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Deteriorating economic situation fuels mass protests in Venezuela

April 03, 2014, 16:21 UTC+3 Alexandrova Lyudmila
Anti-goverment protests

Anti-goverment protests


MOSCOW, April 03. /ITAR-TASS/. According to Russian experts, mass anti-government rallies, which are already on the second-month run in Venezuela, were first of all instigated by a deteriorating social and economic situation and a split in the society, but not by foreign interference.

A total of 37 people have been already killed as a result of mass protests, which started gathering steam in mid-February. Venezuelan President Nicolas Maduro called the protests an attempt at a government coup, adding that the United States authorities allocated an annual of $5 million to oppositionists in Venezuela.

Emil Dabagyan, a leading research fellow at the Center for Political Studies of the Institute of Latin America with the Russian Academy of Sciences, said in an interview with ITAR-TASS that “the United States would be definitely happy if the authorities changed in Venezuela since the relations between the two countries are tense.”

“However, the current events are not the outcome of foreign interference, but a result of a grave domestic situation, which [late President] Hugo Chavez left behind and this situation first of all concerns the economy and the actual split in the society,” Dabagyan said.

The expert recalled that the presidential election held after the death of charismatic leader Hugo Chavez in March of 2013 ended with an almost neck-to-neck result for two candidates in the race. Chavez’s successor and current President Nicolas Maduro secured 50.6% of the votes, while Henrique Capriles, the candidate from the united opposition, garnered 49%.

“The election results demonstrated the split of the country in two almost equal parts,” Dabagyan said.

Tens of thousands took to the the streets. Discontent with the situation in the country started boiling over.

“Continued cash infusions into the relative comfort of Venezuela’s poorest population segments had a backlash effect. Industries - a source of the lion’s share of dollars revenues - have been bled white,” Dabagyan said. “The economy slumped. Some 4,000 processing industry enterprises were shut down over the past ten years.”

Struggling to balance the economic situation in the country the authorities passed a set of repressive laws in regard to businessmen. In particular, the authorities restricted the norm of profit by 30%. Venezuela has never been a land of milk lakes and butter mountains for private businesses. The set of new regulations only deepened the industrial crisis in the country.

The situation is overburdened by the exchange rate and the national debt, which makes up 70% of GDP, and the soaring inflation, which is the highest on the continent. In 2013 it peaked to 58%.

“Monstrous crime rates, bureaucracy blown out of proportion, wholesale corruption at all administration levels, capital flight, brain-drain and food shortages - this is what the present day situation in Venezuela is like," Dabagyan says.

Vladimir Semago, a former United Russia deputy and a member of the Russian-Venezuelan Business Council, said in an interview with daily that this year Venezuela still faces the same problems that emerged in the last year of Chavez’s rule.

“To some extent it has even got worse due to decisions made by the current president,” Semago said. “He [the president] chose the path of the military communism, a situation where everything is decided by means of coercive mechanisms.”

“Chavez passed on the relay baton to Maduro not at a time of Venezuela’s economic prosperity. Maduro took over when the country already nose-dived. It turned out to be far from easy to mobilize forces around him in such a situation,” Semago said.

Dabagyan sees three possible scenarios for Venezuela.

One is Maduro straightens up the economic situation and the political atmosphere normalizes. Another is the opposition may initiate a referendum on terminating the presidential powers and legally dismisses the president from the office. Such a referendum can be legally held with the president being in power half way through his term, which in this case will be in two years' time, and with the support of at least 20 percent of voters.

However, the expert said, a third scenario is possible, too, and it could be far harsher than the previous two.

“A group of Hugo Chavez’s former military colleagues might dismiss Maduro under a plausible excuse and begin a bold nationalization policy by terminating expansive projects and putting a stop to gratuitous aid for foreign countries,” Dabagyan said.

Mikhail Mironyuk, an expert with the Moscow Higher School of Economics, said a military coup in Venezuela was possible.

“Venezuela saw quite a few military coups in the 20th century,” Mironyuk said. “Chavez himself was victim of one of such coups.”

Dabagyan said good relations between Russia and Venezuela would remain even in case the opposition comes to power in the Latin American country.

“Capriles is a follower of the so-called Brazilian model. His foreign policy will be balanced and there will be no confrontation with the United States,” the expert said.

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