occurred in the center-right ranks, judging by the recent crisis in the Venezuelan parliament.

Related: Maduro announces arrival of aircraft with Russian military specialists in Venezuela

If other countries join the American oil embargo, the Maduro regime will lose its feeding trough, and dissatisfaction with its policies in Venezuelan society will only grow against the backdrop of a difficult economic situation. Right-centrists led by Guaido can offer Venezuelan voters a "tit in the hand" in the form of humanitarian aid.

The Venezuelan military does not pass humanitarian convoys from Colombia by land, but the center-right are considering the option of dropping food and medicine from aircraft over areas of Venezuela, where representatives of the “Round Table of Democratic Unity” hold the power. The population of the republic is on the verge of starvation.

Barriers

The mistake of Trump and Guaido is that they underestimate the vitality of the Maduro regime, which has acquired partners who are profitable to work with him. Do not overestimate the diplomatic abilities of Guaido. Convincing foreign leaders to abandon Venezuelan oil for the sake of the ideals of democracy will not be as easy as pulling the Venezuelan military to their side. Unlike Maduro, which controls oil, Guaido simply has nothing to offer.

Europe holds a similar position in the Venezuelan crisis, as in the conflict in eastern Ukraine. European countries have limited themselves to personal sanctions and refrain from tightening them since this is unprofitable for economic reasons.

The oil embargo is not profitable for Spain, not only because it buys oil, but also because the Venezuelan government repays loans through gratuitous supplies of black gold. According to the same scheme, Venezuelans pay off debts to China and Russia.

Even if the EU showed solidarity with the United States, its share in Venezuelan oil exports is substantially less than that of China. China and Russia recognize the Maduro regime, while India is neutral in the Venezuelan crisis. Venezuela will continue to supply oil there. Brussels is unlikely to show solidarity with Washington on the Venezuelan crisis amid disagreements over NATO funding, defense spending, Trump's protectionist policies, and climate protection.

Related: Venezuelan president Maduro travels to Russia to meet with Putin

In addition to diplomatic support from the influential countries of the world, Guaidó and his supporters have nothing else, while the Maduro regime enjoys the military support of Russia and receives funding from China. Without US intervention in the Venezuelan crisis, center-rightists are unlikely to be able to change anything.

However, Trump is afraid to take on the role of an international policeman and send troops to change the political regime in Venezuela out of fear of getting stuck in a bloody armed conflict on the eve of the US presidential election.

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