richardfrosty – Richard Frost – Manchester

Original publication date: May 2007
Outlet: In The News
Photography taken: November 2016 (© Richard Frost)

A challenge to the west

Venezuela has once again unveiled a policy that divides opinion across the Americas. Richard Frost analyses the latest flashpoint and reviews the main areas of conflict to date.

Economics
It’s just been announced that Venezuela is withdrawing its membership of both the World Bank and the International Monetary Fund. The first institution hands out financial aid to developing economies, while the second monitors global exchange rates.

However, both are based in Washington DC, and critics claim they’ve long been dominated by the US for political ends. More specifically, opponents argue that the US effectively uses them to bully developing nations into submission, ensuring the institutions do not offer economic assistance unless recipients agree to reform along free-market principles. As such, Chavez’s symbolic decision sends out a powerful message to the rest of Latin America that it might actually be possible to break free of US influence once and for all.

Trade
Caracas is an outspoken opponent of the US-backed Free Trade Area of the Americas, which Chavez argues provides an unfair trading advantage to the US. As an alternative, the president has proposed a rival multilateral trading arrangement, in which Latin American countries seek to support one another’s growth. For instance, Venezuela’s oil is currently being sold at preferential rates to Cuba in return for professional expertise, while Argentina and Bolivia have received huge injections of cash in recent years.

Hugo Chavez mural in Havana

Venezuela has even brought its controversial trading practices to North America. In late 2005, as oil prices spiralled out of control, Chavez announced that Venezuela would offer cut-price oil to disadvantaged residents living in the US. The policy was universally seen as a political insult aimed squarely at the Bush administration.

Socialism
Upon gaining re-election last year, Chavez sparked alarm among many western commentators by immediately declaring Venezuela would accelerate its conversion into a “democratic socialist” country. One particularly controversial aspect of this has been the nationalisation of private oil projects in the Orinoco Belt, and an attempt to repeat the trick with telecommunications infrastructure. Capitalist investors in the region are understandably none too impressed.

Meanwhile, the transformation has affected social policy as well. Since being installed as president in 1997, Chavez has instigated a series of so-called “missions” designed to alleviate poverty – from a drive to boost enrolment figures in primary schools to a comprehensive overhaul of the healthcare system.

The future?
Venezuela’s vast oil wealth and its policy of encouraging neighbours to shun the west mean it is becoming increasingly difficult to ignore. For the US, the full extent to which relations have soured was rammed home recently when, speaking after being re-elected for a third term, Chavez took the opportunity to launch a stinging personal attack on president George Bush, branding him “the devil” and “Mr Danger”.

So what can be done? Back in 2002, several media reports alleged that the US secretly supported a failed military coup against Chavez. However, times have changed. Venezuela is now one of the world’s most high-profile political players as a result of soaring oil prices, and can count on international support from Russia, China, Cuba, Bolivia, Iran and others. What’s more, Chavez received a massive two-thirds of the vote when Venezuela went to the polls last December.

With such overwhelming support, the west must surely now acknowledge that the new “democratic socialist” Venezuela is here to stay.