Cooperative Responses To Venezuela's Crisis: A Roadmap For Negotiations

FRANCISCO RODRÍGUEZ • GIANCARLO BRAVO • GUILLERMO GUERRERO
Cooperative Responses
to Venezuela’s Crisis
A Roadmap for Negotiations
The photograph on our book’s cover was taken by Juan Carlos Hernández in Bahía de Pozuelos,
Anzoátegui, Venezuela, on September 16, 2019. The image captures a family walking on the beach at
sunset in the city of Puerto la Cruz with stalled oil tankers seen in the background.
Who We Are
Oil for Venezuela is a think tank that focuses on finding ways to address and prevent the deepening
of Venezuela’s humanitarian crisis. Our work centers on designing and advocating for initiatives that
allow the nation to use its own resources to address the most urgent problems affecting Venezuelans
today.
Our Team
Francisco Rodríguez, founder and director.
Giancarlo Bravo, head of research.
Luisa Elena García, researcher.
Jacques Bentata, researcher.
What We Do
We seek to think outside the box of the conventional wisdom that sees Venezuela’s problem as one
of political change. While recognizing that the country’s political actors hold diverse and often
diametrically opposed views on issues such as the political legitimacy of government and apportioning
of responsibilities, we seek to consider initiatives that make it possible for these actors to reach
common ground on mechanisms to resolve the most urgent needs of Venezuelans.
How We Do It
Instead of concentrating on thinking about what to do in Venezuela in a hypothetical “day after” that
may never materialize, we seek to focus efforts on thinking about what could be done for Venezuelans
in the concreteness of the here and now, assuming the current context of political confrontation as a
reality to be tackled and dealt with rather than imagined away.
Our Work
2019: A Humanitarian Oil Agreement for Venezuela: Protecting Venezuelans from the Collateral Impact
of the Political Crisis.
2020: US Sanctions on Venezuela: Alternatives to Maximum Pressure.
2021: Tackling Venezuela’s Humanitarian Crisis: Mobilizing Resources Through a Political Agreement.
2022: Sanctions, Economic Statecraft, and Venezuela’s Crisis.
Cooperative Responses to Venezuela’s Crisis:
Francisco Rodríguez, Giancarlo Bravo, Guillermo Guerrero.
Cooperative Responses to Venezuela’s Crisis: A Roadmap for Negotiation
OIL FOR VENEZUELA, INC. United States, 2023.

ISBN 13: 979-8-9892033-6-9.
Subject: Economics.
Subject: Social Science.
All rights reserved. No part of this publication may be reproduced, stored in a retrieval system,
or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, or
otherwise, without the prior written permission of the copyright owner.
ALL RIGHTS RESERVED.

© 2023 OIL FOR VENEZUELA, INC.
2578 Broadway #698.
New York, NY 10025-8844 (United States).
Francisco Rodríguez, Giancarlo Bravo, Guillermo Guerrero.

Cooperative Responses to Venezuela’s Crisis: A Roadmap for Negotiations
ISBN 13: 979-8-9892033-6-9.
Cover’s photography: Juan Carlos Hernández.

Cover’s design: Virginia Pérez.
Interior design: Sofía Casini.
Printed by: SmartPress.
Printed in United States.
https://en.oilforvenezuela.org/
Cooperative Responses to Venezuela’s Crisis:
Francisco Rodríguez, Giancarlo Bravo and Guillermo Guerrero
October 2023
About the authors
Francisco Rodríguez is the founder and director of Oil for Venezuela. He is the Rice Family
Professor of the Practice of International and Public Affairs at the University of Denver’s Josef
Korbel School of International Studies. He is the author of numerous academic articles and
books on Venezuelan and Latin American economics, economic development, international
economics and political economy.
Giancarlo Bravo is the head of research of Oil for Venezuela. He holds a BA in Economics from
the Central University of Venezuela and has led various projects focused on the analysis of
the Venezuelan economy. His main areas of research interest are political economy, economic
growth, economic development, and climate economics.
Guillermo Guerrero is a senior strategist at EMFI Analytics, where he focuses on fiscal and
external sustainability, economic crises and debt restructuring operations in emerging and
frontier markets. He holds a BA in Economics from the Universidad Católica Andrés Bello
and is a CFA Charterholder. In addition to his work in financial markets, he has contributed to
policy research that seeks to understand and address the Venezuelan crisis.
Acknowledgements
This publication is the product of a years-long research effort aimed at understanding the
scope for cooperative initiatives in addressing Venezuela’s complex humanitarian and econo-
mic emergency. This work has been made possible by generous support from the Open So-
ciety Foundation’s Latin America Program. Our research has benefitted from substantial in-
puts from a multidisciplinary team of researchers that included Jacques Bentata, Simón Call,
Arnaldo Espinoza, Luisa Elena García, Camille Rodríguez, María José Rodríguez, Verónica
Regardiz and Adolfo de Lima. All and any errors are the sole responsibility of the authors.
Contents
Foreword 12
Executive Summary 14
Chapter 1: The Humanitarian Crisis in Context 23

The Worst Economic Disaster in Peacetime 27
The Economic Roots of the Humanitarian Crisis 29
The Economic Effects of the Recognition Crisis 31
The End of the Interim Government and its Implications for our Proposals 33
The Role of Sanctions in the Economic Crisis 36
Cooperative Agreements for Venezuela 40
Where We Stand Today 40
Negotiated Agreements Against the Backdrop of Political Conflict 41
Recommendations 43
Chapter 2: International Policy and the Venezuelan Crisis 49

The Refugee Crisis 51
The Policy Response 52
Recommendations 55
Humanitarian Aid 58
Depoliticizing Foreign Aid 61
Precedents in Cooperative Agreements to Facilitate International Aid 62
Recommendations 64
Sanctions as a Policy Tool 65
Effectiveness of Sanctions in Achieving their Objectives 66
Collateral Damage to the General Population 69
Recommendations 75
Chapter 3: Oil-for-Essentials Initiatives 79

The Collapse in the Venezuelan Oil Industry 80
Explaining Declines and Quantifying the Room for Recovery 83
Precedent: The UN’s Oil-for-Food Programme in Iraq 91
5
Oil for Venezuela: A Humanitarian Oil Agreement for Venezuela 94
Boston Group: Venezuelan Oil Sale Mechanism for the Execution of Humanitarian Projects 96
Atlantic Council: Exploring Humanitarian Frameworks for Venezuela 97
OFAC Licensing and Partial Agreements 100
Comparison of Different Oil-for-Essentials Initiatives 104
Recommendations 106
Chapter 4: Accessing Multilateral Cooperation and Blocked Funds 113

The Venezuelan Legitimacy Crisis and the Control of Assets 115
The Road Ahead 117
The Fund for the Afghan People 118
Existing Liquid Funds in Offshore Bank Accounts 122
Potential Financing from International Financial Institutions 127
The International Monetary Fund (IMF) 129
The World Bank Group (WB) 133
The Inter-American Development Bank (IADB) 135
The Andean Development Corporation (CAF) 136
Where to Direct Multilateral Funds 137
Boston Group Proposal for the Electricity Generation Sector 140
The Oil for Venezuela Proposal 141
General Discussion 146
Decentralized Boards 148
Recommendations 149
Chapter 5: Asset Protection 157

The Framework and Implications of Sovereign Immunity 158
Venezuela’s External Assets 162
Venezuela’s External Liabilities 164
Creditor Efforts to Attach Venezuelan External Assets 167
The Grounds for Alter Ego Determinations 173
Political Conflict and the Defense of External Assets 175
The Protection of Venezuelan Foreign Assets 177
Recommendations 179
A Cooperative Solution to Manage External Assets and Legal Defenses 179
Renegotiating the Most Urgent Claims Against CITGO 181
6
Attending the Crisis Beyond the Urgent 184
Chapter 6: Rethinking Policy and Negotiations Design 189

Politicization of Social Programs 190
The Fatherland Card and CLAP Food Boxes 191
Evidence on the Reach of the CLAP Program 194
Assessing Political Bias in Venezuelan Social Programs 198
Recommendations 203
When and Why Negotiations Fail and What to do About It 203
Broadening Political Negotiations 206
Conclusion: Cooperation as a Way Forward 209
References 214
List of figures
Figure 1. Venezuela’s real per capita GDP and real per capita oil exports, 2003-2022 24
Figure 2. Prevalence of undernourishment, 2000-2020 (% of population) 25
Figure 3. Food Imports, 2012-2020 32
Figure 4. Ratio of total funding to HRP funding requirements, Venezuela 58
Figure 5. Funding by source, Venezuela 59
Figure 6. Venezuela’s oil production (OPEC Secondary Sources, TBD) 82
Figure 7. Iraq’s oil production , 1987-2014(TBD) 88
Figure 8. Iran’s oil production, 2010-2019 (TBD) 89
Figure 9. Syria’s oil production, 2008-2022 (TBD) 90
Figure 10. Libya’s oil production, 2010-2012 (TBD) 90
Figure 11. PDVSA organization chart 164
Figure 12. Public external debt (USD bn) 165
Figure 13. Food- related government program beneficiaries, 2014-2021 195
Figure 14. Receipt of CLAP packages by frequency, 2017-2022 (% of households) 196
Figure 15. Received CLAP packages in past and last month, 2016-2022 197
7
List of tables
Table 1: Summary of proposals by objective 15
Table 2: FAO Food Balance Sheets (in metric tons), 2010 – 2019 26
Table 3: Largest per capita GDP collapses, constant-price GDP 28
Table 4: Stock of Venezuelan immigrants per country, 2015-2022 52
Table 5: Entry requirements for Venezuelans in selected host countries, 2015 vs 2022 53
Table 6: Comparison of OCHA HRP for recent humanitarian crises in 2022 60
Table 7: Summary of cross-country panel data and country-level studies 71
Table 8: Transactions forbidden by Executive Order 13808 80
Table 9: Survey of the estimated impact of sanctions on oil production 85
Table 10: Estimated gains from lifting oil sanctions 87
Table 11: Main characteristics of the program 95
Table 12: Comparison of different Oil-for-Essentials proposals 105
Table 13: Liquid funds unavailable due to the political crisis or US sanctions 125
Table 14: Potentially available multilateral financing, conservative estimate. 128
Table 15: Recognition of Venezuelan authorities at multilateral development banks by shareholder votes 128
Table 16: Conditions and requirements for existing IMF funding options (part 1). 129
Table 17: Conditions and requirements for existing IMF funding options (part 2). 130
Table 18: Estimated total value of offshore Venezuelan assets. 163
Table 19: Partial identification of Venezuela’s current external public debt in 2022 (USD mn). 166
Table 20: Venezuela’s and PDVSA’s debt to creditors legally entitled to seize assets of the latter in the U.S. 171
Table 21: CLAP package beneficiaries by political self-identification 199
Table 22: Fatherland Card transfers beneficiaries by political self-identification 199
Table 23: COVID vaccines beneficiaries by political self-identification 199
Table 24: Periodicity of reception of CLAP food boxes by political affiliation 202
Table 25: Reported conditioning by respondent who received CLAP food boxes 202
Table 26: Varieties of initiatives to reduce stakes of power 208
8
Acronyms
2015AN ��National Assembly elected in 2015

