ICFAI LAW SCHOOL

ICFAI UNIVERSITY, DEHRADUN

ASSIGNMENT

ON

CRISIS IN VENEZULEA

SUBMITTED TO: - DIVYA TRIPATHI MAM

SUBMITTED BY: - HIMANSHU GOENKA

COURSE: - BA.LLB (HONS.)

ENROLLMENT ID: - 18FLICDDNO2053

SEC: -A

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TABLE OF CONTENT

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 INTRODUCTION

A socioeconomic and political crisis that began in Venezuela during the presidency of Hugo
Chavez has continued into the presidency of Nicolas Maduro. It is marked by hyperinflation,
escalating starvation, disease, crime and mortality rates, resulting in massive emigration from the
country. The situation is the worst economic crisis in Venezuela's history and the worst facing a
country that is not experiencing war since the mid-twentieth century.

It wasn’t that long ago that Venezuela Once considered the wealthiest country in Latin
America which possesses the world’s largest crude oil reserves, was a relatively stable
democracy with one of Latin America’s fastest-rising economies. It was a nation so awash
in petroleum revenues that the socialist government of the late former President  Hugo
Chavez spent huge amounts on social programs and, at one point, even  provided free
heating oil for impoverished Americans. But today, Venezuela is facing an unprecedented
economic and political crisis marked by severe food and medicine shortages.  In 2014, the
South American nation began suffering a startling collapse. With Venezuela’s  gross
domestic product plummeting even more than the United States during the Great
Depression, many of its nearly 32 million inhabitants became unable to afford food,
and resource-starved hospitals did not have enough soap and antibiotics. Venezuela's
economic woes are the fruit of years of economic mismanagement, and corruption, but
government supporters blame falling oil prices, international sanctions, and the country's
business elite for Venezuela's troubles. When global oil prices dropped in 2014, businesses were
no longer able to import goods at the same rate as before, skyrocketing prices and inflation.

According to analysts, the contraction of the national and per capita gross domestic product
(GDP) in Venezuela between 2013 and 2017 was more severe than that of the United States,
during the Great Depression, or Russia, and Cuba following the collapse of the Soviet Union,
heavily impacting the living conditions of millions.

POLITICAL SITUATION UNDER –

HUGO CHAVEZ - Hugo Chavez, a former lieutenant colonel in the Venezuelan military
who earlier led a failed coup attempt, is elected president, upending a political

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establishment that had controlled the nation for decades. Over the next decade and a half,
Chavez embarks on a massive social spending binge. To finance educational, health, food,
and housing programs for a population of over 30 million, the government redirected oil
profits to address pressing social inequality,” Tinker Salas explains. Chavez era social
programs, which significantly reduced poverty, nonetheless increased dependence on oil.

Though Chavez wanted to diversify the Venezuelan economy, his expensive strategy only
increased the dependence upon exported oil. Chavez also strives to build Venezuelan
influence, providing subsidized oil to Cuba in exchange for the services of Cuban doctors
and teachers. He sells oil to other South American countries and China at below-market
rates. At the same time, though, Chavez neglects to spend money maintaining oil facilities,
and production declines.

NICOLAS MADURO - After Hugo Chavez dies of cancer, he is replaced by his hand-
picked successor Nicolás Maduro, who won election by just 1.6 percentage points over
opponent Henrique Capriles, who unsuccessfully sought a recount. Muduro soon begins
consolidating his power, using authority given him by the National Assembly to  rule by
decree. But he isn’t able to halt the decline in oil prices that  pull down the Venezuelan
economy with it.

As Venezuela’s situation worsens the Maduro regime arrests opposition political

leaders and shuts down news websites and detains journalists, leading to  criticism from the
U.N. and the Inter-American Commission on Human Rights. In 2017, In May 2017,
President Maduro announced that he would convene a constituent assembly to revise the
constitution and scheduled July 30 elections to select delegates to that assembly. The Supreme
Court ruled that Maduro could convoke the assembly without first holding a popular referendum
(as the constitution requires)

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