Courcy’s Intelligence Brief

Hugo Chavez’s successor, President Nicolas Maduro, is continuing his push towards an even more authoritarian system.  Sources in Caracas say that his aim could be to turn Venezuela into a Cuban-style command economy in which all economic decisions are centrally planned and controlled by the government.

The latest indication of Maduro’s intent came on 12 November with the stripping of an opposition deputy of her parliamentary immunity over corruption allegations.  The deputy in question, Mercedes Aranguren of the small dissident Movimento Independiente Ganamos Todos (Migato) says the charges are trumped up and politically motivated.  True or false, this move makes it likely that the ruling PSUV will gain the three-fifths majority it needs to approve a law that would give the president the right to rule by decree for 12 months.  These additional powers would be added to his already existing control of the national assembly, the judiciary, the regulatory agencies, the armed forces, and most of the media.

The text of the enabling law was revealed on 15 October.  It fails to identify which Venezuelan laws the president can amend by decree, and it potentially gives Maduro effectively autocratic powers to implement the third and final stage of the “transition to socialism” as outlined by Chavez in his final 2013-19 government plan. 

On 6 November, Maduro unveiled a package of additional measures imposing tighter central government controls over the domestic market for consumer goods.  This is being overseen by the new superior council for the defence of the economy (unveiled on 12 September to ‘guarantee the economic security of Venezuela’), run by a military officer, Hébert García Plaza; along with the vice-president for economic affairs, Rafael Ramírez, who doubles as energy minister and president of the state oil company Petróleos de Venezuela (Pdvsa).

While the government accuses the opposition and the private sector of economic ‘sabotage’, particularly hoarding, price speculation, and abuse of the officially-controlled foreign exchange market to earn arbitrage profits, the opposition claims that individuals and companies linked to the Revolution are the worst offenders.  This week there were fresh opposition calls for the government to publish the list of companies assigned foreign exchange, so that the general public can see for itself what’s going on.

Opposition leader Henrique Capriles Radonski has also accused Maduro of negotiating ‘secret deals’ in a desperate bid to shore up the country’s foreign reserves (down to US$21bn as of 11 November) and cover its FX needs.  He alleged that the government is selling off central bank (BCV) gold reserves and Pdvsa holdings in the likes of the US oil company Citgo and negotiating credit deals with suppliers.  Pdvsa has announced a plan to sell US$4.5bn in bonds, its first issue since May 2012.  Sources suspect the notes could be sold in a private placement to the BCV for currency auctions, as well as to oil service providers to pay off debt.

A final thought on Maduro’s latest power grab is that it may reflect more of a need to overcome divisions within the Bolivarian Revolution rather than opposition from without.  In short, what is going on is most likely a continuation of the fierce internal power struggle that was set off by the death of Hugo Chavez on 5 March.