2020AN ��National Assembly elected in 2020
AD ��Acción Democrática
AMC��Advance Market Commitment
BCV�� Banco Central de Venezuela
BIS ��Bank for International Settlements
CAF��Corporación Andina de Fomento
CLAP�� Comités Locales de Abastecimiento y Producción
CNE�� Consejo Nacional Electoral
DPF ��Development Policy Financing
ECF �� Extended Credit Facility
EFF��Extended Fund Facility
EIA�� Energy Information Administration
ENCOVI �� Encuesta Nacional de Condiciones de Vida
FAO��Food and Agriculture Organization
FARC�� Fuerzas Armadas Revolucionarias de Colombia
FBS�� Food Balance Sheets
FCL ��Flexible Credit Line
FONDEN �� Fondo de Desarrollo Nacional
FSIA�� Foreign Sovereign Immunities Act
GDP�� Gross Domestic Product
GE�� General Electric
GL 41��General License 41
GNI�� Gross National Income
GSDB ��Global Sanctions DataBase
HMG�� Her Majesty’s Government
HRP��Humanitarian Response Plan
HRW��Human Rights Watch
IADB�� Inter-American Development Bank
IBRD�� International Bank for Reconstruction and Development
9
ICC �� International Criminal Court
ICSID �� International Centre for Settlement of Investment Disputes
IDA ��International Development Association
IFC�� International Finance Corporation
IFI�� International Financial Institutions
IMF �� International Monetary Fund
IPF ��Investment Project Financing
MDB ��Multilateral Development Bank
MUD��Mesa de la Unidad Democrática
Metor�� Metanol de Oriente
MIGA ��Multilateral Investment Guarantee Agency
NATO�� North Atlantic Treaty Organization
NGO�� Non-governmental organization
NOC��National Oil Company
OFAC ��Office of Foreign Assets Control
OFFP��Oil-for-Food Program
OPEC �� Organization of the Petroleum Exporting Countries
OVSP ��Observatorio Venezolano de Servicios Públicos
PAHO�� Pan-American Health Organization
PDVAL ��Producción y Distribución Venezolana de Alimentos
PDVSA ��Petróleos de Venezuela, S.A.
PforR �� Program-for-Results
PJ��Primero Justicia
PLL�� Precautionary and Liquidity Line
PROVEA ��Programa Venezolano de Educación Acción en Derechos Humanos
PPP �� Purchasing Power Parity
PU �� Plataforma Unitaria
PWT ��Penn World Table
RCF��Rapid Credit Facility
RFI �� Rapid Financing Instrument
SBA �� Stand-by Agreements
SCF ��Stand-by Credit Facility
SDN��Specially Designated Nationals
SDR �� Special Drawing Right
SFV ��Special Financing Vehicle
10
SLL �� Short-Term Liquidity Line
SPV �� Special Purpose Vehicle
TBD ��Thousand barrels per day
TIES ��Threat and Imposition of Economic Sanctions
TSC ��Targeted Sanctions Consortium
UN �� United Nations
UN IGME �� United Nations Inter-agency Group for Child Mortality Estimation
UN OCHA �� United Nations Office for the Coordination of Humanitarian Affairs
UNAMUJER ��Unión Nacional de Mujeres
UNDP ��United Nations Development Programme
UNHCR�� United Nations High Commissioner for Refugees
UNSC �� United Nations Security Council
UNT ��Un Nuevo Tiempo
VWG ��Venezuela Working Group
VP �� Voluntad Popular
WB ��World Bank
WFP �� World Food Program
11
Foreword
Venezuela is entering the second decade of a protracted economic, political and humanitarian crisis among
the worst ever seen by any nation in contemporary history. This economic and social collapse has obliterated
the opportunities of a generation of Venezuelans. While the driving dynamics that led to it are sure to be the
focus of debate among scholars for decades to come, the moral imperative to do something to alleviate the
suffering of millions of vulnerable Venezuelans requires rapid and decisive action.
Since 2019, the prevalent thinking in the international and policy communities has prioritized the design
of policy solutions that would be implemented after a political transition, as well as the mobilization of as-
sistance to emigrant populations, alongside efforts to generate domestic political change. Regrettably, these
efforts have proved insufficient, ineffective, and at times even counterproductive, in helping overcome the
deep deterioration in living conditions suffered by Venezuelans.
Since its creation in 2019, Oil for Venezuela has tried to think outside the box of the conventional wisdom
that sought to address Venezuela’s problem as one of political change. While recognizing that the country’s
political actors hold diverse and often diametrically opposed views on issues such as the political legitimacy
of government and the apportioning of responsibilities for the impairment of basic political and human
rights, we seek to consider initiatives that make it possible for these actors to reach common ground on
mechanisms to resolve the most urgent needs of Venezuelans. Instead of concentrating on thinking about
what to do in Venezuela in a hypothetical “day after” that may never materialize, we sought to focus efforts
on thinking about what could be done for Venezuelans in the concreteness of the here and now, assuming the
current context of political confrontation as a reality to be tackled and dealt with rather than imagined away.
We have not been alone in this endeavor. Numerous Venezuelan and international civil society groups,
academics and policy advocacy groups, among others, have made similar calls. In late 2022, an important
milestone was reached as the government and mainstream opposition agreed in principle for the creation of
a humanitarian fund that would use previously frozen assets to increase social expenditure. Nevertheless, as
of this writing, the initiative has yet to be operationalized. The difficulties involved in the creation of this
fund suggest that it is necessary to continue to devote efforts to understanding how to overcome the concrete
political, administrative, financial and legal impediments to the implementation of cooperative solutions to
address the concrete and urgent problems of Venezuelans.
Cooperative Responses to Venezuela’s Crisis is our attempt to contribute to the search for viable solutions
12
to these problems by consolidating existing knowledge and proposals to address Venezuela’s crisis within a
framework of cooperation among the country’s political and non-political stakeholders. This book is intend-
ed as a compendium of proposals made by scholars, policy experts and civil society organizations to address
the deprivations suffered by vulnerable Venezuelans through agreements between the parties to the country’s
political conflict. In this volume, we have sought to put together what we know – as well as identify what we
need to know – regarding the design of policy initiatives that could be put forward to address the country’s
most pressing problems through the cooperation of the groups that currently vie for control of political
power.
Accepting the need for cooperative proposals in no way implies that political actors would need to put
aside their efforts to generate a political and institutional change that is aligned with their vision of a just and
free society. On the contrary, we write from a basic premise of respect for the deeply held belief that many
Venezuelans involved in political activity on opposite sides of the country’s ideological spectrum have regard-
ing the rightness of their claims. It is precisely because we are cognizant of the depth of the commitment to
their ideals among many of the country’s political actors that we believe that a way forward can be found in
seeking common ground to help identify and implement concrete solutions that address the urgent needs
and concerns of vulnerable Venezuelans. Turning cooperation into reality does not require abandoning the
political ideals held on either side of the country’s political divide. Rather, it requires recognizing the moral
imperative of putting the well-being of Venezuelans at the front and center of any agenda for change.
Francisco Rodríguez
Director and Founder
Oil for Venezuela
13
Executive Summary
The Roots of the Venezuelan Humanitarian Crisis
Between 2012 and 2020, Venezuela’s real per capita GDP contracted an astonishing 72%, marking one of the largest
economic catastrophes in modern history and a humanitarian crisis with little precedent in the Western Hemisphere.
While per capita economic activity rebounded an accumulated 14% between 2020 and 2022, there are significant
reasons to believe this recovery will not prove sustainable in the mid-term if it is not accompanied by a radical change
in Venezuela’s internal and external conditions.
Despite the recent moderate recovery in economic activity, the population remains in a profoundly vulnerable
position and inequality has continued to worsen. Data produced by a national survey of living conditions developed
by a consortium of national universities and NGOs, ENCOVI, shows that multidimensional poverty rose from 39%
in 2014 to 51% in 2022. Poverty by income similarly rose from 48% in 2014 to 82% in 2022, while extreme poverty
went from 24% to 53% in the same period. Key social indicators in areas such as education, health and nutrition show
a similar deterioration. ENCOVI also estimates that the Gini Coefficient for Venezuela has risen to 0.603, up from
0.407 in 2014, placing the country as the most unequal in the continent and one of the most unequal in the world.
At the root of Venezuela’s economic and humanitarian crisis is the collapse of its external revenues. Between 2012
and 2020, the volume of oil production and oil exports fell respectively by 79% and 76%, with oil export revenue fall-
ing by an even larger 93% due to the additional effect of declining oil prices. The U.S. imposition of financial sanctions
in 2017 and trade sanctions in 2019 – and the uncertainty over the international community’s recognition of Vene-
zuela’s authorities – contributed to this decline by isolating Venezuela from some of its natural markets and preventing
the country from seeking support from multilateral financing institutions.
The economic and political crisis is itself a consequence of institutional arrangements that create perverse incentives
for destructive confrontation in the context of a zero-sum distribution of political gains. To overcome these perverse
incentives, this volume proposes and documents cooperative solutions to Venezuela’s economic and humanitarian cri-
sis that aim both to address the immediate effects of the crisis and to foster the development of institutions that allow
the parties in the conflict to resolve their disputes in a less destructive manner.
We organize our analysis and proposals to tackle the humanitarian crisis in five blocks covering international policy
towards Venezuela, initiatives to ease trade sanctions and fund humanitarian programs, ideas to deploy existing exter-
nal liquid assets and potential multilateral financing, how to protect Venezuela external assets from the threat posed
by litigating creditors and how to ingrain existing domestic policy initiatives in a cooperative framework that provides
additional funding and helps refine their operations.
14
Table 1: Summary of proposals by objective
Chapter Proposal Proponent Description
Refugee crisis
Summary of Facilitate the integration of migrants in host economies by:
Formalize undocumented recommenda- - Reworking regularization frameworks to expedite the issuance of work permits
2
migrants at host countries tions by multiple - Re-evaluating legal restrictions on the participation of foreigners in the labor market
authors - Facilitating the accreditation of professional skills and the attainment of professional licenses
Redesign migration
Rodríguez Guarantee migrants the expedient and safe access refugee status and reduce unfair penalties
2 strategies for refugees at
(2022g) and disadvantages for vulnerable groups
host countries
Humanitarian aid
- Depoliticize the operation of aid distribution and government engagement with NGOs and
Summary of international organizations
Depoliticize humanitarian recommenda- - Revise OFAC policy to mitigate the negative effects of overcompliance on NGO operations in
2
aid tions by multiple
the country
authors - Improve public engagement by NGOs and the international community to attract higher
donations
Reclassification of Re-evaluating the classification of Venezuela as a high-middle income country to facilitate the
Maldonado and country’s application to international aid, debt relief mechanisms, and other forms of foreign
2 Venezuela as a low-middle
Olivo (2022) assistance
income country
Sanctions / Oil industry
Reevaluation of sanctions Rodríguez Conduct a thorough cost-benefit analysis of the current sanctions regime by weighing its impact
2
regime (2023a) on the population against its perceived benefits
Conditional lifting of oil sanctions to reestablish access to the U.S. market for Venezuelan oil
Humanitarian Oil Agree- Oil For Venezuela exports. Direct proceeds of increased hard currency inflows to fund humanitarian programs
3
ment for Venezuela (2019) coordinated by copperative board with representation of the parties in the political conflict
under the supervision of the international community
Venezuelan Oil Sale
Conditional lifting of oil sanctions to regain access to the U.S. market and direct proceeds of
Mechanism for the Exe- Boston Group
3 increased exports to humanitarian programs coordinated by the parties in the local political
cution of Humanitarian (2021)
conflict under the supervision of the international community
Projects Through the UN
U.S. government
3 Oil-for-debt agreements Partial flexibilization of oil sanctions conditional on repayment of private debt
policy
Past U.S. govern- Partial flexibilization of oil sanctions to fund swaps for oil products needed by the Venezuelan
3 Oil-for-product swaps
ment policy economy
Deployment of multilateral financing and existing liquid assets
Proposal for the Electrici- Boston Group Enable Venezuela to borrow USD 350 mn from CAF to rehabilitate the electricity generation
4
ty Generation Sector (2019) infrastructure in projects coordinated by the UNDP
Tackling Venezuela’s Oil for Venezuela Creation of consensus governing boards to enable Venezuela to employ existing liquid assets
4
Humanitarian Crisis (2021) and potential multilateral financing for humanitarian programs
Asset protection
Partial flexibilization of oil sanctions conditional on repayment of private debt with priority
3 Oil-for-debt agreements Oliveros (2020)
creditors that pose a threat to Venezuela’s external assets
Asset Protection and Current 2015AN
5 Creation of a board for the management and protection of existing Venezuelan assets
Administration Board policy
A Cooperative Solution to Creation of a cooperative board for the management and protection of existing Venezuelan
5 Manage External Assets Authors assets. Especial attention to the management of risks relating to the violation of the separate
and Legal Defenses corporate identity of Venezuela State Owned Enterprises
Renegotiating the Most Evaluating the renegotiation of priority debts that pose a direct threat to Venezuela’s ownership
5 Urgent Claims Against Authors of CITGO under a cooperative design that incorporates the parties in the Venezuelan political
CITGO conflict
Reevaluation of existing policy
- Redesigning existing social programs by removing elements that lead to their politicization
Depoliticization of exi- - Increasing funding available to existing social programs by implementing cooperative schemes
6 Authors
sting social programs that enable the increase of oil exports and the funneling of existing foreign currency deposits
and potentially-available financing
Shifting the focus of existing political negotiation to address their zero-sum setup by expan-
Broadening political Rodríguez
6 ding the topics subject to negotiation, broadening political representation and incorporating
negotiations (2023b)
non-political stakeholders
Source. Own elaboration.
15
International Policy and the Venezuelan Crisis
Venezuela’s economic catastrophe has led to a massive population exodus, with migrants turning to neigh-
boring and distant countries seeking refuge. At least 6.4 million Venezuelans have fled the country since
2017; when combined with previous migrants, the total number of Venezuelans abroad reached 7.2 million
persons by the end of 2022, a whopping 23% of the country’s population in 2015, when the crisis started.
This wave of migrants was initially well received in the region but, as the number of people arriving grew
relative to the native population, many countries have experienced an upsurge in anti-immigration senti-
ment. As a response, governments across Latin America have increasingly attempted to curb migration by
imposing increasingly stringent migration requirements, despite political declarations of support for Vene-
zuelan migrants at the regional level.
Venezuelan migration has also turned into a topic of political conflict within U.S. politics. In response,
the Biden administration announced a new process to grant legal entry and temporary residency to 24,000
Venezuelans in the U.S., conditioned on finding a sponsor able to provide for them, while restricting asylum
seekers in the border. The decision discriminates against those migrants most in need and curtails their right
to seek asylum.
Economic research on immigration has shown significant medium-term benefits that can outweigh the
short-term costs associated with increased inflows. These can be leveraged integrating Venezuelans into for-
mal labor markets by implementing a broad range of policy changes, going from reworking regularization
frameworks to expediting the issuance of work permits, reevaluating legal restrictions on the participation of
foreigners in the labor market, and facilitating the accreditation of professional skills and the attainment of
professional licenses.
While the economic crisis is a result of Venezuela’s decreased capacity to export, the international response
to the Venezuelan crisis, as embodied in humanitarian aid, has also been lackluster. The office coordinating
this response – the United Nations Office for the Coordination of Humanitarian Affairs (UN OCHA) –
has been chronically underfunded. In fact, total international assistance since the start of the crisis has barely
reached USD 1.1 bn, or a meager USD 41 per capita. By comparison, donors have directed USD 24 billion,
or nearly USD 1,300 per capita, to Syria, a country that has seen a smaller collapse in per capita income than
Venezuela.
Depoliticizing humanitarian aid in Venezuela is crucial for ensuring that assistance reaches those in need with-
out interference by political interests in the highly polarized context of the Venezuelan crisis. This requires a firm
commitment by all stakeholders to put the needs of Venezuelans above politics. For aid to become more effective,
it must be distributed based on need, rather than political affiliation. International organizations and domestic and
foreign NGOs can have a significant role in ensuring depoliticized and transparent distribution. Securing more
funding is also critical and cooperative arrangements can help address the barriers for international assistance.
16
However, while an increase in the flow of humanitarian aid could do much to alleviate the suffering of
vulnerable groups in the country, unlocking aid should not in and of itself be seen as the cure to Venezuela’s
humanitarian crisis. Aid is not meant to substitute for a nation’s economy but rather to provide concrete
assistance to persons and groups facing situations of extreme vulnerability. It is difficult to marshal the re-
sources needed to confront a crisis caused by the collapse of oil exports through a system of assistance based
on donations.
To rehabilitate the Venezuelan economy, its partial exclusion from international trade and financial mar-
kets must be addressed. This implies a thorough rethinking of sanctions policy. While sanctions have become
increasingly prevalent in recent decades as a tool of foreign policy, there is a growing awareness of their
significant negative collateral impacts on the populations of targeted countries. Such impacts are reflected
in lower growth, higher likelihood of economic collapses, increases in poverty and inequality, worsening
health conditions, substantial excess deaths, and deteriorations in human rights and democracy. These effects
should be a primary concern in the case of an economy with the structural weaknesses and vulnerabilities to
external conditions of Venezuela’s.
There is also an extensive literature that puts into question the effectiveness of sanctions in procuring their
stated aims. Some studies have found evidence that sanctions may in some cases have the opposite effect to
that desired. Sanctions can strengthen a targeted regime if they lead to situations in which the authoritarian
regimes can blame external actors for the country’s economic problems, leading to increased nationalism and
a “rally-round-the-flag” effect. This has arguably been the case in Venezuela, where the Maduro administra-
tion has highlighted the role of sanctions on the country’s economic crisis, while the mainstream opposition
became overly reliant on external pressure as its main political tool, at times abandoning elections and even
grassroots organizations.
Given the ineffectiveness of sanctions on Venezuela in the four years since their imposition, a reevalua-
tion of their cost/benefit is crucial. Reforming the sanctions regime in place requires a careful and honest
evaluation of the costs and potential rewards of the existing framework that is based on the best available
scholarly work on the subject and tackles some of the most crucial mistakes incurred over the past few years.
Oil-for-Essentials Initiatives
The root of Venezuela’s crisis lies in its reduced capacity to generate foreign currency inflows to finance the
imports that sustain its economy. While many factors, including deficient economic policy and vulnerability
to external shocks, played a role in the collapse of Venezuelan revenues, the partial international isolation
resulting from the political conflict and sanctions had a key role.
Venezuela’s oil sector output fell 65% since 2016, which translates to USD 36 bn per year in lost revenues
17
at current prices, between two and three times our estimate for Venezuela’s total imports in 2022. There is a
growing consensus among researchers that sanctions have played an important role as one of the causes of the
decline as well as by preventing any possible recovery.
Financial sanctions imposed in 2017 barred the country’s access to international financial markets, re-
stricting the operation of some financing mechanisms that remained active at the time and preventing the
country from even attempting to restructure its foreign debt. Trade sanctions imposed in 2019 then shut
Venezuela from access to its natural market in the U.S., both as a destiny for its exports and as a source of
petroleum products that are key to refining Venezuelan crude.
There are reasons to believe that oil production could recover significantly from its current levels under
an oil-for-essentials program or a direct unconditional lifting of sanctions that allows Venezuela to regain
access to the U.S. oil market. Part of this evidence comes from previous experience with sanctioned countries
in which data shows a very large drop in oil production in the months after sanctions are implemented and a
very quick recovery once they are lifted or relaxed.
In recent years, several proposals to loosen these restrictions in the context of humanitarian frameworks
have emerged in public discussion. At their core is the idea of permitting Venezuela to regain access to these
barred markets under the condition that proceeds are funneled to humanitarian initiatives. The various pro-
posals incorporate different combinations of domestic cooperation and international community supervi-
sion and also differ significantly in their scope.
Broadly speaking, existing oil-for-essential initiatives can be grouped into two types: those that advocate
for a broad-based licensing arrangement and those that target only exceptional, specific, deals. In the former
category, the Oil for Venezuela foundation put forth a proposal in 2019 under which the political parties in
dispute in the Venezuela conflict would cooperate by agreeing on a program design for a broad lifting of oil
sanctions to fund humanitarian initiatives coordinated by a board composed of both sides to the political
conflict and operating under international supervision. On the other end, the U.S. Office of Foreign Control
Assets (OFAC) licensing agreements for individual foreign companies to perform oil-for-debt swaps with
Venezuela’s state-owned company Petroleum of Venezuela (Petróleos de Venezuela, PDVSA) are the most
modest alternative.
Smaller and more limited programs can serve as a first step to help build confidence for a more complex
design and can also provide insights into design strengths and shortcomings. However, some initiatives pre-
sented in the policy debate have sought to explicitly avoid the complexities of larger scale programs, often
in the belief that only small programs will be needed while a broader solution to the political crisis is sought
– or, alternatively, due to a presumed lack of political will to design and implement a larger scale program.
An obvious danger of this approach is that the programs that end up being implemented may end up locking
in an institutional structure that is not well designed to tackle the depth and complexity of the country’s
economic and humanitarian crisis.
18
Regardless of the specific mechanisms chosen to implement an oil-for-essentials initiative, we be-
lieve that a program should put humanitarian considerations at the heart of design and abandon
the temptation to use them as a bargaining chip for electoral negotiations that foster an adversari-
al attitude among the parties. Instead, the program should aim to foster trust in the commitment
of the parties to coexist within the country by putting the necessities of its population at the forefront.
Accessing Multilateral Cooperation and Blocked Funds
Venezuela has been in a devastating economic and humanitarian crisis for almost a decade. The country has
not undertaken a comprehensive economic overhaul to address the structural issues generating the crisis and
has been unable to access multilateral support. The most crucial impediment to Venezuela’s ability to restruc-
ture its debt, access its financial holdings and seek multilateral assistance is its unique situation in terms of
international recognition due to the divergence of views in the international community over the legitimacy
of the Nicolás Maduro administration.
The Venezuelan political crisis escalated in 2019 as Nicolás Maduro was sworn in for a second presidential
period in the wake of the 2018 presidential elections, which were not recognized by the opposition and a
large part of the international community. While Maduro took the oath of office before the nation’s supreme
court, instead of the conventional Congressional venue, National Assembly President Juan Guaidó claimed
the competencies of the executive under the position of interim president of Venezuela with the backing of
the National Assembly elected in 2015 (2015AN).
Upon Guaidó’s declaration, the U.S. and 57 other countries recognized him as interim president and the U.S.
State Department followed up by transferring control of the Venezuelan government’s assets in their territory to
the Guaidó administration. This resulted in competing claims over the Venezuelan Presidency, which extended
into competing claims at other institutional levels, including the representation of the Central Bank of Venezuela
(Banco Central de Venezuela, BCV) governing board and in similar instances that claim control over the foreign
assets of several Venezuelan state-owned enterprises, including PDVSA. The International Monetary Fund (IMF)
and World Bank (WB) took the position of recognizing no government in the absence of consensus on recog-
nition among its members, while the Inter-American Development Bank (IADB) recognized Guaidó and the
Andean Development Corporation (Corporación Andina de Fomento, CAF) continued to recognize Maduro
despite reducing its engagement significantly.
The recognition crisis has prevented Venezuela from employing existing foreign currency deposits abroad and
the support of multilateral development banks to attend the humanitarian crisis. We estimate that USD 14 bn in
existing deposits and USD 9 bn in multilateral financing would become available if these problems were resolved.
Since 2019, several proposals have emerged to deploy these funds. The Boston Group proposed contracting a
19
loan of up to USD 350 mn from CAF to address the severe electricity generation shortage in the country. The Oil
for Venezuela foundation took a broader approach, developing a framework under which the parties in the conflict
would negotiate the appointment of consensus governing instances to manage external deposits and the relation-
ship with multilateral financing institutions.
A broad-based political negotiation resulting in consensus governing instances has a high-
er potential to impact the Venezuelan humanitarian crisis. However, it is paramount that the pro-
cess of disbursing funds be done in a way that prevents slippage to corruption and the assignment
of resources for political gain. Allocation of resources should carefully consider both the short-term
potential to alleviate the suffering of some of the most vulnerable segments of the population, as
well as investment to rehabilitate key infrastructure for the provision of utilities that feeds into hu-
manitarian outcomes directly but also enables economic growth and development more broadly.
Asset Protection
Venezuela has been left exposed to substantial litigation in foreign jurisdictions due to the prolonged default
on its external debt and past nationalizations. Major claimants include litigation creditors, such as the Cana-
dian mining company Crystallex and the U.S. oil company ConocoPhillips, as well as commercial creditors
in possession of the country’s dollar-denominated Eurobonds. Compounding this issue, some creditors have
already undertaken legal action to recover from the country’s external assets and, in some cases, have been
successful in seizing Venezuelan government property. The most important of these actions is an ongoing le-
gal process in which a U.S. court is planning to hold an auction to sell Venezuela’s most valuable asset abroad,
CITGO, in order to satisfy creditors.
A major medium-to-long term challenge to Venezuela’s recovery is the protection of the country’s state-
owned foreign assets. We estimate Venezuela’s public debt at USD 154 bn (135% of GDP) and the country’s
external assets at USD 22 bn. The latter includes public companies based in foreign jurisdictions, as well as
sizeable bank accounts to the name of the country’s central bank and several subsidiaries of PDVSA. In addi-
tion to existing asset stocks, the country also generates significant foreign-currency inflows arising from the
operation of its oil industry. We estimate that Venezuela’s oil exports were of USD 21 bn in 2022 and that the
inflows will rise to USD 23 bn in 2023 as U.S. restrictions on the import of Venezuela oil are relaxed, which
means humanitarian efforts to alleviate the crisis must account for their protection from aggressive creditors.
Sovereign creditors have naturally limited recourse to debtor assets when the latter defaults on its debt. A
first limitation is that sovereign states usually hold the vast majority of their assets within their own territo-
ry, where courts are often reluctant or legally barred from permitting creditors to seize them. With respect
to assets held abroad, most jurisdictions provide strong protections through sovereign immunity and even
20
stronger protection for central bank assets.
However, assets employed for commercial purposes are generally not protected by sovereign immunity.
Since a significant part of Venezuela’s external assets are owned by PDVSA and the company generates most
of its external inflows, this institutional framework leaves the Venezuelan public sector under considerable
exposure to foreign litigation.
In principle, PDVSA creditors are able to seek the attachment of CITGO, but creditors of the Republic
are prevented from doing so by the principle of limited liability. However, this barrier is not impenetrable
and has been breached in some cases through a legal doctrine called alter ego. A recent judicial decision
found that both the Maduro and Guaidó administrations had treated PDVSA as their instrumentality and
granted conditional writs of attachment on CITGO to a number of creditors with judgement against Vene-
zuela, on the basis of the alter ego doctrine.
While U.S. sanctions continue preventing most transfer of property owned by the government of Venezu-
ela, including for the purposes of creditor relief, the U.S. government has indicated in correspondence to the
court that it would have a favorable licensing policy for the finalization of the sale of CITGO for the benefit
of creditors.
In this context, we argue that Venezuelan political forces should prioritize negotiating with creditors in
advanced stage of litigation to prevent the loss of CITGO. We also believe that it is paramount to mitigate
the factors that have enabled creditors to successfully argue that PDVSA is an alter ego of the Republic. This
could be done through the appointment of an Asset Management Board as a result of negotiation by the
various political factions and non-political stakeholders in the country. The board would be integrated by
representatives of the political parties themselves and non-partisan civil society members with proven exper-
tise in key areas of public policy, international litigation, and finance.
Rethinking Policy and Negotiations Design
The use of social programs to reward or gain political support for the ruling party has been a pervasive insti-
tutional problem in Venezuelan history. While social programs have evolved considerably over the years, the
Fatherland Card (Carnet de la Patria) and the Local Supply and Production Committees (Comités Locales
de Abastecimiento y Producción, CLAP) food boxes play predominant roles in the provision of social assis-
tance. Both programs have been the subject of considerable political controversy amid frequent accusations
of politization.
The Fatherland Card is a government-issued card entitling the holder to receive cash transfers. Eligibility
for the card is open to all Venezuelan citizens who hold a national ID card and are aged 15 or older. Howev-
er, many cash transfers are conditional, with criterias being unclear. Suspicions of political bias in access to
21
benefits distributed through the card –but not in access to the card itself– are frequent.
Alongside the Fatherland Card, the Maduro administration increasingly relied on direct distribution of
food packages by local committees to participant families under the CLAP program. These committees are
meant to come from and represent local communities and work alongside the food ministry to distribute the
packages sold at subsidized prices to program participants. However, in practice, their membership is primar-
ily designated to overrepresent pro-government political organizations.
According to government spokespersons, the CLAP food boxes currently reach some 7 million families or
more than 75% of Venezuela’s population. Data from private surveys and a national survey of living condi-
tions developed by a consortium of national universities and NGOs, ENCOVI, indicates that the share of the
population that had access to subsidized food through government programs from 2014 to 2021 was broadly
in line with government estimates.
Available data indicates that government supporters are more likely to receive CLAP packages, a cash
transfer through the Card of the Fatherland system and access to COVID vaccination. Yet the data also shows
that there is nothing even remotely resembling total exclusion of opposition supporters from the programs.
More than two-thirds of opposition supporters receive CLAP packages and around half receive Fatherland
Card transfers. While the pattern suggests that there may be some political bias in the allocation of benefits,
it also shows that any biases are clearly not strong enough so as to severely restrict opponents from accessing
the benefits. These differences could also be explained, in part, by differences in the socioeconomic character-
istics of government supporters compared to opposition supporters, or a problem of political self-selection.
While the CLAP system has been playing a useful role in alleviating poverty in the country, a number of
changes to its design would be desirable in order to eliminate or mitigate their use as vehicles for clientelism.
Among the key problematic elements in the CLAP design, we note its strong pro-government branding and
distribution through politicized committees that overrepresent pro-government social organizations. We
also believe that increased national ownership of the program as a state policy, instead of as the initiative of
a single political party, can prove beneficial, especially if combined with an information campaign to dispel
some myths surrounding its conditioning on government support.
One way to create incentives for the Maduro administration to accept these changes to the program design
would be to offer financing for the programs through one of the several funding sources proposed in this
report. For instance, the CLAP program could be funded through an oil-for-essentials program, external
resources from existing liquid deposits or multilateral financing or even through aid donations. A cooperative
design can also benefit the program by incorporating multilateral oversight in procurement and distribution
to avoid slippage to corruption.
22
Chapter 1
The Humanitarian Crisis in Context
Between 2012 and 2020, Venezuela’s real per cap- The proximate driver of Venezuela’s GDP
ita GDP contracted an astonishing 72%,1 mark- decline is the collapse of its oil sector. Between
ing one of the largest economic catastrophes in 2012 and 2020, the volume of oil production
modern history. While the worst of the crisis and oil exports fell respectively by 79% and 76%,
appears to be over — analyst estimates indicate with oil export revenue falling by an even larg-
that per capita economic activity rebounded an er 93% due to the additional effect of declining
accumulated 14% between 2021 and 2022, cut- oil prices. In contrast to comparatively more di-
ting the aggregate decline for the whole decade versified economies, Venezuela’s near-complete
to 68% — there are significant reasons to believe specialization in hydrocarbons made its econ-
that a full, sustainable recovery of living stan- omy highly sensitive to reductions in export
dards will not be possible unless it is accompa- revenue.3 Oil accounted for 96% of Venezuela’s
nied by a radical change in Venezuela’s internal export revenues at the start of the crisis in 2012.
and external conditions. Data compiled by pri- The ensuing collapse of the oil industry thus led
vate universities, international agencies and hu- to a large reduction in the country’s capacity to
manitarian NGOs suggests that the population import capital and intermediate goods, with the
remains in a profoundly vulnerable position and associated negative effects on production.
inequality has continued to worsen despite the The effects of the collapse of the oil industry
recent economic rebound.2 on the country’s general macroeconomic condi-
THE HUMANITARIAN CRISIS IN CONTEXT 23

