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Venezuela registered in the last six years the “sharp” fall of 99% of its oil revenues, President Nicolás Maduro assured Tuesday, attributing part of the economic catastrophe to financial sanctions imposed by the United States to depose him.
“Between 2014 and 2019, Venezuela experienced the sharpest drop in external income in its history, maybe it’s the first time that I refer to these numbers publicly: in six years we ask for 99% of the volume of income in foreign currency, “Maduro said during a mandatory radio and television channel.
From 2015 “onwards the rate of decline in foreign income in Venezuela rises to 30,000 million dollars a year,” he said. “This figure defies one’s imagination, it is impossible to even imagine the size of the pressure that has been applied to our economy”, stressed the heir of former President Hugo Chávez (1999-2013).
According to Maduro, under whose management the country with the largest oil reserves in the world is moving towards its seventh year of recession, “of every 100 dollars or euros that the country obtained from the sale of oil in 2014, it now obtains less than one.”
This caused that the income went from more than 56,000 million dollars (in 2013) “to less than 400 million dollars last year,” he stressed, describing the fall as “gigantic.”
The debacle, he indicated, “had as its initial cause the declared war against oil prices” to “attack the main producers in the world”, and then “it went to phase two, the collapse, the total blockade, the total persecution to the economy and finances of the country ”.
“Anti-blockade law”
The United States has maintained a de facto embargo on Venezuelan crude since April 2019, in addition to other sanctions. The bulk of these measures came into force after the 2018 elections that gave Maduro a second term, but were branded as fraudulent by Washington.
In his speech, Maduro, whom Donald Trump calls a “dictator”, denounced a “Criminal blockade” This is due to “an economic savagery” that has affected “significantly” social indicators such as “infant mortality and morbidity” and “the nutritional levels of the population”.
The private Survey on Living Conditions (Encovi) presented last July by the main universities in the country, revealed that the indexes climbed to levels “never” seen: income poverty reached 96.2% of households in 2019, and extreme poverty, 79.3%, compared to 92.6% and 76.5% in 2018.
Maduro presented on Tuesday a proposal for “anti-blockade” law before the Constituent Assembly – controlled by the ruling party – that governs the country and that in practice assumed the functions of Parliament, the only power in the hands of the opposition.
With this law, the president hopes that his government can “advance in new modalities” that “circumvent all the mechanisms of persecution and international blockade.”
This, after denouncing the “last of the economic filibustering acts”, a month and a half ago, he said, against ships loaded with supplies to “reactivate the refineries, produce gasoline and supply the domestic market.”
“Ships from Liberia that brought 3 million barrels of gasoline to Venezuela, were captured, illegally expropriated by the government of Donald Trump and auctioned off the merchandise” that “had been paid for by Venezuela,” he said.
During the Covid-19 pandemic, Venezuelans have experienced an agonizing gasoline shortage that the socialist government has tried to quell with imports, a paradox in the country that produced 1.3 million barrels of fuel per day.
“Macroeconomic disaster”
But although the sanctions have “exacerbated” the crisis, experts attribute its origin to mismanagement in the government and corruption.
“In 2014 the price of a barrel of oil averaged $ 89, there was no penalty and there began the recessionary cycle in Venezuela,” says José Manuel Puente, professor at the Center for Public Policy at the Institute for Higher Studies in Administration (IESA). describing a “macroeconomic disaster.”
“But it must be recognized that the sanctions are exacerbating the problems of the economy,” Puente tells AFP.
Without oil, “Venezuela would be a second Haiti”, warns the analystThis compared to the worst drop in production in the last seven decades, from 3.2 million barrels per day in 2008 to around 400,000 today.
To the effects that “the industry already had due to erratic management and corruption, now we have nowhere to send production” due to US sanctions, indicates oil expert Carlos Mendoza Potellá, advisor to the Central Bank of Venezuela (BCV).
“The sanctions have suffocated us (…) We were in a critical, frightening situation and this aggravates it,” says Potellá, a critic of corruption at the state oil company PDVSA.
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