Against odds, Venezuelan government survives 2016 (and oils its path into 2017)

Over the past few days, chavista leaders have been publicly boasting that 2016 has been a year of political victories. Convinced that the opposition has run out of short-term options to oust Maduro, high-ranking officials explicitly highlighted three fronts where the government had successfully held its lines in this crisis-stricken year: first, the presidential recall referendum was suspended by the National Electoral Council, due to alleged irregularities in the collection of signatures that activated it; second, the so-called ‘political trial’ that the National Assembly launched in order to remove Maduro from the presidency has failed too, lacking constitutional grounds, delegitimised by the Supreme Court, and even presented by the opposition spokesman as unviable; thirdly, in the dialogue roundtable that in November brought government and opposition leaders to negotiate a political solution to their confrontation (and which is mediated by the Vatican, UNASUR representatives and ex-presidents of the calibre of Dominican Leonel Fernandez and Spanish Rodriguez Zapatero), it is the opposition bloc that is showing, once again, its internal cracks.

Every time that the opposition bloc needs to speak with one voice, a chorus of dissenters competing for the definition of political lines emerges among its ranks.

So government officials seem to have got it their way for the time being. So noticeable is the demoralisation among opposition supporters, and so blatant the division among its leadership, that in that respect they may be right: in the proximity of the always appeasing and distracting Christmas, nothing makes the government fear a political counter attack.

Yet, given the severe economic crisis that affects the majority of the population living off salaries, is the overt optimism of government officials justified, beyond short-term political calculations?

There are no signs of immediate solutions to the scarcity of some products and medicines, nor indications that the astronomic inflation of this year is going to recede. Indeed, with the proximity of Christmas, a period of exacerbated consumption, prices keep on going up, and the dollar in the black market, which partly responds to increased demand, is rocketing yet again (in two weeks in Caracas, I have verified a 15% increase in its price).

The confidence of government officials rests on two things that go beyond the political wins they claim: there is the understanding the chavismo as an anti-neoliberal collective political identity remains strong among multitudes of Venezuelans, but also a blind trust in the idea that the government will oil (and mineralise, one could say) their way out of this critical conjuncture.

As a matter of fact, president Maduro and other chavista officials have kept themselves busy. In parallel to boasting about political strength and holding their seats in the dialogue roundtable, they are having a frantic activity seeking to secure commercial agreements that will probably reactivate extractive industries and, perhaps, even stimulate recovery of oil prices (currently below $40 for Venezuelan oil).

In the lapse of a week, Maduro met in Caracas with OPEC’s Secretary General, HE Mohammad Sanusi Barkindo, in a round of talks that seeks to recover the ‘Algiers Accord’ as a strategy to set limits to oil production among members and thus stimulate a price rise. On 30 November there will be a Ministerial Conference of OPEC members, and the organisation’s general secretary and other officials have been actively seeking a favourable ground for coordinating policy in that regard.

Venezuela is evidently interested in an increase of oil prices, but it does not put all its eggs in that basket. While paying lip service to decreasing production, the national oil company PDVSA signed agreements with Chinese CNPC in the Venezuelan presidential palace. These agreements included the prospect of a $2200 million investment from Chinese banks, which, according to president Maduro, should increase national production of oil in 277000 daily barrels.

In the same week, president of PDVSA Eulogio del Pino and Foreing Affairs Minister Delcy Rodriguez met the president of Russian ROSFNET, Igor Sechin, exploring projects for the extraction of gas from Western (Zulia) an Eastern (Monagas) Venezuela.

So the Venezuelan government is clearly double-dipping: negotiating a decrease of oil production with the OPEP while committing with other partners to increase it.

In this wave of negotiations based on the continuing exploitation of natural resources, even the government of some federal states such as Merida have been securing commercial deals, with the support of PDVSA, for the exportation of teak wood (expected to reach 112000 cubic meters in the short term).

And the point is that this is not all about oil. There are minerals too, of course.  In February 2016, the Maduro passed a decree formalising the creation of a “Zone of National Strategic Development ‘Orinoco Mining Arch’”, and rapidly moved to negotiate extractive rights with international corporations. The region affected by this decree and exposed to increased extractivism is a massive territory that comprises over 10% of national territory, and those who oppose it have hardly made their voices heard beyond small foci of activism.

It has been precisely in November too, amidst this government run into recovering national revenues, when Venezuela has been readmitted in Kimberley Process Certification Scheme, which will smooth the access of its diamonds into international markets, now that the Orinoco Mining Arch promises to be opened wide. The Venezuelan Minister for Ecological Mining Development (sic), Roberto Miraval, voiced this news with satisfaction, also recalling that estimates situate in 3000 million karats the amount of diamond potentially extractible from the region.

This is the current scenario in Venezuela. For the time being, there is no realistic chance for the divided and demoralised opposition to oust Maduro, and the government trusts that a part of disaffected chavismo will be recovered if the economic crisis is appeased, if not resolved, next year. This would be greatly facilitated by the history of chavismo, still strong in Venezuela as an anti-neoliberal collective identity. With a recovery of public revenue through renewed extractive ventures or through OPEC manoeuvring, redistributive policies could be revitalised, and the severity of everyday experiences of crisis ameliorated.

But all the magic of Venezuelan resources won’t save chavismo from facing the doubts that assault many of its supporters: what next, if we are given another clean chance to re-start a transformative project?