The Biden administration, along with U.S. intelligence and military agencies, were stunned by the gains the Taliban made in seeing them seize the Afghan capital Kabul and take power earlier this month. The rapid collapse of the US-backed government and its security forces came as a total surprise to Washington. The assassination in early July 2021 of the Haitian president, allegedly by Colombian mercenaries, as well as six weeks of anti-government violence demonstrations Colombia, a longtime ally of the United States, also caught the Biden administration off guard. These events underscore that Biden, despite his campaign as a seasoned expert in international relations, lacks a genuine understanding of the many pressing geopolitical crises that threaten regional stability and urgently require Washington’s attention. One of these dilemmas is the the fate of Venezuela, once the richest and most stable democracy in Latin America.
The OPEC member, once one of the world’s largest oil exporters, is on the verge of collapse after decades of corruption and malfeasance by the ruling United Socialist Party of Venezuela. The potential for state implosion is accelerating due to tough US sanctions, falling oil prices, and the near failure of its economic backbone, the oil industry. This confluence of events sparked a seemingly irreversible deep economic crisis for Venezuela, which has been described as the worst economic collapse outside of the war. It causes immense suffering to the Venezuelan people. It is estimated that more than 90% live in poverty and more than five million people have fled their countries, settling mainly in neighboring countries, notably Colombia, creating what is the second worst humanitarian disaster in the world. This massive influx of economic and political refugees into neighboring countries, especially Colombia, exacerbates existing social unrest in the region. In Colombia alone, these refugees compete for work in a country with double-digit unemployment, where more than 50% of the population works informally and more than 42% (Spanish) live in poverty.
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Venezuela’s economic implosion means Caracas is nearly bankrupt and unable to finance basic public goods, including security forces capable of maintaining a monopoly of violence in petro-state territory. As the state gradually collapses, withdrawing from many remote areas, various towns and small towns have fallen into isolation. It is non-state armed groups that intervene to fill the void. The Marxist National Liberation Army of Colombia (ELN – Spanish initials), with an estimated strength of 1,500 combatants, has established a significant presence in Venezuela. The guerrilla group, long tolerated by Chavez and Maduro, operates in the states of Amazonas, Apure, Bolivar, Táchira and Zulia, controlling lucrative smuggling routes, illegal gold mining and extortion. In many communities that do not have a government presence where the ELN operates, the guerrillas have become a sort of de facto state, delivering justice and providing basic public goods. The ELN’s flourishing presence in Venezuela can be attributed to Caracas’ inability to control its territory and curb the group’s activities. As the power of the ELN expands, they may profit more from illicit lucrative activities including cocaine as well as arms trafficking and illegal mining.
FARC dissidents, who are involved in illicit activities similar to ELN’s, are also expanding their presence in Venezuela as the state weakens further and continues to collapse. This saw the 10th and 28th FARC Fronts, which refused to recognize the 2016 peace agreement with the Colombian national government, expand their presence to the Venezuelan Colombian border. Clashes, earlier this year, between the 10th Dissident Front of the FARC and the Venezuelan security forces, in the State of Apure near the border with Colombia, highlighted the rise of FARC dissidents. Using classic guerrilla tactics, honed during years of battle with the Colombian army, the dissident FARC fighters defeated the Venezuelan army.
These events further underscore how weak Caracas has become and the government’s inability to effectively maintain sovereignty over Venezuela’s national territory. It is not limited to remote areas; Maduro’s autocratic regime also regularly loses control of Caracas, with the city’s western suburbs becoming virtual war zones as various armed gangs battle security forces for control. In the last reported incident, who took place in July 2021 around 300 armed gang members fought pitched battles with the police. There is a growing consensus among analysts and academics that Maduro’s regime is gradually losing its grip on power in Venezuela. Reuters cited Alexander Campos, a researcher at the Central University of Venezuela, said: “It is becoming more and more evident that Maduro is losing control inside and outside Caracas”.
Venezuela’s massive financial catastrophe sparked by the near collapse of the economic backbone of the petro-state, its oil industry, essentially bankrupted Caracas, making it nearly impossible for Maduro’s regime to maintain control of the country. As sharply divided opposition and harsh US sanctions appear unable to topple Maduro’s authoritarian regime, there are growing fears that Venezuela will eventually implode, leaving a failed state. If Venezuela is unable to rebuild its shattered economic backbone, the oil industry which requires investment anywhere up to $ 200 billion, then the state is likely to implode. Strict US sanctions cutting Venezuela off from global capital and energy markets prevent Caracas from acquiring the necessary capital, whether through oil exports or funding from international lenders. These severe measures dissuade urgent investments of Western energy supermajors who are the only oil companies with the capital, technology and expertise to rebuild the crumbling Venezuelan oil industry. For these reasons, Venezuela’s economic crisis will worsen, increasing the risk of state collapse.
While failed states are not contagious, they fosters civil unrest, political unrest and heightened conflict in neighboring states. As Afghanistan has repeatedly demonstrated, the vacuum left by a failed state provides a safe haven for terrorist and criminal groups while creating an ideal environment for extremist regimes to take power. While Maduro’s authoritarian regime is unlikely to be replaced by radical political power, as happened in Afghanistan, state failure will create a vacuum that various non-state armed groups operating in the north of South America will seek to fill, causing greater regional unrest. . This is Venezuela descent into chaos it fuels Maduro’s desire to engage with Washington and relax sanctions in order to avoid the collapse of Venezuela.
By Matthew Smith for Oil Octobers
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