Saturday, 24 September 2011

Venezuela at the end of 2011

The situation

Venezuela is not getting the money it should get from the the oil industry because PDVSA is in bad shape, corruption keeps growing and the president, who rules Venezuela as if it were his personal farm, is ill...or terminaly ill, or faking to be ill, depending on whom you ask.

We read that Akhmadinejad is not coming to Venezuela because Chávez is too ill (his chancellor, Maduro, said it is "waiting a few weeks for the completion of the healing programme".

The country is experiences protests everywhere. People protest and often don't know what their ultimate plan is. They want the State to help. Sometimes they want security, which is very much their right. Sometimes they want help in social housing, which is very much fair. Sometimes they want houses for free, which is not stupid and can only be possible in a place where most follow a cargo cult. Sometimes they want the government to improve their conditions that deteriorated after some of them asked the government to privatize their companies. Sometimes they are fed up of the way in which health services are collapsing. A lot are angry because blackouts and general electricity shortages are our daily bread. People close streets everywhere, burn tyres, make a lot of noise and the ones who suffer the most are other civilians. The mood is bad. The honchos in power are fine.

Daniel wrote about how the government wants now to limit profit in Venezuela to 10% while that same government is overpaying Nicaraguan and Iranian and Chinese exporters for political reasons. Inflation is almost 30%.The IMF predicts GDP growth of 2.7% and the Venezuelan government annouced that as a big achievement, but that is only because most people don't know how to interpret GDP growth. Venezuela has a population growth that is almost 2%, it has had over 15% more revenues due to higher oil prices since 2010, it is the slowest growing country in South America. You can't compare 2.7% of Venezuela with 1% for Germany.

The Forecast

What can you expect in the coming three months?

A lot depends on Chávez's real or perceived health status. Beyond that, we can expect the following:
1) the Chávez honchos are again increasing the personality cult around Chávez. This will reach even more mental levels in the coming months.
2) more money will flow from Fonden and other state resources to the Chávez campaign.
3) the regime will put more efforts on trying to use Leopoldo López to divide the alternative forces.

At the same time we will see an increase in the competition between the different pre-candidates for the opposition. If this is carried out in a fair manner, it could benefit democracy in Venezuela. If not, obviously, we will have more military government to come.

Expect Russia and China to meddle more and more in Venezuela's affairs. Venezuela means too easy money for them. The Chinese can become more flexible when it comes to accepting a regime change. The Russians know they will lose one of their best buyer of weapons. As the CEO of Rosobonexport, Anatolii Isaikin, declared, Venezuela was one of the five countries on which the Russian merchants of war count, together with huge China, India plus Algeria and Vietnam.

I take this picture from Miguel's you see Venezuelan chancellor in a "mass" organized in Mannhattan to pray for the caudillo's health

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