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AP Explains: Standoff, sick economy drive Venezuelan crisis

Venezuela’s President Nicolas Maduro gestures as he delivers a speech at the World Energy Congress, in Istanbul, Monday, Oct. 10, 2016. (Emrah Gurel / Associated Press)
Associated Press

CARACAS, Venezuela – Venezuela is in the midst of an escalating political confrontation as the deeply unpopular socialist administration struggles to stay in power and a newly energized opposition tries to bring about change this year. President Nicolas Maduro and his supporters have blocked critics from staging a presidential recall referendum this year, and all but nullified the opposition-controlled congress. The opposition says the country has become a dictatorship, and is staging a series of mass street protests.

The Associated Press explains what’s next:

HOW DID THEY GET HERE?

The opposition scored a stunning landslide victory in legislative elections in December amid growing frustration with Maduro’s handling of the economy. Opposition leaders vowed to seek his ouster through constitutional means within six months but the government-stacked Supreme Court has stopped them at every turn.

The opposition made a recall referendum its chief priority for the year. But administration-friendly courts and electoral authorities blocked that campaign in late October. The opposition is staging a symbolic political trial of Maduro in Congress.

WHAT’S AT STAKE?

The big fear is a repeat of the riots and looting that rocked Caracas in 1989, leaving around 300 people dead. Another wave of anti-government unrest in 2014 resulted in more than 40 deaths and dozens of arrests.

Venezuela has one of the world’s highest homicide rates and the huge number of firearms circulating on the streets is a major concern in the event of unrest, as are the activities of armed motorcycle gangs that were once loyal to the government.

IS THE ECONOMY HEADING TOWARD COLLAPSE?

The economy is forecast to sink 8 percent this year and the International Monetary Fund forecasts inflation will soar to four digits next year. Foreign currency reserves have tumbled.

Oil accounts for 96 percent of Venezuela’s export earnings and the plunge in world oil prices hit the government hard, leaving it owing money across the board, from foreign airlines to oil service companies.

Rebounding oil prices, which are up around 60 percent this year after dipping to a 13-year low in January, could buy Maduro some time to try to fix the economy. So too could a new loan from China, but that seems unlikely as Venezuela’s biggest creditor has stopped providing new loans.

WHAT ARE MADURO’S OPTIONS?

Polls say 75 percent of Venezuelans want Maduro gone this year. But more than 20 percent still support him. In crisis-wracked Latin America, that is actually above the support for leaders in Brazil, Chile, Colombia and Peru. More importantly, Maduro still has a tight grip on almost every branch of government and institution, though support within his ruling socialist party is fraying.

The opposition is divided by some big egos and has a tough time connecting with the poor who still revere the late Hugo Chavez. Hardcore opposition members want more street protests, while moderates want more efforts to negotiate with the government for a transition of power.

IS THE MILITARY A FACTOR?

Venezuela’s military historically has been the arbiter of political disputes and some in the opposition are trying to spur them into action to resolve the current impasse. However, Chavez and Maduro have been skillful in winning over the top brass through patronage and powerful government jobs, and there is no outward sign of disgruntlement even at the junior levels.

One unanswered question is whether the military will be as quick to use heavy force in the event of mass street protests like it did during the anti-government unrest in 2014.

Associated Press