Figure 1: Venezuela’s real per capita GDP and real per capita oil exports, 2003-2022
Source. Own elaboration based on BCV.
tions have only been exacerbated by its lack of ac- itarian outcomes.
cess to multilateral financing, international aid, The United Nation’s (UN) Food and Agri-
and external assets. Venezuelans today consume culture Organization (FAO) estimates that the
significantly fewer calories than one decade ago undernourishment rate – the percentage of the
and are more likely to become ill and die as a re- population whose habitual food consumption is
sult. Venezuelan mothers are more likely to de- insufficient to provide the dietary energy levels
velop anemia and Venezuelan newborns are less required to maintain a normal, active, and healthy
likely to survive.4 The overwhelming majority of life – rose from 3% of the population in 2012 to
Venezuelans face severe uncertainty as to how 27% in 2019.5 The timing of this staggering in-
they will feed themselves on a day-to-day basis crease coincides with that of the start of the de-
and have significantly altered their lifestyles to cline in per capita income and the evolution of the
cope with the severe scarcity of affordable food. series as a whole also tracks that of the GDP data,
While Venezuela’s economic crisis is due to mul- with undernourishment declining strongly in pe-
tiple factors, including poor economic manage- riods of high economic growth (2004-2012) and
ment and misguided policies, economic sanc- increasing strongly in periods of contraction.
tions and international isolation have decisively Underlying the undernourishment data is a
contributed to worsening economic and human- notable decrease in the availability of food avail-
24 COOPERATIVE RESPONSES TO VENEZUELA’S CRISIS

Figure 2 Prevalence of undernourishment, 2000-2020 (% of population)
Note: Series represents a three-year moving average. The yellow lines correspond to the periods for which
FAO reports the series as being less than or equal to 2.5%. FAO does not report point estimates lower than
2.5% but instead indicates only the fact that the estimate falls below such a threshold.
Sources. Adapted from Rodríguez (2023c).
able for consumption. The FAO’s food supply tural vulnerability that arises from decades of
balance statistics for Venezuela – extracted from oil dependence. It is well-known that countries
the organization’s Food Balance Sheets (FBS) with a high endowment of extractible natural
dataset – show a 27% decline in the volume of resources will tend to become uncompetitive
food available for consumption between 2015 in the production of other tradable goods in-
and 2019.6 Both declining domestic production cluding agriculture, a phenomenon typically
– which fell by 25% – and net imports of food – characterized as the “Dutch Disease.” 8 The de-
which fell by 35% – contributed to the decline pendence was exacerbated during the past two
in availability for consumption. 7 decades by policies that promoted an overval-
The 36% decline in food imports in the ued official exchange rate as well as expropria-
2015-19 period played an important role in the tions of large landholdings and agro-industrial
decline in food availability. Lower imports di- plants carried out without a meaningful land
rectly contributed to the lower food supply for reform process.
consumption, as well as to the low availability Despite the lack of official data on numerous in-
of intermediate inputs and capital goods for the dicators, some alternative data sources paint a com-
food-producing industry. Venezuela’s depen- pelling picture. In particular, ENCOVI – a national
dence on food imports is an important struc- survey of living conditions developed by a consortium

Table 2. FAO Food Balance Sheets (in metric tons), 2010 – 2019
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2015-19
(a) Production 24,566 24,752 23,764 23,927 23,874 22,028 18,098 17,896 18,579 16,431 -5,597
(b) Net Imports 7,905 7,448 8,832 9,188 9,397 7,656 4,997 5,884 4,723 5,014 -2,642
(c) Intermediate
7,425 7,158 7,095 8,090 8,472 9,159 6,586 6,734 7,187 5,832 -3,327
Inputs
(d) Other 1,496 1,270 1,764 2,077 1,913 1,521 -36 1,187 1,063 1,399 -122
(e) Residuals 3,310 3,077 3,966 3,296 2,167 -452 206 247 306 -69 383
(f) Food Available
for Consumption 20,240 20,696 19,771 19,651 20,719 19,456 16,339 15,612 14,746 14,283 -5,173
(a + b - c - d - e)
(g) Net Production
17,141 17,595 16,669 15,837 15,402 12,869 11,512 11,162 11,392 10,599 -2,270
(a - c)
(h) Productivity
3.3 3.5 3.3 3.0 2.8 2.4 2.7 2.7 2.6 2.8 0.4
(a/c)
Sources. Adapted from Rodríguez (2023c).
of national universities and NGOs – offers a wide ar- tions seen in the year. However, this reduction in the
ray of indicators on education, health, nutrition and poverty rate has not been accompanied by an improve-
food access, poverty, unemployment, and migration, ment in inequality, as the Gini Coefficient continued
and has become the most cited source for social data to deteriorate in 2022. ENCOVI estimated the Gini
on Venezuela. While we caution about the interpreta- Coefficient for Venezuela at 0.603, up from 0.407 in
tion of the data and particularly its consistency across 2014, placing the country as the most unequal in the
editions,9 the survey does consistently show a general continent and one of the most unequal in the world.11
deterioration across indicators when compared to its ENCOVI data also shows that educational enroll-
earliest available publication, which is for 2014.10 ment between the ages of 3-24 fell from 73% in 2014
The ENCOVI data shows that multidimensional to 63% in 2022. However, most of the deterioration in
poverty – a measure of poverty that accounts for in- the indicator appears to be more a consequence of the
come, education, housing, and employment – rose COVID-19 pandemic than of the economic crisis, as
from 39% in 2014 to 51% in 2022. Poverty by income enrollment remained relatively stable until 2019-20,12
similarly rose from 48% in 2014 to 82% in 2022, while oscillating between 76% and 69%, but fell sharply to
extreme poverty went from 24% to 53% in the same 65% in 2021 and 63% in 2022.
period. More than 7 million Venezuelans are estimat-
An interesting point is that both multidimension- ed to have left the country since 2015,13 which is
al and income poverty show an improvement in 2022 equivalent to a loss of almost a fourth of the coun-
(almost 15 p.p. in multidimensional poverty and close try’s initial population. There are few if any prec-
to 10 p.p. in poverty by income). This is not unexpect- edents for such a large-scale movement of people,
ed given the improvement in macroeconomic condi- particularly given that the exodus is not the prod-

uct of an armed conflict but rather the conse- ed to a rise in international oil prices and a rebound
quence of an economic catastrophe. in Venezuela’s oil production from the minimums
Is the end of the crisis near? A double-digit cumu- reached in 2020. However, in the second half of
lative growth performance in a two-year period – like 2022, both international oil prices and Venezuela’s
that registered by Venezuela in 2021 and 2022, 14% oil production began showing signs of stagnation.
– would generally be regarded as very impressive if The continuity of Venezuela’s growth in the next
achieved by a country in regular circumstances. How- few years will crucially depend on the recovery of
ever, in the context of an accumulated 72% decline in the oil industry, which makes understanding the
the 8 years preceding it, this growth has been able to deeper causes of the crisis and its potential solu-
reverse the deterioration in the country’s living con- tions – both structural and palliative – critical for
ditions only minimally. policymakers and stakeholders interested and in-
Most of the 2021-2022 rebound can be attribut- volved in Venezuela’s hopes for recovery.
The Worst Economic Disaster in Peacetime
Venezuela’s economic contraction in the last de- definition, we find that the 2012-2020 collapse of
cade is one of the worst growth catastrophes in 71.5% is part of a lengthier steeper collapse start-
world history and the worst in a country not un- ing in 1977, amounting to 73.0%. Table 3 ranks
dergoing an armed conflict. While different studies growth collapses in recorded history. Interestingly,
sizing the collapse employ different criteria for the Venezuela stands out as the fifth worst collapse in
definition of GDP (absolute or per capita, in real recorded history, with the 2012-2020 part of the
or purchasing power parity adjusted terms) and collapse being enough to earn it the spot in the
the exact dating of the episode, most agree that the ranking. Furthermore, if we consider only peace-
brunt of the decline came between the collapse of time collapses, we find that Venezuela experienced
international oil prices in 2014 and the trough set the worst growth collapse in recorded history in
by the COVID-19 pandemic in 2020. Rodríguez the absence of war.14
and Imam (2022) and Rodríguez (2023a) define Social and humanitarian indicators portray
a growth collapse as the largest drop in per capita a similarly bleak picture. According to FAO
income to occur after a given record (a record is data, the country has the highest level of un-
the highest level of per capita income attained up dernourishment in the region (27%), far ex-
until a given moment by the country) and before ceeding the second highest (Bolivia, at 13%);
any subsequent record which occurs during a peri- it is also the 15th highest level of undernour-
od in which total income also declines. Under this ishment globally. The increase in undernour-

