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Venezuelan residents are in the midst of an unusual political crisis. Since January 23, 2019, the country has had two presidents: Nicolàs Maduro, the incumbent who was reelected in May 2018 and sworn into office on January 10, 2019, and Juan Guaidó, President of the National Assembly, an elected temporary parliament with the mandate to draft or reform the Constitution. The 35-year-old Guaidó, who leads the progressive Popular Will political party, proclaimed himself the country's interim leader on the grounds that the May 2018 elections were rigged, and hence the presidency was vacant.
Even more extraordinary is that most Latin American countries, the US, Canada as well as some European nations have recognized Guaidó as the country's interim president. They are urging him to call new elections as soon as possible. So how did this relatively-unknown politician become the South American nation's hope for democracy, freedom, and justice? Read on.
An economy in shambles
You may have heard of the expression, "Too much of a good thing." That was indeed the case for Venezuela. Home to the world's largest supply of crude oil, the country became increasingly dependent on the seemingly endless flow of cash received from its sale. The strategy worked until 2014, when international oil prices started to plummet, reducing the inflow of foreign currency needed to pay for necessities.
Instead of trying to resolve the issue by encouraging domestic manufacturing, the government, led by the then newly-elected Maduro, continued to buy foreign products, albeit at reduced levels. The shortfall in goods resulted in price increases. To help the residents afford the more expensive products, the officials raised the minimum wage multiple times. Both initiatives were funded by printing more currency. As citizens armed with more money chased the ever-dwindling supplies, the prices rose even higher, leading to hyperinflation. The International Monetary Fund estimates that consumer prices in Venezuela rose by 1,370,000 percent in 2018 and forecasts they will increase by another 10 million percent in 2019.
Why did Maduro get reelected in 2018?
Given the dire economic situation, it may appear surprising that Venezuelan residents reelected Maduro during the May 2018 elections. However, as it turns out, more than half of the country's registered voters showed their disdain for the government by not voting. Most opposition parties also abstained from standing for the elections, believing the results would be fixed in Maduro's favor. That certainly proved true when the incumbent president purportedly received 6.2 million, or 68 percent, of the total votes cast.
The results, instantly declared illegal by the Venezuelan National Assembly, led to massive protests throughout the country. The outcome was also condemned internationally with only Russia, China, Cuba, and 13 other nations accepting the new regime. US President Donald Trump made his displeasure known by forbidding American companies or citizens from doing business with Venezuela. As a result, foreign direct investments from the US to Venezuela declined, from a high of $600 billion annually in 2011 to almost zero in 2018, making the already gloomy economic conditions even worse. However, thanks to the support of the country's powerful military, Maduro refused to give up the presidency.
How will the tug-of-war between the two presidents end?
The recent turn of events, with Guaidó claiming the presidency, is causing some to hope that Maduro will succumb to the pressure and resign. To help the cause, the American government has frozen all Venezuelan assets in US-insured banks. It has also convinced the British government to deny Maduro access to $1.2 billion in gold that the Venezuelan government holds in the country's banks. There also appears to be some discontent brewing among members of the military who are among the millions suffering the consequences of Maduro's bad fiscal policies.
Meanwhile, over 3 million Venezuelan residents have fled to neighboring countries, with no intentions of returning home. Those that remain are struggling to feed their families. Medical supplies are also hard to come by. The situation has escalated further over the last week due to Maduro's refusal to accept $20 billion worth of supplies sent by the US federal government. On Tuesday, February 12, 2019, tens of thousands of Guaidó supporters took to the streets to try to convince the military to allow the desperately-needed aid, currently being stored in Colombia, to enter the country. Hopefully, Maduro will feel the plight of the residents and allow that to happen soon, and perhaps even rethink his stance and resign from office.
Resources: Wikipedia.org, NPR.org, Bloomberg.com, aljazeera.com