Case Study: Venezuela

Basic geography

• Borders Brazil, Columbia and Guyana

• 28 million people

• Capital city Caracas

Colonial Venezuela

Colonized by Spain for three centuries

Achieved independence in 1819

Venezuela Economy

Oil reserves estimated to be 500 billion barrels ; oil accounts for 90% of the country’s export earnings. (Half of oil exported to the U.S)

Rich in Iron ore, Gold, Bauxite, and Diamonds

Grows sugarcane, bananas, rice, coffee

Industry includes food processing, mining, textiles, and motor vehicle assembly

Economic development

Hugo Chaves came into power 1998, ran on a platform of social, economic, and political changes (Implemented socialism)

Higher priced oil

What policies did Chaves focus on

• Land Redistribution from wealthy landowners to poor peasants and small farmers

• Expanded educational opportunities for the poor (4 million students had access to meals)

• And enhanced health care

How did Chaves embrace state capitalism

• Increased government’s control of the economy

• Nationalized cement, petroleum, steel, electricity, and communication companies

• endangered support among the poor (made middle- and upper-class citizens feel alienated)

How did Chaves undermine democracy

• Discouraged opposition groups

• Diminished judicial independence

• concentrated executive power

• Used grassroots organizations to asphyxiate civil society

Other challenges to Venezuela development:

• Heavy dependency on oil exports

• Reliance on hydropower dams for 70% of its electricity

• Regional Problems have contributed to refugee crisis and drug-related violence

What did Chaves’s policies do

• Created friction between Venezuela and the U.S

• He suffered a coup attempt in 2002

• Cracked down on the opposition (Deepening political and social divisions)

• This led to the weakening of the economy (Exacerbated by the 2008-09 economic crisis)

Who replaced Hugo Chaves

• Nicholas Maduro (Income inequality remains a major challenge)

(Was incarcerated recently by the US)

• Interim President is Delcy Rodrigues