Table 3. Largest per capita GDP collapses, constant-price GDP
Trough-to- Cumulative
Average
Rank peak ratio loss (% of
Rank Country Period Years percentage Armed Conflict
(Peacetime) (percentage initial GDP
decline
decline) per capita)
1 Liberia -89% 1974 - 1995 21 -9% -734% Intrastate conflict
2 Kuwait -87% 1970 - 1991 21 -8% -1134% Interstate conflict
Intra and interstate
3 Iraq -77% 1979 - 1991 12 -8% -366%
conflict
D.R. of the Intra and interstate
4 -76% 1974 - 2002 28 -5% -1191%
Congo conflict
5 1 Venezuela -73% 1977 - 2020 43 -3% -874% Peacetime
Venezuela -71% 2012-2020 8 -14% -256% Peacetime
6 Tajikistan -71% 1990 - 1996 6 -19% -290% Intrastate conflict
7 2 Lebanon -71% 1974 - 1976 2 -44% -102% Peacetime
8 Georgia -71% 1990 - 1994 4 -25% -215% Intrastate conflict
9 Iran -67% 1969 - 1988 19 -4% -793%
conflict
10 Yemen -66% 2010 - 2019 9 -11% -386% Intrastate conflict
11 Moldova -65% 1990 - 1999 9 -10% -474% Intrastate conflict
12 Azerbaijan -61% 1990 - 1995 5 -17% -188%
conflict
13 3 Djibouti -61% 1976 - 1991 15 -6% -668% Peacetime
14 4 Saudi Arabia -60% 1974 - 1987 13 -6% -359% Peacetime
15 Angola -59% 1973 - 1994 21 -4% -678%
conflict
16 Nicaragua -58% 1977 - 1993 16 -5% -684% Intrastate conflict
17 5 Gabon -58% 1976 - 2009 33 -2% -1451% Peacetime
18 6 Ukraine -58% 1990 - 1998 8 -10% -324% Peacetime
19 Sierra Leone -58% 1990 - 1999 9 -9% -284% Intrastate conflict
20 Serbia -57% 1990 - 1993 3 -24% -107%
conflict
Sources. Own calculations, Penn World Table, Focus Economics, adapted from Rodríguez and Imam (2022)
ishment is staggering , seeing that Venezuela – and 3rd highest in Latin America and the
went from having a developed country level of Caribbean. It is comparable to those of some
undernourishment of less than 3% of the pop- poor Latin American nations such as Bolivia
ulation to have the highest level in the region (21) and Guatemala (21) yet well below that
in just over a decade. of Haiti (47) or Dominican Republic (28).
Per the United Nations Inter-Agency Group Against a global background, the figures look
for Child Mortality Estimation (UN IGME) somehow less negative; Venezuela ranks as the
data, Venezuela’s 2021 infant mortality rate 75th highest out of 195 countries estimated
of 21 deaths per 1000 live births is the 2nd by the UN IGME.
highest out of 12 countries in South America

The Economic Roots of the Humanitarian Crisis
The proximate cause of the country’s eco- outs for humanitarian activities. The problem
nomic contraction is the decline in its ca- with this reasoning is that it ignores that the
pacity to import caused by plummeting oil reason why Venezuela has faced its humanitari-
revenues. Venezuela’s crude oil production an emergency is precisely because of its inabili-
fell by 79% between 2012 and 2020, strong- ty to sustain adequate import levels for essential
ly impacted by the loss of offshore assets and goods. The fact that the contraction of imports
markets that resulted from U.S. sanctions as has caused the deterioration of socio-economic
well as by investment cutbacks that occurred indicators also suggests that as the country sees
after the 2014-16 collapse in oil prices.15 imports recover, it is also likely to experience an
Plummeting production resulted in plummet- improvement in its living standards, including its
ing oil exports and, consequently, a plummeting health and nutrition indicators.
capacity to import goods and services. The economy’s total imports of goods de-
Rodríguez and Guerrero (2020) argue that clined by 91% during the 2012-20 period, fall-
oil activity affects the Venezuelan economy ing from USD 66 bn to USD 6 bn. In the same
through its direct effect on oil GDP but also period, food imports declined by 78%. Notably,
through its indirect effect on non-oil GDP. there has been a significant increase in the share
While oil accounted for only 12% of Venezue- of food in total imports – from 12% in 2012 to
la’s GDP in the four quarters ending in March 36% in 2020. In other words, as import capac-
2019 (the latest available data point), the pro- ity declined, the country assigned greater pri-
duction of non-tradable and import-competing ority to imports of essentials like food. Yet it is
goods that makes up the rest of the country’s also the case that the decline in the economy’s
output is only made possible through the im- capacity to import made it impossible to main-
ports that are paid for with the country’s oil ex- tain past levels of imports of essential goods.
port revenues. Even if the economy were currently purchasing
What is less well understood is that this re- only food from the rest of the world (i.e., if it
duced capacity for imports has also been at the had decided to reduce to zero all other imports
root of Venezuela’s humanitarian catastrophe. It including other essentials such as medicines as
is common to hear the argument that US sanc- well as capital and intermediate goods for its oil
tions have no adverse humanitarian consequenc- industry) it would still be able to pay for only
es because they include comprehensive carve- 82% of the food it imported in 2012.

Figure 3. Food imports, 2012-2020
Sources. Comtrade, adapted from Rodríguez (2023c)
Interestingly, the data show a stabilization in food be able to address its hunger crisis without reinserting
imports in the 2017-2020 period, despite a continued itself into the global economy, which would require at
decline in total imports and general economic activity. the very least a significant easing of current economic
Food imports in 2020 show similar absolute levels as sanctions.
in 2017 (USD 2.0 bn in 2017, USD 1.8 bn in 2020) To summarize, we argue that the root of Venezu-
despite total imports falling by 49% and GDP by 51% ela’s humanitarian crisis is the collapse of its external
during that period. In other words, the decline in im- revenues, which is at least partially a consequence of
port capacity that occurred after 2016 did not lead to the severing of its trade and financial links to the glob-
lower food import levels because the economy found al economy. Addressing the crisis requires recovering
a way to prioritize food imports. the economy’s capacity to generate resources to feed
Venezuela’s sensitivity to changes in import capac- its people. This will not occur without a significant
ity is also a reflection of the economy’s exacerbated easing of trade and financial sanctions on the econo-
import dependence, in itself a consequence of a re- my, particularly, on the oil sector, which has been the
source-based development model reinforced by the country’s primary engine of growth for the past cen-
policies of the last two decades that stifled private tury.
sector growth in other tradable industries. Absent a
deep structural transformation – which could, realis-
tically, only materialize gradually – Venezuela will not

The Economic Effects of the Recognition Crisis
As we explained in previous sections, Venezuela’s eco- ers through several additional rulings taken in 2016
nomic contraction that began in 2013 intensified with and 2017 for as long as the Legislature remained in
the terms-of-trade shock produced by the collapse of contempt.
oil prices from 2014 on. This collapse clearly preceded In May 2017, President Maduro announced
the intensification of its political crisis. The country elections to convene a Constitutional Convention.
entered a recession in the first quarter of that year and Opposition leaders unanimously condemned the
dipped into double-digit rates of contraction in the announcement, charging that it was nothing more
fourth quarter of 2015, ahead of the opposition’s vi- than an attempt to create an all-powerful body to nul-
ctory in the December 2015 parliamentary elections. lify the 2015AN. Elections were held 3 months later
In December 2015, the opposition coalition won a re- under a boycott of all opposition parties, leading the
sounding victory in parliamentary elections, defeating body to be fully integrated by Maduro loyalists. In Au-
pro-government forces by a 56% to 41% margin. This gust 2017, the Trump administration issued the first
resulted in a 112-55 supermajority in the National As- of several executive orders blocking financial and com-
sembly, which then became the only branch of power mercial transactions with Venezuela’s government.16
not under the direct control of Maduro loyalists. In May 2018, Nicolás Maduro ran for reelection
In the immediate aftermath of the opposition’s in presidential elections. However, the validity of the
electoral victory, the outgoing legislature appointed event was contested by the opposition-controlled
13 justices to the supreme court under conditions that 2015AN and key international stakeholders, includ-
were deemed illegitimate by the opposition and some ing the U.S. government. These actors regarded con-
civil society observers. This court, in turn, moved to ditions for the 2018 elections as neither free nor fair,
suspend the election of 4 representatives elected for the leading to a boycott that allowed Maduro to win with
incoming legislature on charges of vote-buying, effec- the support of 68% of the votes. Turnout in the elec-
tively rendering the opposition’s victory partly ineffec- tions, of 46%, was the lowest ever registered in a Ven-
tual by driving it below a two-thirds threshold which ezuelan presidential election (turnout had averaged
constitutionally would give the opposition-controlled 78% in the previous three presidential races).
National Assembly wide-ranging powers. The opposi- The opposition-controlled 2015AN argued that,
tion initially refused to withdraw the suspended rep- given the invalidity of the elections, the position of
resentatives, resulting in the supreme court declaring president for the 2019-2025 term would be left va-
the National Assembly elected in 2015 (2015AN) in cant.17 Despite this, Maduro was sworn in for a sec-
contempt of its decisions. This developed further into ond term that was to start on January 10, 2019. After
a conflict between the judicial and legislative branch- an intense internal debate among opposition forces,
es, as the Court progressively assumed legislative pow- 2015AN President Juan Guaidó publicly claimed

THE ECONOMIC EFFECTS OF THE RECOGNITION CRISIS
that he would assume the competencies of the exec- National Assembly),21 a large number of EU member
utive branch as interim president of Venezuela. The states had.22
U.S. government recognized this claim on January 23, Political changes in South America and elsewhere
and 57 other countries, including key members of the also resulted in changes in the recognition of com-
European Union and neighboring South American peting claims. For instance, Colombia shifted from
countries, followed. However, the claim was far from recognizing Guaidó during Iván Duque’s presidency
uncontested, as some key commercial partners for to recognizing Maduro under Gustavo Petro after the
Venezuela, including China, Russia, and Iran, chose latter assumed the presidency (August 2022), leading
to recognize Maduro as president instead. to a regularization of diplomatic relationships and,
The issue of recognition became even more convo- crucially, the transfer of control of Monómeros (a Co-
luted in the following years, as the constitutional man- lombia-based subsidiary of Pequiven, a state-owned
date of the 2015AN ended on January 5, 2021. On De- enterprise) from Guaidó appointed authorities to Mad-
cember 6, 2020, the Maduro-aligned electoral authority uro appointed ones.23 A similar change resulted from
held legislative elections to renew the parliament, but Pedro Castillo’s swearing-in as president of Perú (in July
opposition parties regarded the event as illegitimate.18 2021),24 Alberto Fernández in Argentina (December
A new National Assembly in which pro-government 2019),25 Luis Arce in Bolivia (November 2020),26 and
parties had an overwhelming majority (henceforth, the Xiomara Castro in Honduras (January 2022),27 among
2020AN) was elected in a process boycotted by main- others.
stream opposition parties.19 In response, the 2015AN As we explain in further detail throughout this
extended its own mandate on similar arguments to book, the recognition of Juan Guaidó as president
those used to designate Guaidó as interim president. of Venezuela, and the resulting de-recognition of
This effectively added another layer of uncertainty over the Maduro administration, resulted in a situation in
the legal representation of Venezuelan institutions, as which the entity legally empowered to represent the
Guaidó’s mandate as interim president was directly de- country in key jurisdictions lacked effective control
rived from his position as president of the 2015AN. of the territory it claimed to represent. This discrep-
In January 2021, the High Commissioner of the ancy between legal status and economic reality – in
European Union issued a statement expressing regret combination with U.S. sanctions – contributed to
at the election of the 2020AN under a process that worsening the crisis by increasing the country’s inter-
lacked democratic guarantees, yet also referred to the national isolation. Venezuela lost access to the U.S.
2015AN as the “outgoing National Assembly elected market for its oil, lost its capacity to deploy existing
in 2015.” On January 25th, the EU’s Council of State external assets for the benefit of the population, and
issued a statement in which it said that it would recog- was barred from attempting to restructure its debt or
nize Guaidó as a “privileged interlocutor.”20 While the seeking multilateral financing.
EU had never actually referred to Guaidó as interim
president (but it had referred to him as president of the

The End of the Interim Government
and its Implications for our Proposals
Frictions within the political coalition backing In 2021, PJ’s proposal passed a first discussion in
Guaidó became clear in late 2021, as a dispute the 2015AN’s plenary but was then heavily modified
over the role of the interim government and the as part of a political bargain that allowed the interim
extent of future legislative oversight and control president to retain most of his competencies. As part
over it emerged between Justice First (Primero of the negotiation, Guaidó agreed to disband several
Justicia, PJ) one of the four largest parties in the presidential commissions and to downsize the interim
coalition, and Popular will (Voluntad Popular, government’s diplomatic representation abroad.
VP), Guaidó’s own party. Opponents of the proposal argued that it violated the
At the time, the 2015AN was debating the principle of separation of powers enshrined in the con-
extension of its own legislative period and the stitution by transferring functions from the executive to
interim government’s operations for an addition- the legislative branch, leaving the former as a mere legal
al year. PJ was pushing to reform the transition figurehead and placing it under the latter.32 Several legal
statute28 that governed the interim government scholars associated with the Guaidó administration33
and the National Assembly’s operations, so as to argued that the interim government did not require re-
transfer most of the interim president’s compe- newal by the National Assembly and would legally re-
tencies to a 2015AN’s Delegate Commission, in main in place until the institutional void created by the
a modality described by legal scholars associated invalid 2018 elections was resolved through free and fair
with the interim presidency as an “unconstitu- presidential elections. Despite these legal arguments,
tional parliamentary government.”29 parties in the opposition coalition insisted on the need
Among other changes, the reform assigned the to renew the periods of the 2015AN and the interim
National Assembly’s Delegated Commission30 government. Such renewal was occurred twice through
the capacity to designate administrative boards two time-bound renewals of the transition statute; first
for state-owned enterprises and other govern- in December 202034 and then in January 2022.35
ment agencies, the management of diplomatic In December 2022, the 2015AN approved its third
relations, and the designation of diplomatic per- reform of the transition statute, extending the Nation-
sonnel.31 The reform would have eliminated the al Assembly’s period for another year but dissolving the
figure of the “Special Attorney General,” which interim government and appointing a commission to
served in the Guaidó administration as the pri- protect and manage the country’s external assets. The
mary legal advisor and representative of the in- reform was supported by three of the four main par-
terim government, as well as a number of other ties in the coalition – PJ, Democratic Action (Acción
special commissions. Democrática, AD) and A New Time (Un Nuevo Ti-

empo, UNT) – but was vehemently opposed by VP that they were not consulted on its planning and, in
(Guaidó’s former party),36 and was approved with 72 some instances, that they were altogether excluded
votes in favor, 29 against, and 8 abstentions.37 The co- from participating.43 For instance, leaders of the Vene-
ordinator of VP, Leopoldo López, responded to these zuela First (Primero Venezuela, PV) party claimed that
frictions by accusing members of the opposition del- they had approached and held meetings with the com-
egation of colluding with the Maduro government.38 mission organizing the primaries, but the party had
The decision to dissolve the interim government been excluded from participation in the event.44 In pri-
appeared to signal a change in the opposition’s strat- or statements, opposition leaders had warned against
egy, as the mainstream opposition coalition prepared allowing the group to participate in the primaries45 on
to participate in the upcoming 2024 presidential elec- account of the participation of some of its leaders in a
tions. Since March 2022, the mainstream opposition June 2020 takeover of opposition party PJ.46
coalition has been openly debating the possibility of For years, analysis of Venezuelan politics has
holding primary elections to select a single candidate been premised on the idea that the country is split
to face Maduro. In October 2022, the coalition des- into two political blocs: the followers of Hugo
ignated a 10-member commission to organize the Chávez and his successor, Nicolás Maduro, on the
event,39 and in February 2023 announced that the one hand, and the country’s opposition on the oth-
process would be held in October of that year.40 er. That assumption was consistent with almost all
The primary process is, in principle, open to the existing data, including electoral returns, opinion
participation of all sectors that define themselves as polls, and casual observation. Candidates represent-
non-government, but some sectors are critical of the ing government and opposition coalitions captured
organizers and have either been excluded or self-ex- an average 92% of the vote in the 14 nationwide
cluded from participating. Some politicians outside of elections held since 2000 (excluding those that the
mainstream groups – such as Antonio Ecarri and Ben- opposition chose to boycott), while 70% of survey
jamin Rausseo – have discarded participation,41 while respondents labeled themselves either pro-opposi-
others – such as María Corina Machado of Come tion or pro-government between 2013 and 2017.47
Venezuela (Vente Venezuela, VV) – initially set condi- However, the results from the November 2021 elec-
tions for their participation, including that the poll be tion point to a major shift, as candidates from the
open to Venezuelans abroad and not organized by the mainstream opposition and government coalitions
Venezuelan electoral authority – the National Elector- took only a combined 68% of the vote, while inde-
al Council (Consejo Nacional Electoral, CNE).42 Of pendent parties unaligned with either block took the
these, María Corina Machado eventually agreed to remaining 32%. These results are mirrored in the evo-
participate in the process fully. lution of the polling data: according to data from the
Leaders from some independent parties have stat- local polling company Datanálisis, the share of voters
ed that they won’t participate in the primaries, arguing who self-identified with either the government or the
that the process is not sufficiently inclusive and open, opposition in 2021 was only 39%, significantly lower

