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April 2015

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Venezuela's Crisis, U.S. Sanctions and the UNASUR Reaction
by Patrick Duddy

On March 14, the Union of South American Nations (UNASUR), meeting in Quito, Ecuador, delivered a stinging rebuke to the United States. Reacting to a U.S. Executive Order authorizing sanctions against a number of Venezuelan officials, the 12 member-states of UNASUR unanimously rejected the U.S. sanctions, asserted their support for Venezuelan sovereignty, and called on the United States to rescind the executive order. On March 9, the White House had announced the sanctions, declaring the situation in Venezuela "an extraordinary threat to the national security and foreign policy of the United States." The order was issued pursuant to bipartisan supported legislation signed by the president in December 2014 in response to the unraveling of Venezuela’s democratic institutions and the deteriorating human rights situation there. It enumerated a number of reasons for which Venezuelan officials could have their visas cancelled and U.S.-held assets frozen. Seven officials were listed as immediately subject to the measures outlined in the executive order.

The reaction of UNASUR was important, but also predictable and disappointing. It was important because Latin America in general is more important to the U.S. than it has ever been. More than forty percent of all U. S. exports, for instance, now flow to the Western Hemisphere. It was predictable in part because the characterization of Venezuela as a national security threat to the U.S. was bound to resonate badly in Latin America but also and more importantly in part because the default position within South America has long been solidarity with other Latin nations when the U.S. takes action unilaterally. It was disappointing because the situation in Venezuela is becoming critical and the region’s governments have seemed so reluctant to do more than call for dialogue and remind Venezuela that democratic governance and respect for human rights are "fundamental principals" for UNASUR. 

A second UNASUR declaration on March 14 renewed the mandate for a commission of foreign ministers and the secretary general to travel to Caracas to advocate for a constitutional solution to the current crisis. The communique stressed the significance of the legislative elections scheduled for the fall of 2015 but avoided any direct criticism of Venezuela.

Venezuelan President Nicolas Maduro, who was narrowly elected after Hugo Chavez died from cancer in 2013, has presided over a dismal period in Venezuela’s modern history. Inflation spiked to more than 68 percent last year. Criminal violence is nearly out of control; the country now has the world’s second-highest homicide rate among countries not at war. An acute scarcity of basic consumer goods has thousands of Venezuelans standing in line every day to purchase basic necessities. Mass demonstrations in early 2014 to protest the deteriorating economy and the criminal violence were brutally repressed -- 43 people were killed, hundreds were injured and thousands were arrested. Although the protests have ebbed, conditions have not improved, a number of key opposition leaders remain in jail and the government has looked increasingly desperate and authoritarian.

Throughout his time in office Maduro has regularly tried to distract domestic and international attention from the failures of his government by claiming that the U.S. is conspiring with the regime’s domestic opponents to overthrow him and is involved in an economic war against Venezuela. He insisted the White House announcement confirmed Venezuela’s accusations of U.S. plotting and characterized the executive order as a preamble to military intervention. Maduro also sought and was granted by the Venezuelan legislature the authority to govern by decree.
South America rejected the U.S. executive order even though there was no extraterritorial dimension to the measures contemplated. Canceling visas, freezing assets and blocking access to the U.S. financial system are internal measures. The executive order did not impose or threaten economic sanctions on the Venezuelan national economy. This is significant because the U.S. remains the largest market for Venezuelan oil and oil generates more than 95 percent of Venezuela’s export earnings.

It is nevertheless significant that this apparent rebuff for the Obama administration happened at a time when the United States has been re-engaging with Latin America on several fronts. Late last year, the administration announced its intention to restore diplomatic relations with Cuba, a move that was met with broad approval by virtually all of Latin America. In February, Vice President Biden hosted a meeting with leaders of the Caribbean to discuss energy security, a theme of increasingly urgent importance given that many Caribbean nations depend on Venezuela and its deteriorating economy for discounted oil. More recently, the administration announced its intention to seek an additional $1 billion for Central America in the FY 2016 budget.

At last week’s Summit of the Americas in Panama, the Venezuelans tried and failed to rally regional option to the U.S. sanctions but introduced an unwelcome tension into the summit proceedings. Until this contretemps, many analysts assumed the Obama administration’s Cuba initiative had resolved the most intractable and longstanding obstacle to a productive meeting of Western Hemisphere leaders. It is now clear that all but the most adamant critics of the U.S., like Bolivia’s Evo Morales, do understand that there are other, bigger regional issues to work through and it is everyone’s interest to do so.

It is important that leaders look hard at how North and South America will work together going forward to support democracy, build civil society and increase prosperity in the Americas. Despite UNASUR’s reaction to the U.S. sanctions, many --maybe most -- observers around the region and elsewhere concede that Venezuelan democracy has been hollowed out, that the political atmosphere has become repressive and that its economy is crumbling. More than twenty former presidents from around Latin America published an open letter just prior to the Summit emphasizing their concern for what is happening in Venezuela. This may have blunted efforts to turn summit into an extended session of U.S. bashing. Still, the public missive from the ex-presidents stood in marked contrast to the reluctance of the region’s sitting presidents to criticize Caracas.

The language in the U.S. executive order characterizing Venezuela a threat to the national security of the United States may seem hyperbolic to some but the crisis in Venezuela is real. UNASUR efforts to encourage dialogue last year failed. At the same meeting at which they scolded the U.S. for interventionism, they announced their intention to try again to foster a dialogue between the Maduro government and its domestic opponents. North Americans should wish them success. Criticizing the U.S. for taking the very limited steps contemplated by President Obama’s executive order will not improve the reality on the ground in Venezuela. Maybe a new mediation effort will fare better. It is in no one’s interest to see Venezuela collapse—either politically or economically. But stability achieved at the price of the political liberties that the region worked so hard to recover in the relatively recent past is not going resolve the problems of the present moment.bluestar

American Diplomacy is the Publication of Origin for this work. Permission to republish is freely granted with credit and a link back to American Diplomacy.


Author Patrick Duddy is the director of Duke University’s Center for Latin American and Caribbean Studies. He served as the U.S. Ambassador to Venezuela from 2007 until 2010.

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