THE END OF THE INTERIM GOVERNMENT AND ITS IMPLICATIONS FOR OUR PROPOSALS
than the 60% who claim to be aligned with neither He notes that courts rejected the Maduro adminis-
sector. In contrast, back in 2015, 65% claimed to be tration’s claim to the representation of the Venezuelan
aligned with the government or opposition while state as a de facto government due to the existence of
31% saw themselves as non-aligned.48 a de jure interim government and characterizes the de
The lack of identification with either of the jure recognition of the interim government as a “first
traditionally dominant political blocks by a large barrier” against the international recognition of the
segment of the population constitutes a chal- Maduro administration.
lenge for Venezuelan political forces and for the So far, this has not been the case, at least in relation
negotiation of a broad political agreements. to the U.S., which continues to refuse recognition to
The reform of the transition statute also estab- the Maduro government. There is at least one recent
lished a Board of Administration and Protection experience in which the U.S. and other key western
of Assets and granted the 2015AN the power to governments have refused to recognize any govern-
appoint new ad hoc boards to manage Venezuelan ment and blocked the de facto government from ac-
entities that control assets abroad, such as the Cen- cess to funds – that is the case of the Taliban in Af-
tral Bank of Venezuela (Banco Central de Venezu- ghanistan. However, the dissolution may still create
ela, BCV) and PDVSA. The reform contemplates complications even if the relevant governments do
appointing a new PDVSA board while it ratifies not recognize Maduro, as we discuss in Chapter 5.
the current members of the ad hoc Board of the The long-term effects of the decision to dis-
BCV. Three weeks later, the 2015AN designated solve the interim government are still unclear. In
the five members of the board; Gustavo Marcano this work, we presume no change to the current
(coordinator), Carlos Millán, René Uzcátegui, Yon state of affairs in regard to the control of exter-
Goicoechea, and Fernando Blasi.49 As we detail in nal assets and overall international recognition.
Chapter 5, the board is unlikely to achieve the de- That is, we assume that under the current status
sired depoliticization of the management of Vene- quo, the 2015AN through its appointees will
zuela’s external assets as it fails to address the most maintain the capacity to manage Venezuela’s as-
important institutional problems in the process to sets in the U.S. and UK. Previously released pro-
designate its members. posals for cooperative approaches that involved
Some commentators posited that the dissolution negotiations between the Guaidó and Maduro
of the interim government would lead directly to the administrations – such as the 2019 Humanitar-
international recognition of the Maduro government ian Oil Agreement proposal released by the Oil
and his taking over the control of existing foreign as- for Venezuela foundation – must therefore be
sets.50 In this line of thinking, Hernández (2022a) reframed as a negotiation between the Maduro
argues that the non-recognition of the Maduro gov- government and the 2015AN or whatever body
ernment in U.S. and UK courts is a consequence of is recognized as exercising the control of Venezu-
the recognition of the Guaidó interim government. ela’s assets by key foreign governments.

The Role of Sanctions in the Economic Crisis
Although the collapse of the oil sector was driven ficking and terrorism in Venezuela. While the pe-
by multiple factors,51 there is overwhelming riod coincided with a souring of U.S.-Venezuela
evidence that U.S. economic sanctions played a relations, the main source of explicit concern was
key role in it. It is thus hard to visualize a solution the alleged links between Venezuelan authorities
– or even effective palliative measures – to the and a number of international criminal organi-
country’s humanitarian crisis that does not zations rather than the Venezuelan government’s
involve a significant easing of these restrictions on internal policy actions.
Venezuela’s engagement with the foreign world. Personal sanctions are usually implemented
In this section, we first outline the elements of through the inclusion of persons or firms in the
the sanction regime and briefly comment on their list of Specially Designated Nationals (SDNs)
most relevant impacts. Chapter 2 discusses at maintained by the Office of Foreign Assets Con-
further length the literature on the effectiveness of trol (OFAC). The inclusion implies a prohibition
sanctions and their unintended collateral effects, on U.S. persons (firms or individuals) doing busi-
while Chapter 3 provides a more thorough survey ness with the SDN, which results in the blocking
of the literature attempting to quantify their effect of bank accounts and assets held by the sanctioned
on oil production in the Venezuelan case. person within the U.S., as well as other diverse
The Venezuelan sanctions regime is an interre- consequences.
lated set of laws that restricts the interactions that The early focus on terrorism and drug-traffick-
U.S.-based individuals and firms can have with the ing activities began shifting when the U.S. Con-
Venezuelan state as well as individuals linked to gress passed the “Venezuela Defense of Human
the government of Nicolás Maduro.52 It is crucial Rights and Civil Society Act of 2014” which al-
to differentiate economic – including trade and fi- lowed the president to impose individual sanc-
nancial varieties – from personal sanctions. Only tions on present or former officials determined
the U.S. government has imposed economic and to have violated human rights as part of the Ven-
financial sanctions on Venezuela, while personal ezuelan government.53 Building upon this law, the
sanctions have been deployed by several U.S. al- Barack Obama administration issued Executive
lies, including countries in the European Union Order 12751 in March 2015. The order declared
and Canada. a national security emergency in relation to Ven-
In the first phase of the confrontation, going ezuela and sanctioned seven Venezuelan officials
from 2006 to 2017, the US government mostly from law enforcement and judicial backgrounds
resorted to personal sanctions as a policy tool that for human rights violations during the 2014 pro-
aimed to counter the proliferation of drug-traf- tests.

THE ROLE OF SANCTIONS IN THE ECONOMIC CRISIS
The declaration of a national emergency is a The order explicitly restricted financial transac-
necessary requisite for the executive branch to tions involving:
appeal to the powers granted in the Emergency
Economic Powers Act of 1977 to restrict trade •New debt with a maturity greater than
with entities that represent a threat to U.S. na- 90 days with PDVSA,
tional security. However, it wasn’t until 2017 •New debt with a maturity greater than
that the U.S. government moved to impose eco- 30 days, or new equity, of the government
nomic – as opposed to only individual – sanc- of Venezuela,
tions. This occurred in response to the Maduro •Bonds issued by the government of
administration’s alleged escalation of political Venezuela before the date of the order,
repression in the aftermath of the opposition’s except those listed in an annex (in
resounding victory in the December 2015 par- practice, only VENZ 2036, which was
liamentary elections and the emergence of a fully held by Venezuelan government
conflict between the judiciary and legislative institutions, was barred from trading),
branches of government. •Dividend payments or other
On February 2017, OFAC added Venezue- distributions of profits from Venezuela-
lan Vice President Tareck El Aissami and a close controlled entities (including U.S.-based
associate of his, Samark López, to the SDN list. PDVSA branch CITGO),
In May, it also added Supreme Court President •The purchase of new securities from the
Maikel Moreno and all seven justices of the government of Venezuela.
Court’s Constitutional Chamber. In contrast to
prior designations, these targeted very high-rank- The August 2017 sanctions represented a de-
ing figures in the Maduro administration. parture from earlier efforts in that they implied a
On August 24, 2017, the Trump administra- widening of the target of the sanctions; whereas
tion issued Executive Order 13808 imposing previous measures had targeted individuals, Ex-
financial sanctions on the Venezuelan govern- ecutive Order 13808 targeted the Venezuelan
ment, marking a new phase of U.S. foreign poli- government, and its subdivisions, in general.
cy towards the country. The order forbade U.S. Financial sanctions do not exist in a vacu-
persons from participating in any transactions um. They should be seen rather as a stage in the
that provided funds for the government of Ven- evolution of the “financial toxification” process
ezuela or PDVSA. It thus impeded a potential which resulted in the raising of the legal and rep-
restructuring process, the refinancing of certain utational costs of doing business with the Ven-
types of PDVSA commercial debt, and the le- ezuelan government. At the start of 2017, the
veraging of assets held abroad, among a host of National Assembly and opposition politicians
other operations. developed a strategy to actively try to block the

Venezuelan government’s access to funds.54 As immediate effect – as it only conceded to Trea-
we have noted, Venezuela’s exclusion from key sury the ability to issue these designations – but
financial and trade markets is the result of sev- opened the door for the U.S. government to tar-
eral factors, including the financial toxification get broad types of economic activities.
campaign by the 2015AN, the competing claim It wasn’t until January 2019, in the immediate
to the presidency by Juan Guaidó in 2019, and aftermath of Juan Guaidó’s swearing-in as inter-
U.S. economic sanctions.55 im president, that the U.S. government began im-
Exclusion from financial markets can be exposing oil trade sanctions on the country. Imme-
pected to affect the operational capacity of state- diately after Guaidó’s swearing-in, 24 countries
owned enterprises. Lack of access to external including the U.S. and 11 members of the Lima
finance can lead a firm that has no access to alter- Group (a coalition of Latin American countries
native sources of funding to cut back on operating with predominantly center-right governments
expenses, with immediate effects on production. aligned with the opposition) announced that
There is also a myriad of ways in which sanctions they would recognize Guaidó as the legitimate
barring lending can curtail a firm’s ability to car- president. That number would grow to a maxi-
ry out its day-to-day activities, as modern finance mum of 57 and would then decline progressively
is commingled with a set of other activities that to just 12 at the time of the dissolution of the
are essential to the productive process.56 interim government. The Trump administration
During 2018, the Trump administration con- also included PDVSA in its SDN list under the
tinued extending economic sanctions. In March, authority granted in Executive Order 13850, ef-
it issued Executive Order 13827, banning trans- fectively barring any US nationals from doing
actions related to the Venezuelan government’s business with the company or its affiliates. Since
cryptocurrency, the Petro, and, in May, Execu- PDVSA is the majority stakeholder in oil joint
tive Order 13835, which prohibited transactions ventures in Venezuela’s oil sector, the decision
related to the purchase of Venezuelan debt, in- effectively constituted a prohibition on U.S. pur-
cluding accounts receivable, and the purchase of chases of Venezuelan oil, as well as of exports of
any equity stake in any entity in which the gov- oil products to Venezuela. The decision is thus
ernment had a 50 percent or greater interest. It most adequately characterized as an oil embargo.
also issued Executive Order 13850 of November The designation was accompanied by the is-
2018, which gave the U.S. Treasury Department suance of seven general licenses containing ex-
the authority to designate as an SDN any per- ceptions, most of them time-bound, primarily
son (individual or firm) operating in the gold intended to allow for the winding down of com-
sector of the economy “or in any other sector of mercial transactions between U.S. entities and
the Venezuelan economy” as determined by the PDVSA. Among these, the most important was
Treasury Department. By itself, the order had no General license 8, which allowed five U.S.-based

THE ROLE OF SANCTIONS IN THE ECONOMIC CRISIS
oil companies (Chevron Corporation and four Venezuelan government; while the authority to
oil service providers) to continue operating in impose secondary sanctions in this order was
Venezuelan territory. arguably redundant with that granted by the No-
This round of sanctions affected Venezuela vember 2018 order, it still served as an indirect
in two ways: it prohibited U.S. persons from ex- way to pressure Chinese and Russian oil compa-
porting diluents to Venezuela (these are funda- nies to cut ties with PDVSA.
mental to processing Venezuela’s heavy oil into The swearing-in of Joe Biden in January 2021
useable grades) and barred access to what was led to no major immediate changes in Venezuela
at the time its largest single export market. At a policy. The much-awaited change in sanctions
bare minimum, this means that PDVSA would policy only came about in November 2022. Late
have been forced to sell its oil to less profitable into the month, the government and opposition
destinations and/or for discounts. We examine announced that they would resume political ne-
this issue further in Chapter 3. gotiations.58 Days later, the sides met in Mexico
The Treasury Department also sanctioned City and announced that they had agreed on
state-owned gold mining company Minerven on terms for the creation of a humanitarian fund
March 19, 2019, and several state-owned banks to be fed with more than USD 3 bn in existing
including the National Development Bank frozen funds that would be managed by the UN
BANDES and the Banco de Venezuela, the larg- for the benefit of the Venezuelan population.59
est bank in the country, on March 22, 2019. A Hours later, OFAC published an updated ver-
humanitarian exception did accompany this de- sion of General License 41 that allowed oil ma-
cision, allowing transactions related to human- jor Chevron to engage in transactions related to
itarian assistance. However, while this made it the production, lifting, and sale of Venezuelan
possible for Venezuelan entities to transfer funds oil into the United States, as well as the purchase
related to humanitarian purchases, this is a dis- and importation into Venezuela of the interme-
tinct issue from that of selling oil to obtain reve- diate inputs needed to carry out these activities.60
nue to pay for these imports. The Mexico dialogue stagnated as Maduro
In August 2019, the Trump administration refused to resume talks before the unfreezing of
issued Executive Order 38843, which blocked the agreed-upon USD 3 bn of the humanitari-
access by the Venezuelan government to its U.S. an fund.61 The government of Gustavo Petro in
The decision was interpreted by the Guaidó ad- Colombia then began involving itself as a me-
ministration as blocking potential external asset diator in an attempt to help resume the Mexico
seizures by creditors, though most analysts and process. In late April, his government hosted
legal experts disagree.57 Another provision al- the International Conference on the Political
lowed the adoption of secondary sanctions on Process in Venezuela in the city of Bogotá with
non-U.S. actors for business dealings with the the participation of 19 delegations, including

the U.S., Germany, Canada, France, Norway, try to attend the conference, but his participa-
Mexico, United Kingdom, South Africa, Bra- tion was blocked by the Colombian government
zil, Chile and a representative of the European – which had not invited the Maduro govern-
Union. Juan Guaidó travelled to Colombia to ment to the conference either.62
Cooperative Agreements for Venezuela

As we have argued in the preceding pages, the Venezuela humanitarian crisis is a direct consequence
of its economic crisis, which is itself the result of institutional arrangements that create perverse incen-
tives for destructive confrontation in the context of a zero-sum distribution of economic gains. In this
work, we discuss existing proposals for cooperative solutions to Venezuelan economic problems that
aim both to address the immediate effects of the humanitarian crisis and to foster the development of
institutions that allow the parties in the conflict to resolve their disputes in a more productive manner.
Where we stand today
The resumption of political negotiations between the ceptions where some agreements were reached – such
Maduro government and the opposition in late 2022 as the December 2016 Vatican-mediated talks or the
offers the country a chance to turn a new page in its June 2020 COVID agreement – the parts failed to
two-decade conflict. The political agreement for the follow through after intense back-and-forth recrim-
creation of the humanitarian fund is a first step in the inations.
right direction, as it puts the general welfare of the Upon relaxing the restrictions on Chevron’s activ-
population at the forefront and sets a template for ities in Venezuela, the Biden administration quickly
further cooperative solutions to attend the crisis. Sim- clarified that it viewed the decision as an incentive for
ilarly, expanded participation of foreign companies in the Maduro government to continue engaging the
the Venezuelan oil sector is a necessity if the aim is to opposition in productive negotiations while denying
meaningfully alleviate the humanitarian crisis. that the move would result in increased cash flows
However, negotiations are not guaranteed to for his government.63 This has led analysts to specu-
be successful. Venezuela has an extensive history of late that restrictions could be snapped back quickly
failed negotiations going back to 2002. In the few ex- if Maduro failed to follow through.64 On the other

hand, the humanitarian fund was only agreed upon country’s electricity infrastructure68 – collapsed as
in principle and the actual implementation details the sides pondered the benefits of the agreement
were left open for further negotiation,65 leading to to their bid for power in the context of a zero-
significant delays in the implementation and imply- sum game. In essence, if mobilizing resources that
ing that differences could still emerge and lead to a help address the humanitarian emergency leads to
complete suspension of the initiative. increases in Maduro’s popularity, allowing him to
Previous cooperative agreements – like a 2021 win a future election, or simply reducing the chances
agreement to buy 340 thousand antigen tests as that a popular or military rebellion will oust him, the
well as a deal to use offshore funds controlled by the opposition may conclude that entering into the deal
Guaidó administration to fund the payment of vac- is a poor choice.
cines through the World Bank’s COVAX system66 – The current process risks failing in a similar fash-
broke down on implementation. In the first of these, ion. Months after the first political agreement for the
the opposition accused the government of not ad- creation of the humanitarian fund, there is no pub-
ministering the antigen tests effectively, while in the licly visible progress on its implementation. Maduro
second the government insisted on making the CO- administration representatives have asserted an un-
VAX payments on its own and refused to authorize willingness to resume further talks until the humani-
the Astra-Zeneca vaccine.67 tarian fund is fully implemented, mentioning that the
Other initiatives – like the December 2019 lack of follow-through with this agreement lowers the
proposal for the United Nations (UN) and regional credibility of opposition and U.S. commitments.69
multilateral bank CAF to work on repairing the
Negotiated Agreements Against the Backdrop of Political Conflict
The most crucial feature of Venezuela’s political eco- find these out, the party that lost out on a deal will ra-
nomy is its winner-takes-all zero-sum structure. Eco- pidly try to go back to the status quo by reneging on
nomic theory has stern predictions for the outcome whatever deal it agreed to.
of negotiations under these circumstances, as oppo- Political negotiations can only yield stable changes
sing sides in such a conflict will often insist on a ne- from initial conditions if bargaining takes place over a
gotiated solution in which they are at least as well off positive-sum structure of payoffs and the agreements
as in the status quo but, by the very definition of a are enforceable or the actors have strong incentives to
zero-sum game, the only such solution is the status comply with them. Thus, the crucial challenge is de-
quo itself. In the rare instances where parties come to signing humanitarian programs that transform the
an agreement, it may be because they have imperfect zero-sum game into a positive-sum one and generate
information about the actual outcomes; once they incentives for the sides to comply with them.

NEGOTIATED AGREEMENTS AGAINST THE BACKDROP OF POLITICAL CONFLICT
One way to tackle this challenge is by focusing on with the Maduro administration may be easier
the negotiation of progressively incremental sectori- to “sell” to the opposition’s political constituen-
al agreements that create direct value for Venezue- cies than in previous years. Large sectors in the
lans over and above their instrumental use for solving mainstream opposition appear to have decided
other problems. We distinguish sectoral agreements to abandon their previous strategy of attempting
from partial agreements, which are those in which to force the ouster of Maduro by non-electoral
the sphere of negotiation only has instrumental val- means and committed to contesting the presi-
ue in addressing a more complex problem. dency in elections. In the lead-up to the event, it
Actors can build up credibility through repeated is possible that they will also recognize that de-
interactions that make it rational for their counter- creasing the stakes of power would be crucial for
parts to believe in their promises of compliance and holding on in office in the aftermath of a hypo-
the negotiation framework can build the incentives thetical victory. Maduro, on the other hand, still
for that by planning a sequence of deals such that com- needs to solve concrete economic and human-
pliance over time is rewarded with progressively more itarian problems, some of which he cannot ad-
attractive payouts in additional partial negotiations. dress without cooperation with the opposition.
For the sides to find that it makes sense to en- Another important reason why humanitarian
ter into these sectoral agreements, they must be sectoral agreements may be more feasible now
convinced that they would be unable to address than in the past is that they may be able to count
the specific problems that the agreements intend on the support of key international actors who
to tackle on their own. In other words, there must could converge under a multilateral approach to
be genuine gains from cooperation. As an example, convince both parties to go along with the solu-
Maduro had no reason to seek the opposition’s help tion. It is unlikely that the opposition, which de-
to vaccinate the country if his government could do pends for its bargaining power on international
so on its own and claim all the political benefits de- recognition and sanctions, would refuse to go
rived from doing so. along with an initiative strongly supported by
Importantly, because of the current structure of the U.S. and Europe. For roughly the same rea-
constraints over control of assets and legal repre- sons, it is also unlikely that Maduro would refuse
sentation created by sanctions and the de-recog- to go along with an initiative that China and
nition of the Maduro government, there are many Russia strongly support. While it may not be fea-
problems that the government and opposition can sible to reach an agreement between the U.S., the
only solve cooperatively. Those that require the EU, China, and Russia on the design of a grand
mobilization of resources – for example, by access- political transition of power in Venezuela, it may
ing blocked funds or oil markets – are completely be much more feasible for such an agreement to
intractable in the absence of cooperation. emerge around an initiative to address the coun-
Sectoral agreements involving cooperation try’s economic and humanitarian crisis.

Recommendations
The first consideration in designing cooperative by both sides from the onset can serve to reduce the
agreements for Venezuela is to acknowledge the risk of the program being captured by either side.
zero-sum game embedded in the country's political In this regard, it is critical for the parties to clear-
economy. The challenge in this regard is to design ly communicate to the public the motivation and
agreements that transform or recast this zero-sum benefits of any humanitarian agreement they agree
game into a positive-sum one. One possible way to on.
do this is by expanding the scope of the negotiation A second crucial consideration is to account for
to go beyond the purely political and to directly ad- the lack of trust between the parties, which derailed
dress the parties’ shared interest in improving the previous negotiation attempts. If properly designed,
general welfare of the population as well as by ex- humanitarian initiatives with progressively incre-
panding the participation in negotiations to other mental payoffs can also help build up credibility
parties and non-political actors. between the parties through repeated interactions
To some degree, the latest round of negotiations that reward compliance over time.
appears to acknowledge the need to address Vene- A third concern is for the implementation to ac-
zuela’s humanitarian and economic crisis; however, count for the low institutional quality environment
these partial agreements remain subject to progress in Venezuela. Preventing slippage of humanitarian
on the broader political agenda and are thus sus- resources to corruption and political assignment
ceptible to backtracking or cancelation at any given of the benefits is key to the political sustainabili-
point. ty of the effort. Minimizing this slippage requires
A related concern is in structuring humanitarian the implementation of clear monitoring and au-
programs in a way that prevents either party from dit mechanisms. Transparency in implementation
capturing the full merit of its implementation. As is also crucial to enhance public accountability, as
we have noted, previous humanitarian agreements well as to enhance the parties’ responsibility to the
collapsed during the implementation phase due to public for delays in implementation and reduce the
disputes between the parties over the attribution scope for them to blame each other for derailments.
of the merit of the welfare gains generated by the Efficiency in the use of public funds requires in-
program. To some degree, this is an unavoidable ternational standards in procurement, execution,
problem in designing cooperative agreements, and other aspects of the implementation process.
since welfare gains will tend to favor the incum- In this regard, multilateral agencies can provide
bent; however, strongly communicated ownership invaluable expertise by requiring compliance with

international best-practices standards as a pre-
requisite for involvement in any given initiative.
Multilateral agencies can also support humanitar-
ian programs by directly participating in the audit
processes or directing their implementation.
Humanitarian initiatives can also strongly ben-
efit from direct involvement and buy-in from local
NGOs and community representatives, which can
help ensure that the program is designed to meet
the needs of the people on the ground and build
up support for the program by expanding its stake-
holder base. More broadly, finding a lasting solu-
tion to the country’s governance crisis requires that
the parts of its political conflict find a way to coex-
ist, and this requires them to learn to cooperate in
finding concrete solutions to the country’s prob-
lems. As Acemoglu and Robinson (2019) argue,
historical experience strongly shows that when ex-
ternal actors try to build state institutions from the
top down without the participation of local actors,
key stakeholders in society will either withdraw or
rebel and these arrangements will prove ultimately
fragile and vulnerable.
Finally, we note that no cooperative agreement,
ambitious as it may be, can fully address the Ven-
ezuelan humanitarian crisis if does not ease the
external constraints on the country’s economy.
Improving the general welfare of the population
requires recovering, at least partially, the country’s
economy.

Endnotes
1
We estimate that real GDP contracted 74% during the period, but the population also contracted by 9%.
These estimates are based on official data as far as it is available (2019), updated with consensus forecasts from
FocusEconomics (2023) and statistical inference.
2
ENCOVI (2022), Caritas (2021), OCHA (2022), FAO (2023), Raffali and Villalobos (2021).
3
For theoretical approaches to understanding the vulnerability of Venezuela’s non-oil growth to oil revenues, see
Rodríguez and Sachs (1999), Hausmann and Rigobón (2003), and Hausmann and Rodríguez (2012).
4
See Rodríguez (2023c) for a more extensive discussion of Venezuela’s hunger crisis and its determinants.
5
FAO reports only three-year moving averages and does not publish the yearly data. For ease of exposition, we will refer
to the middle-year of the moving average when referring to the time of a specific observation, e.g.: 2012 corresponds to
the 2011-13 period. See FAO (2022a) for a full definition of the variable.
6
In principle, FBS statistics are based on official agricultural surveys, although in Venezuela’s case, most observations in
the data are imputed. FAO does not make clear the extent or the methodology for imputation, so the numbers must be
interpreted with caution.
7
The amount of food available for consumption equals the sum of the country’s domestic production and its net
imports, minus intermediate inputs (used for domestic production), other uses (losses, non-food uses and stock
variations) and residuals. Net production equals gross production minus intermediate inputs. Productivity is the ratio of
food production to intermediate inputs. In the 2015-19 period the absolute decline in food available for consumption
was smaller than the decline in domestic production because of a recovery in productivity; the country imported less
food inputs but produced proportionally more food with them.
8
See Gelb (1988), Auty (2001), Humphreys et al. (2007), Smith and Waldner (2021), The Economist (1977).
9
The main problem is that the organizers do not publish an integrated suite of adequately revised time series or the
underlying microdata, and changes in sampling techniques make earlier releases non-comparable with the latest
iterations. Furthermore, its organizers had a funding shortfall for the 2022 edition, which forced them to limit sampling
and indicator coverage.
10
ENCOVI (2022).
11
UCABve (2022).
12
ENCOVI lacks separated datapoints for 2019 and 2020, as the 2019-2020 edition of the survey is based on data
compiled between November 2019 and March 2020.
13
Arena et al. (2022).
14
We control for intra state and inter state wars as recorded by Correlates of War (n.d).
15
See Rodríguez (2023, chapter 2) and Monaldi et al. (2021). Most indicators of investment show increasing or flat
trends until 2016. Some features of the property rights regime certainly impacted on Venezuela’s capacity to attract
foreign investment, suggesting that the country could have seen higher levels of production growth during the boom
years.
16
Across this work we refer to the “Government of Venezuela” as that led by Nicolás Maduro. This is reflective of a
recognition of his administration’s factual control over the territory but is not an endorsement of the legitimacy of his
claim over the presidency. We similarly refer to the “Guaidó administration” without any endorsement of Juan Guaidó’s
legal claim to the presidency between 2019 and 2022.
17
Hernández (2022a).

18
Miranda (2021).
19
Throughout this work, we use the term “mainstream opposition coalition” to identify the largest opposition coalition
as measured by share of votes obtained by the coalition or its member parties in the most recent prior non-boycotted
election. This includes the Democratic Coordinator between 2002 and 2004, the from 2008 to 2018, the Frente
Amplio Venezuela Libre in 2018, the parties backing the interim government of Juan Guaidó from 2019 to 2020, and
the Unitary Platform (Plataforma Unitaria, PU)/Democratic Unity Roundtable (Mesa de la Unidad Democrática,
2023) from 2021 on.
20
Council of the European Union (2021).
21
European Council of the European Union (2019).
22
Government of UK (2019).
23
Redacción BBC Mundo (2022).
24
Lozano (2021a).
25
González (2020).
26
La Nación (2020).
27
France 24 (2022).
28
Officially titled “Estatuto que rige la transición a la democracia para restablecer la vigencia de la Constitución de la
República Bolivariana de Venezuela” (Statute Governing the Transition to Democracy to Reestablish the Constitution
of the Bolivarian Republic of Venezuela).
29
Hernández (2022b).
30
The National Assembly’s Delegated Commission is a subgroup of the legislature integrated by the assembly’s
president, the assembly’s vice presidents and the presidents of each permanent commission. Traditionally, the Delegated
Commission was tasked with performing key legislative functions in representation of the plenary while the latter was
in a legislative holiday. See Constitución de la República Bolivariana de Venezuela. art 196 and Constitución de la
República Bolivariana de Venezuela. art 197. However, starting in 2021, the Delegated Commission was tasked with
representing the legislature outside of legislative holidays due to the 2015AN plenary’s inability to convene normally.
31
Brewer-Carias (2022).
32
Hernández (2022b).
33
Hernández (2022b); Sequera (2021).
34
Ley del Estatuto que rige la Transición a la Democracia (2020)
35
Discusión Proyecto Reforma Estatuto para La transición (2022).
36
Juan Guaidó formally withdrew his membership in the party in January 2020, arguing for the need to focus on his role
as head of the interim government. See Infobae (2020).
37
Armas (2022).
38
Primeraedicioncol (2023).
39
Martínez (2022b).
40
Moleiro (2023).
41
Piña (2022).
42
TalCual (2022).
43
Antolínez (2023), Acción Democrática (2022), Siverio (2023), Maduradas (2023).
44
Radio Fe y Alegría (2023).

45
Hernández (2023).
46
In June 2020, the Venezuelan supreme court suspended the existing leadership of Primero Justicia and designated an
alternative one. The decision was regarded as arbitrary by the mainstream opposition and political leaders who accepted
these positions were deemed as being false members of the opposition. See Morales (2022).
47
Rodríguez (2022c).
48
Rodríguez (2022c).
49
Nederr (2023a).
50
Lugo (2022).
51
See Hernández and Monaldi (2016), and Monaldi (2021) for a review of some of the most commonly cited factors in
the collapse of Venezuela’s oil industry.
52
See Oil for Venezuela (2019) for a more extensive discussion of the history of the sanctions regime.
53
Venezuela Defense of Human Rights and Civil Society Act of 2014 (2014).
54
Rodríguez (2018).
55
See Oil for Venezuela (2019).
56
One of the most important examples of the ways in which financial sanctions affected the oil industry is that they
prevented PDVSA from developing further financing agreements with its foreign joint venture minority partners,
which had become an important source of funding for investment in the domestic oil industry. Financial sanctions also
prevented PDVSA from continuing to refinance arrears to providers by securitizing loans through the issuance of NY-
law promissory notes. Finally, while financial sanctions carved out exceptions for trade-credit of under less than 90 days,
there is substantial evidence that these exceptions were far from sufficient to protect all trade-related loans. Even Citgo,
the PDVSA-owned U.S. refining arm, began having trouble obtaining routine trade credit after sanctions were imposed.
For a more thorough discussion of these channels see Rodríguez (2019).
57
Cohen and Stempel (2019).
58
Quesada (2022)
59
Banca y Negocios (2022b)
60
Gilroy, Test and Tovar (2022).
61
Quesada (2023)
62
La Nación (2023).
63
U. S. Department of the Treasury (2022b).
64
Atlantic Council Experts (2022b).
65
Atlantic Council Experts (2022b).
66
Vasquez (2021).
67
Yapur (2021).
68
Sequera and Ellsworth (2020).
69
Infobae (2023a).

Chapter 2
International Policy and the
Venezuelan Crisis
The unprecedented economic and humanitar- Foreign policy and the actions of domestic
ian crisis in Venezuelan has lasted more than a actors are strongly interrelated. The parties
decade, exposing millions to poverty, food in- to the Venezuelan political conflict can play a
security, and lack of access to adequate health- key positive role in helping shape international
care and precipitating one of the worst refu- policy towards the country; however, doing so
gee crises in modern history. In this chapter, requires them to put aside some of their differ-
we review key aspects of international policy ences and find ways to cooperate to improve
towards Venezuela that have impacted on this the welfare of Venezuelans.
crisis and propose ways in which the interna- While the country’s economic collapse was
tional community can improve its approach. initially triggered by the fall in oil prices in
We focus on three key aspects of international the second half of 2014, the loss of access to
policy: the sanctions regime, the policy sur- key commercial and financial markets, result-
rounding Venezuelan migrants and refugees, ing from the legitimacy crisis and econom-
and humanitarian aid. ic sanctions, has prevented the recovery and
INTERNATIONAL POLICY AND THE VENEZUELAN CRISIS 49

INTERNATIONAL POLICY AND THE VENEZUELAN CRISIS
even worsened the crisis. As we discussed in more, it appears evident that the inducement of
the previous chapter, the process of international prospective sanctions lifting has yet to yield sig-
isolation was the direct result of increasing polit- nificant tangible concessions from the Maduro
ical tensions in the country. In the wake of the government.
opposition’s victory in the 2015 National Assem- International isolation and the intensification
bly elections, the Maduro government increas- of the political conflict can also complicate the
ingly employed its control of the judicial branch effective distribution of humanitarian aid, par-
to nullify the new opposition-aligned legislature. ticularly if aid itself becomes a politically sensi-
The following years were marked by a strong dete- tive subject, as has been the case in Venezuela.
rioration of democratic institutions in the coun- As we elaborate in the next few pages, the Mad-
try. U.S. President Donald Trump first imposed uro administration refused to allow internation-
economic sanctions as a policy tool to aid in gen- al aid into the country for many years, viewing
erating a regime change in the short-term and fa- its acceptance as a show of weakness. While this
cilitate a democratization process.70 stance was relaxed to some degree beginning in
Academic and practical experience with sanc- 2019, international commitments to aid Vene-
tions indicates that they are ineffective in pro- zuela are too small to satisfactorily address the
voking the kind of regime change targeted for crisis. We believe that political agreements can
Venezuela. Yet while the Trump administration’s serve both to depoliticize aid and to attract high-
“maximum pressure” strategy was shortly prov- er levels of funding for humanitarian initiatives
en unsuccessful in achieving its stated aims, the in the country.
U.S. government’s approach to sanctions has only We also discuss the Venezuelan refugee crisis
been marginally revised over the years. and changes in international policy towards it.
Supporters of sanctions as a policy tool con- Venezuelan migration has been a heated political
tend that they have value as they provide a use- subject across Latin America in the past years and
ful deterrent against further institutional deteri- has increasingly also become a topic in U.S. polit-
oration and their lifting can serve as a powerful ical debate. As a consequence of the high volume
incentive for the Maduro government to engage of migrants and refugees, many countries across
in negotiations with the opposition. Sanctions the continent have toughened their migration
are kept in place under the justification that they requirements for Venezuelans. We argue that in-
are the Venezuelan opposition’s only leverage in creased restrictions run contrary to international
negotiations. However, whatever usefulness sanc- commitments to the protection of refugees. Nev-
tions have as a policy tool, they must be weighed ertheless, we stress that a satisfactory resolution
against the economic harm to the general popu- to the refugee crisis requires a significant im-
lation of the targeted country and the potential provement in the country’s economic conditions.
strengthening of the targeted regime. Further-

The Refugee Crisis
Venezuela’s economic catastrophe has led to a sons, who are defined as persons who flee their
massive population exodus, with migrants tur- place of residence without leaving their country.
ning to neighboring and distant countries se- Venezuela does not conform to either of these
eking refuge. At least 6.4 million Venezuelans cases. The country is not undergoing an armed
have fled the country since 2017; when com- conflict and, while the government has been ac-
bined with previous migrants, the total num- cused of engaging in serious human rights viola-
ber of Venezuelans abroad reached 7.2 million tions, there is no evidence of the types of large-
persons by the end of 2022, a whopping 23% scale systematic abuses that typically lead to
of the country’s population in 2015, when the mass displacements. Instead, migrant flows are
crisis started. primarily motivated by economic reasons. Sim-
There are few precedents for such a large- ilarly, while the amount of internally displaced
scale movement of people. The closest compari- persons is unknown due to the near-total lack
sons are the Syrian exodus – the largest contem- of recent demographic data, anecdotal evidence
porary refugee crisis, with 7.2 million refugees suggests that internal population movements
amounting to 32% of its pre-crisis population – have been large but also that the key driver is
and Colombia – where 7.7 million, or 16% of its related to economic opportunities and the poor
current population, are estimated to have been state of public services rather than threats of po-
internally displaced. litical persecution or armed conflict.71
Neither comparison is completely accurate The flow of Venezuelan refugees has heavi-
from a methodological standpoint. Syria’s fig- ly concentrated in South American countries.
ure represents actual refugees, defined as people Colombia is by far the largest recipient of Ven-
who escape their country while fleeing conflict ezuelan immigration, having received 35% of
or persecution. By contrast, only 211 thousand Venezuelan emigrants up to 2022. Peru is a
Venezuelans have officially been granted refugee distant second at 21%. The two countries thus
status, albeit another 1.03 thousand are request- account for more than half of Venezuelan im-
ing such status. Syria has another 6.8 million migration. Venezuelan refugees began turning
internally displaced persons, taking the “total towards the U.S. in the aftermath of the pan-
population of concern” according to the United demic, 72 partly as a consequence of poor eco-
Nations’ Refugee Agency to 15.3 million per- nomic conditions in South America and also
sons. In the case of Colombia, the number cor- due to increased migratory requirements from
responds exclusively to internally displaced per- neighboring countries.

Table 4: Stock of Venezuelan immigrants per country, 2015-2022
Country 2015 2017 2018 2019 2020 2021 2022

Colombia 162,397 544,065 1,237,030 1,630,903 1,771,501 1,742,927 2,477,588
Peru 2,351 26,239 768,148 863,613 1,043,460 1,049,970 1,506,368
Ecuador 8,901 39,519 263,000 385,042 431,230 432,866 502,214
Chile 8,001 119,051 288,233 371,163 457,324 457,324 444,423
Brazil 3,425 35,000 96,000 224,102 262,475 261,441 414,502
Argentina 12,856 57,127 130,000 145,000 179,203 174,333 171,050
Panama 9,883 36,365 94,400 94,596 121,198 121,598 147,627
USA 255,520 290,224 351,144 351,144 505,647 545,234
Spain 165,895 165,895 323,575 137,776 189,110 199,078 438,380
Others 180,005 273,022 357,151 719,640 943,912 1,427,376 1,075,733
Total 809,234 1,586,507 3,908,681 4,922,979 5,905,060 6,412,147 7,177,885
Sources. R4V, INE Spain, US Census Bureau.
The potential effects are quantitatively si- with emigrant populations, working-age mi-
gnificant. The inflows represent 5% of Co- grants are overrepresented in the group of
lombia’s population, 4% of that of Peru, and emigrants, making the potential labor market
3% of that of Ecuador. As is typically the case impacts larger.
The Policy Response
While many recipient countries were initially quirements applied to Venezuelans by 11 coun-
receptive to Venezuelan migrants, as the num- tries in Latin America and the Caribbean, finding
ber of people arriving grew relative to the native a significant increase in requirements over time.
population, many countries have experienced The study evaluates three aspects; i) whether the
an upsurge in anti-immigration sentiment.73 As country requires a Visa for entry into its territo-
a response, governments across Latin America ry, ii) whether it requires the person to hold a
increasingly attempted to curb migration by passport, and iii) whether it accepts expired pass-
imposing increasingly stringent migration reports.74 In 2015, only one of the eleven countries
quirements. in the study required Visas from Venezuelans
In a recent work, the Center for Disaster and six required that the person held a passport.
Philanthropy (2022) examined immigration re- By 2019, four had imposed Visa requirements

Table 5: Entry requirements for Venezuelans in selected host countries, 2015 vs 2022
Visa Required in Passport Required

Advance for Entry? for Entry? Accepts Expired Passports from
Country Venezuelans for Entry? (Decem-
End of Decem- End of Decem- ber 2022)
2015 ber 2022 2015 ber 2022
Argentina No No No No No
Aruba No Yes Yes Yes No
Bolivia No No No No No
Yes, it accepts passports expired for
Brazil No No No No
up to 5 years.

Canada Yes Yes Yes Yes
up to 5 years.
Chile No Yes Yes Yes Yes
Colombia No No Yes Yes
up to 5 years.
Curazao Yes Yes Yes Yes No
Costa Rica No Yes Yes Yes No
Ecuador No Yes No Yes No
El Salvador Yes Yes Yes Yes No
Dominican Republic No Yes Yes Yes No
Yes with an extension certificate
Guatemala No Yes Yes Yes issued by the Venezuelan embassy
in Guatemala.
Guyana Yes Yes Yes Yes No
Honduras No Yes No Yes
up to 5 years.
Mexico No Yes Yes Yes No
Nicaragua No Yes Yes Yes No
Panama No Yes No Yes No.
Paraguay No No No No Yes
Peru No Yes No Yes Yes
Trinidad and Tobago No Yes No Yes No
United States Yes Yes Yes Yes
up to 5 years.
Uruguay No No No No No
Source. Own elaboration based on Alvarez et al. (2022).

POLICY RESPONSE
and two had started requiring passports, while Besides entry requirements, the regulariza-
five accepted expired documents for entry. By tion of migrants is also key. The Center for
2022, four more countries had imposed Visa re- Disaster Philanthropy (2022) notes that coun-
quirements. Since May 2023, Suriname entered tries such as Perú and Colombia have instituted
the list of countries that have imposed a visa re- special regularization pathways, allowing them
quirement on Venezuelans. to regularize over 2.7 million people, while
Panama was the first country in the study to Brazil has granted regular status to almost all
impose Visa requirements in 2017; Chile fol- migrants. Starting in 2017, Colombia began
lowed the next year, eliminating a process that providing special work and residency permits
allowed tourist Visas to be converted to work for Venezuelans – the “Permiso Especial de Per-
Visas, and also requiring Venezuelans to apply manencia” (Special Permanence Permit) – to
for migration permits within Venezuela. In facilitate their integration into the host econ-
2019, Peru, Trinidad and Tobago, Chile, and omy. 77 Initially, the permit covered regular mi-
Ecuador imposed Visa requirements for Vene- grants only, but the scope was later expanded to
zuelan tourists. Starting in 2022, Mexico also irregular migrants as well. Argentina and Uru-
imposed the requirement.75 guay provide favorable conditions for legal resi-
These increasingly stringent requirements dency under the terms negotiated as part of the
came despite political declarations of support Southern Common Market (MERCOSUR)
for Venezuelan migrants at the regional level. In agreement. Other countries have introduced
September 2018, 11 countries in Latin Ameri- smaller-scale programs.
ca and the Caribbean –including some of the In 2022, migration flows toward the U.S.
main destinations of Venezuelan immigration– began rising, 78 turning the Venezuelan refugee
signed a declaration under the “Quito Process,” crisis into a political issue that has been exploit-
a collaborative effort to deal with the influx of ed for political gain by politicians supporting
migrants from Venezuela to the rest of the re- anti-immigration platforms. As an example,
gion. 76 The signatory countries committed to Florida Governor Ron DeSantis shipped two
cooperating to ensure the protection and pro- planes of undocumented migrants who sought
motion of migrant rights, including their access asylum in Florida –including at least 50 Vene-
to basic services, procedures to determine refu- zuelans– to Martha’s Vineyard –a popular sum-
gee status, and other processes for the regular- mer destination for wealthy Americans in Mas-
ization of immigrant status. Importantly, the sachusetts– as a political move to raise support
countries committed to accepting expired iden- for his anti-immigrant policies. 79
tity documents, while also urging the Venezue- The shift to the north has also resulted in
lan government to provide valid documentation migrants turning to increasingly difficult and
to its citizens. dangerous routes. Organizations such as the

UN Refugee Agency (UNHCR) have warned nouncement that Venezuelans caught passing
of a significant increase in the number of Ven- illegally through the border would be deport-
ezuelans crossing the dangerous Darien Gap, a ed back to Mexico, which is being carried out
remote and lawless jungle region on the border based on a Trump-era decision based on Title
between Colombia and Panama that is consid- 42 of the U.S. Code – a provision that allows
ered one of the most dangerous migrant routes for turning back asylum-seekers at the border
in the world and where refugees are exposed to if they risk spreading a communicable disease.
extortion, robbery, and violence at the hands of This systematic rejection of illegal migrants is
criminal gangs, in addition to natural hazards.80 being carried out despite White House admis-
HRW has pointed out that stricter Visa re- sions that there is no public health justification
quirements in North and Central America have for the measure. 83 While Title 42 expired on
played a key role in this shift.81 May 2023, it was replaced by legislation giving
In October 2022, the Biden administration the executive the authority to expel migrants
announced a new process to grant legal entry crossing the border illegally.84
and temporary residency to 24,000 Venezuelans
in the U.S. on humanitarian grounds.82 To be el-
igible, Venezuelans must find a sponsor with the
economic means to sustain them, as well as pass
safety vetting and public health requirements.
However, the measure came alongside the an-
Recommendations
Economic research on immigration, in gener- as humanitarian aid, health care, and education,
al, and the Venezuelan case, in particular, has but also contributed to higher levels of growth
shown significant medium-term benefits that and total factor productivity. Similarly, Alvarez
can outweigh the short-term costs associated et al. (2022) found 0.1-0.5% of GDP increases
with increased inflows. on fiscal expenditures, 0.1%-0.3% higher aver-
Using Colombian data, Rodríguez (2021a) age annual GDP growth rates, and no evidence
found that Venezuelan migration added 0.34% of displacement of locals in labor markets.
of GDP in net fiscal expenditures on items such This is not to discount that there are nega-

tive impacts on wage earnings of local workers, found that this held true for violent crimes in
particularly in the short-term. These effects ap- Colombia but found more ambiguous data for
pear to be focused on low-skilled workers and other crimes.
are of small-to-moderate magnitude. Peñalo- Doocy et al. (2019) and Gómez (2018)
za-Pacheco (2021) associated a 1 percentage looked in the health impacts of Venezuelan
point increase in the Venezuelan labor force in migration to Colombia, finding increases in
Colombia with a 0.5 percentage points decrease infectious diseases and stress on public health
in wages and a 0.1 percentage points increase services.
in unemployment. Lebow (2022) and Caruso The literature suggests that formalizing un-
(2019) present similar findings, suggesting that documented immigrants could have positive ef-
Venezuelan immigration may be contributing fects on the Colombian economy. Both Pulido
to wage depression in the Colombian labor and Varón (2020) and the International Mone-
market. tary Fund (2020) provided optimistic estimates
However, there is also substantial evidence for increased productivity and GDP growth re-
of positive productivity effects resulting from sulting from Venezuelan migration and integra-
Venezuelan immigration. Mutis et al. (2021) tion into the formal economy. These findings
found that Venezuelan migration positively are congruent with international research on
affected Colombian labor productivity in the the economic impacts of immigration, which
short term. Ramirez (2021) also found pos- often finds positive effects on productivity
itive effects on production but noticed a wid- (Peri and Sparber, 2009; Bahar and Rapoport,
ening gap in wages and consumption between 2018; Yi-Chang, 2020). A broad range of stud-
skilled and unskilled workers. This aligns with ies, such as those by Peri (2012), Kangasniemi
Martínez’s (2004) argument for the positive im- et al. (2012), Rolfe et al. (2013), Campo et
pact of highly skilled immigrants on the oil inal. (2018), Delgado (2020), Hierländer et al.
dustry, and the fiscal impact reported by Melo (2010), Marois et al. (2020), and Terziev and
et al. (2020). Can (2018) demonstrate a similar pattern.
On the issue of crime, research by Bahar, The literature acknowledges potential fiscal
Dooley, and Selee (2020) disputes public per- pressures associated with immigration. Howev-
ceptions that Venezuelan immigrants contrib- er, studies like Kancs and Lecca (2019) argue
ute significantly to crime. The authors found that despite initial costs, the long-term ben-
that the percent of crimes committed by Vene- efits of immigrant integration can outweigh
zuelans in Chile and Perú was lower than their these, and migrant contributions can increase
representation in the population. They also over time with better labor market integration

(Docquier et al., 2014). Queaq (2019) suggests ties to the Venezuelan political conflict to lever-
that adopting integration policies for refugees age existing assets and multilateral lending to
can yield positive economic outcomes across a attend to some of the country’s main economic
range of indicators. problems. The Maduro administration could
To maximize the benefits of immigration, also be invited to cooperate with regulariza-
countries should seek to integrate Venezuelans tion efforts by facilitating identification efforts.
into formal labor markets. Achieving this re- However, ultimately, the scale of the Venezuelan
quires a broad range of policy changes, going migration crisis is too large to attend to without
from reworking regularization frameworks to addressing its root causes in the economic crisis
expediting the issuance of work permits, re-eval- the country has been undergoing since 2014.
uating legal restrictions on the participation of
foreigners in the labor market, and facilitating
the accreditation of professional skills and the
attainment of professional licenses.85
The U.S. must also redesign its migration
strategy by respecting the right to seek asylum
by all those who are fleeing political persecu-
tion and human rights violations. The Biden
administration’s policy for sponsor-based tem-
poral residency permits is explicitly designed to
exclude those who need it the most while priv-
ileging those who already have the means and
resources to migrate to the U.S. Given current
labor market shortages, the U.S. economy could
benefit from higher levels of immigration by
Venezuelans, who have significantly contribut-
ed to boosting productivity in many other host
countries. Any program to expand legal path-
ways should not unfairly penalize disadvan-
taged and vulnerable groups.
Funding is also key, as we will show in the
next section. Chapter 4 provides proposals for
cooperative solutions that would allow the par-

Humanitarian Aid
In this section, we review the international commu- in the context of successive Humanitarian Response
nity’s response in the form of foreign aid –grants Plans (HRPs) since 2019, targeting projects in
and donations to alleviate the humanitarian crisis– health, nutrition, sanitation, and migrant protection
particularly in terms of its magnitude and the chal- and benefiting between 4-5 million people per year.86
lenges that international organizations have faced in OCHA’s HRP has been chronically underfunded.
attending Venezuela. If we only consider humanitarian funding earmarked
The United Nations Office for the Coordination for the plan, we find that donations only covered
of Humanitarian Affairs (UN OCHA) coordi- 31% of HRP funding requirements in 2019, 25% in
nates the international community’s humanitarian 2020, 37% in 2021, and 34% in 2022. Even adding
response to the Venezuelan crisis by matching do- other humanitarian funding would only raise these
nations with projects by UN agencies and local or ratios to 78% in 2019, 36% in 2020, 50% in 2021,
international NGOs to assist inside the country. Its and 38% in 2022.87
latest report, released on August 2022, notes that Over the years, the U.S. government and the
OCHA had mobilized “more than” USD 800 mn European Commission have been providing most
Figure 4: Ratio of total funding to HRP funding requirements, Venezuela
Sources. OCHA (2022).

Figure 5: Funding by source, Venezuela
Sources. OCHA (2022)
of the funding, consistently accounting for more USD 1,300 per capita, to Syria, a country that
than 60% of humanitarian donations reported by has seen a smaller collapse in per capita income
the OCHA.88 In 2022, significantly higher U.S. do- than Venezuela. In 2022, Venezuela received
nations and significantly lower European Commis- funding for just USD 277 mn, 35% of the re-
sion donations resulted in the former accounting quired USD 795 mn, amounting to a paltry
for 61% of all HRP funding. USD 10 per capita.
Venezuela’s HRP is significantly underfund- Venezuela’s HRP is significantly underfund-
ed when compared to other humanitarian crises ed when compared to other humanitarian crises
and funding under the HRP is also low when and funding under the HRP is also low when
measured in per capita terms. From a broader measured in per capita terms. From a broader
perspective, Venezuela’s humanitarian crisis is perspective, Venezuela’s humanitarian crisis is
also one of the most underfunded in modern also one of the most underfunded in modern
history, with total international assistance since history, with total international assistance since
the start of the crisis reaching only USD 1.1 bn, the start of the crisis reaching only USD 1.1 bn,
or a meager USD 41 per capita. By comparison, or a meager USD 41 per capita. By comparison,
donors have directed USD 24 billion, or nearly donors have directed USD 24 billion, or nearly

Table 6: Comparison of OCHA HRP for recent humanitarian crises in 2022
HRP funding Funding per

HRP funding Plan funding
Country requirements capita
(USD mn) (%)
(USD mn) (USD)
Venezuela 795 277 35% 9.8

Afghanistan 4,442 3,295 74% 82.2
Ethiopia 3,335 1,689 51% 14.0
Myanmar 826 352 43% 6.5
Nigeria 1,127 787 70% 3.7
Somalia 2,599 851 33% 49.9
South Sudan 1,127 769 68% 71.5
Sudan 1,937 1,072 55% 23.5
Syria 4,444 2,301 52% 107.9
Congo Dem. Rep 1,882 973 52% 10.1
Yemen 4,272 2,215 52% 67.2
Sources: OCHA (2022) and World Bank.
USD 1,300 per capita, to Syria, a country that framework for the operation of NGOs, the prev-
has seen a smaller collapse in per capita income alence of paramilitary forces in certain areas of
than Venezuela. In 2022, Venezuela received the country and lack of detailed socio-economic
funding for just USD 277 mn, 35% of the re- information as the main factors that have con-
quired USD 795 mn, amounting to a paltry strained the flow of aid to Venezuela.
USD 10 per capita. While the U.S. government Overcompliance by financial institutions try-
has also contributed USD 503.4 mn, mainly ing to reduce their regulatory risk by altogether
through USAID, all of these funds have been avoiding exposure to Venezuelan entities occurs
destined to provide support to refugees outside despite the explicit humanitarian exceptions
the country but none to help alleviate the crisis embedded in sanctions. This overcompliance
in Venezuela. has many dimensions, in the channeling of dis-
Penfold and Arnson (2023) cite the Madu- bursements, procurement of materials, distribu-
ro administration’s unwillingness to relinquish tion of aid, engagement with beneficiaries and
control of aid delivery, donor lacking detailed evaluation of impacts. Humanitarian organi-
knowledge of the context in which NGOs op- zations frequently face difficulties in opening
erate on the ground, weak institutional cooper- bank accounts in the U.S., which they some-
ation among actors, overcompliance with U.S. times attempt to sidestep through cumbersome
sanctions by potential aid donors, adverse legal and inefficient informal mechanisms that seek

to avoid direct engagement with local provid- omy but rather to provide concrete assistance to
ers and beneficiaries. Providers also typically persons and groups facing situations of extreme
demand explicit letters of authorization by U.S. vulnerability. It is thus difficult to marshal the
authorities that are difficult to obtain. Distribu- amount of resources needed to confront a crisis
tion logistics within the country are complicat- caused by the collapse of oil exports through a
ed by prevalent corruption, fuel shortages and system of assistance based on donations. The to-
other elements of the institutional context. tal funding of USD 1.1 bn received so far would
While an increase in the flow of humanitari- be equivalent to only 11% of 2014 imports of
an aid could do much to alleviate the suffering of food and medicines and to 15% of the resourc-
vulnerable groups in the country, unlocking aid es that could be obtained yearly if the economy
should not in and of itself be seen as the cure to were to recover the approximately 400tbd of oil
Venezuela’s humanitarian crisis. Humanitarian exports to the U.S. lost as a result of 2019 eco-
aid is not meant to substitute for a nation’s econ- nomic sanctions.
Depoliticizing Foreign Aid
The Maduro administration has for long had a designated crossing points. However, the Madu-
complicated stance in regard to foreign aid, at ti- ro government, which claimed that the initiative
mes blocking its entrance to the country and ge- was a thinly veiled attempt at sparking an insur-
nerally restricting the operations of foreign hu- rection, responded by physically blocking the
manitarian agencies.89 This reticence to accept key transit points and deploying security forces
aid was originally anchored on a political refusal along the border, resulting in violent confronta-
to accept its need. Over time, the government tions.90
has become more willing to accept humanitarian The attempt to push humanitarian aid into
aid and recognize the magnitude of the coun- Venezuela was widely reported in the media and
try’s crisis. sparked intense debate and controversy. The
Political tensions around aid deliveries came Venezuelan opposition argued that the Maduro
to a dramatic climax when the Juan Guaidó in- government was denying the Venezuelan people
terim government attempted unsuccessfully to access to much-needed supplies, while the Mad-
force humanitarian aid supplies into the country uro administration characterized the attempt to
through the Colombian and Brazilian borders forcibly push it through the border as an effort to
in February 2019. The aid supplies were to be undermine its legitimacy.91 Some human rights
delivered through collection points outside the NGOs lamented what they saw as an attempt to
borders and transported into Venezuela through politicize the distribution of aid.92 As we will see

throughout this book, this type of politicization effort would be “similar to what is happening
of initiatives that could provide material benefits in Syria.” The move was a significant departure
to the Venezuelan people has been a recurrent from the previous official policy of the Maduro
theme over the last few years. government, as its representatives had repeatedly
In March 2019, the Red Cross announced denied the existence of a humanitarian crisis in
that it had received permission from both the the country. The Red Cross sought to prevent
Guaidó and Maduro administrations to begin the politicization of the aid effort by distributing
delivering humanitarian medical supplies. At medical supplies through the facilities it directly
the time, the organization said that the effort’s operates, thus bypassing the government’s offi-
rollout would begin in mid-April and that the cial distribution channels.93
Precedents in Cooperative Agreements

to Facilitate International Aid
In August 2020, the Pan-American Health ed between 1.4-2.4 mn AstraZeneca vaccine

Organization (PAHO) announced plans doses for distribution to Venezuela but the
to provide 370 thousand antigen tests to Maduro administration rejected them, instead
Venezuela. 94 The kits arrived in October 2020 favoring Chinese and Russian alternatives. 97
and were to be distributed as part of what The first lot was originally expected to arrive
was the first agreement between the Guaidó in May 2021, but the rejection and payment
and Maduro administrations to attend to problems delayed the arrival until September
the humanitarian crisis. The tests were paid of that year. Despite this, PAHO had distrib-
from funds previously frozen as a result of uted 16.8 mn vaccines in the country by March
U.S. sanctions. 95 However, as of January 2021, 2022. 98
only 3,000 tests were administered, according Delivery of the vaccines was a contentious
to a Bloomberg story. 96 The low utilization political issue as the Maduro government
rate led to recrimination among the sides, pressed for the release of frozen or blocked
with the government denying the reports of funds to pay for the vaccines, while the Guaidó
underuse and the opposition presenting them administration offered to pay for them itself. 99
as evidence that the government could not be An early deadline for payment to the mecha-
trusted to uphold agreements. nism was missed and, subsequently, a techni-
A similar accord to distribute COVID-19 cal commission integrated by members of the
vaccines through the COVAX mechanism was Venezuelan executive and legislature, along-
less successful. The organization had allocat- side UN PAHO support, was convened.

PRECEDENTS IN COOPERATIVE AGREEMENTS TO FACILITATE INTERNATIONAL AID
As a side note, Venezuela could have qualified cón by the end of the year and 1.5 mn across
for the subsidized purchase of the vaccines un- 11 states by 2022-23. By January 2022, the
der the Advance Market Commitment (AMC) WFP announced that it had distributed 156
cost-sharing arrangement if the country were thousand rations since the program began op-
classified as a low-middle-income country. 100 erating in July 2021. Each ration is meant to
However, the World Bank still classifies Vene- cover the nutrition requirements of a child for
zuela as a high-middle-income country on the a month and consists of 6 kg of rice, 4 kg of
basis of the latest officially-reported data for lentils, 1 pound of iodized salt, and 1 liter of
the country’s Gross National Income (GNI), vegetable oil. 103 While the WFP distributes the
corresponding to 2013. 101 Maldonado and Oli- meals at local schools, it directly manages pro-
vo (2022) estimate that Venezuela should have curement and distribution. By the initiative’s
been reclassified since 2018. Since GNI data first anniversary, distribution had expanded
is produced by the Venezuelan Central Bank to 3 additional states (Barinas, Trujillo, and
and the World Bank does not recognize either Yaracuy) and the organization was already
the Maduro or Guaidó-appointed central bank planning an expansion to another 5 in the next
boards, it is impossible to update this estimate 2 months. 104
under the current recognition impasse. A 2020 assessment by WFP concluded that
Regarding humanitarian aid, the U.S. gov- there were 2.3 million people in the country
ernment has insisted on placing the World affected by severe food insecurity and an addi-
Food Program (WFP) at the center of any tional 7 mn by moderate food insecurity (also
large-scale humanitarian assistance initiative. requiring assistance). 105 This suggests that the
The Maduro administration had in the past existing programs at the time were insufficient
proven wary of the WFP, which it saw as being to address the humanitarian crisis as related to
controlled by the U.S. due to its Executive Di- food security. Rodríguez (2023c) evaluated
rector, who is customarily a U.S.-nominee. A the Maduro government’s policy response to
major breakthrough in this regard came with the crisis, finding a major government effort
the April 2021 agreement between the WFP to increase food deliveries to families in need
and the Maduro administration to distribute – as demonstrated by a significant rise in the
take-home meals to children aged 6 months proportion of foodstuff in total imports – but
to 6 years, as well as school personnel and stu- also clear evidence that control of and access
dents with special needs. 102 to the system is politically biased and that
The program had an annual budget of USD government loyalists are more likely to bene-
190 mn drawn from the UN Venezuela Hu- fit from some of these programs than govern-
manitarian Response Plan and targeted reach- ment opponents. We come back to this issue in
ing 185 thousand children in the state of Fal- Chapter 6.

Recommendations
Depoliticizing humanitarian aid in Venezue- dle-income country status would facilitate the
la is crucial for ensuring that assistance reaches country’s application to international aid, debt
those in need without interference by political relief mechanisms, and other forms of foreign
interests in the highly polarized context of the assistance. Critically, a reclassification would
Venezuelan crisis. In the past, aid distribution require recognized authorities to submit updat-
was often slowed down or even blocked due to ed macroeconomic data to the World Bank. As
tensions between the government and the op- we elaborate more fully in chapter 4, we believe
position, which has contributed to exacerbat- this can be facilitated by a cooperative agree-
ing the suffering of the most vulnerable groups ment between the Maduro government and
in the country. To achieve depoliticization re- the opposition to deal with multilateral insti-
quires that all actors –including the opposition, tutions.
the Maduro government, and international However, ultimately, attending the Venezu-
players supporting either side– commit to put- elan humanitarian crisis successfully will criti-
ting the needs of the Venezuelan people above cally depend on recovering the country’s econ-
their political agenda. omy. As we have shown in the past few pages,
Aid must be distributed based on need rather the impact of even the most ambitious foreign
than political affiliation. To the extent that ca- aid programs pales in comparison to the poten-
pacity allows it, international organizations and tial for a well-designed program that enables a
domestic and foreign NGOs should be charged recovery of oil production for the benefit of all
with organizing the distribution of foreign aid, Venezuelans.
as well as auditing its non-political distribution.
Another critical point is securing more fund-
ing to attend to the Venezuelan humanitarian
crisis. Both the Maduro government and the
opposition can play a critical role in doing so
by working together and leveraging their re-
spective networks and diplomatic channels to
appeal for more funding from the international
community.
Reclassifying Venezuela from its current up-
per-middle-income country status to low-mid-

Sanctions as a Policy Tool
Sanctions have a long historical tradition, with doers and impose selective measures to constrain
their earliest documented use as policy tools dat- their economic transactions.107 As a consequence,
ing back to Athens in the 5th century BCE. They sanctions today increasingly consist of the listing
were initially employed as a complement to mili- of individuals and entities who are barred from
tary strategy and their negative impact on civilian international travel or conducting international
populations was both understood and intended. financial or commercial transactions, as opposed
In the aftermath of World War I, sanctions were to the blanket embargoes of previous decades.
reconceptualized as a possible alternative to mil- Besides the refinement in their application, we
itary action and incorporated into the covenant have also seen a significant increase in the use of
of the League of Nations as an option available to economic sanctions by some of the world’s most
dissuade members from settling disputes by force. important economies in recent decades. Their
Sanctions became increasingly common in the adoption is almost invariably framed in the con-
postwar period and were used for diverse purpos- text of attempts to deter or dissuade target gov-
es, including isolating the white-rule government ernments and individuals from actions claimed to
of Southern Rhodesia and responding to the Sovi- undermine global security, democracy, or human
et Union’s occupation of Afghanistan. rights.
One particularly controversial episode was the Modern sanctions can be characterized as ei-
imposition of economic sanctions on Iraq by the ther multilateral –when imposed by the UNSC
UN Security Council (UNSC) in the aftermath in response to threats to peace or acts of aggres-
of the invasion of Kuwait in 1990. As we explain sion– or unilateral –when imposed by countries.
in further detail in Chapter 3, these had a par- Unilateral sanctions are most often imposed by
ticularly strong negative effect on economic and the U.S. government, where Congress has par-
humanitarian indicators, which prompted wide- tially delegated authority to regulate commerce
spread political discussion over their justification. with foreign nations to the president in case of
The growing awareness of the unintended con- a national emergency. In practice, U.S. sanctions
sequences on civilians and third parties led to are effectuated through inclusion by the Treasury
a call for the development of “smart sanctions” Department’s Office of Foreign Assets Control in
more directly aimed at the actors whose change a list of Specially Designated Nationals, whose as-
of conduct was sought.106 The revamp spurred the sets under U.S. jurisdiction are blocked or frozen
emergence of vast national and international reg- and economic transactions with them are forbid-
ulatory architectures aiming to identify wrong- den for U.S. persons.

Rodríguez (2023a) illustrates the rise in the tions by the UN or western nations, and more
use of sanctions in recent decades by noting that than one-fourth of the world GDP is produced by
less than 4% of countries were subject to sanc- sanctioned countries.
tions from western nations or the UN in the early There is also a rising trend in individual or enti-
1960s, which has risen to 27% percent today. The ty-specific U.S. sanctions. During the first Obama
magnitudes are larger when measured as a share of administration, there was an average of 544 new
world GDP, as 4% of world GDP was produced designations to OFAC’s SDN list. That number
by sanctioned countries in the early 60s but more rose to 975 per year in the Trump administration
than 29% is today. In other words, more than one and has continued rising so far (to 1,151 per year)
fourth of countries are currently subject to sanc- during the Biden administration.
Effectiveness of Sanctions in Achieving their Objectives
Despite the existence of abundantly document- notes that sanctions can be used as “sticks” to in-
ed instances of sanctions, scientific literature crease negotiation leverage by threatening their
has failed to reach an overarching consensus on imposition or their strengthening. Alternatively,
whether they are effective policy tools and which sanctions can be employed as “carrots” by offer-
factors are involved in their effectiveness. The ing their removal or selective lifting in exchange
main reasons for this lack of consensus include for changes in behavior.
difficulties in quantifying critical aspects, such Hufbauer et al. (1990) pioneered the liter-
as the objectives of the country imposing them, ature attempting to assess the effectiveness of
the potential complexity of a sanctions regime, sanctions, documenting 116 sanctions episodes
and even the very definition of effectiveness. that occurred between 1914 and 1990, and find-
From an empirical point of view, one key ing a success rate of 34%. Besides pioneering
challenge in the literature has been to separate analysis on the subject, Hufbauer et al. (1990)
the effect of sanctions from other simultaneous also produced a dataset (the HSE dataset) and
treatments. In this regard, Biersteker (2015) definitions that many subsequent researchers
notes that sanctions are rarely deployed by them- would employ to look at the effectiveness of
selves; in 97% of the cases, they come alongside sanctions. Perhaps unsurprisingly, papers based
significant diplomatic efforts, in 59% of the on this dataset have converged to an assessment
cases with peacekeeping operations, in 55% of that sanctions are effectively less than a third of
the cases with the use of military force and in the time.108
47% of the cases with tribunal referrals. He also However, other datasets emerged in the fol-

EFFECTIVENESS OF SANCTIONS IN ACHIEVING THEIR OBJECTIVES
lowing years, including some that employ more likely to be successful when their policy goals
nuanced categories and definitions of success, are modest, when there are good relations be-
as well as other methodological refinements, tween the sanctioner and the sanctioned coun-
inspiring further development in the literature try prior to the sanctions, when the economic
and estimates of their success rate that are some- cost imposed by the sanctions is large, and when
how higher. the sanctioned country is more democratic.112
Morgan et al. (2014b) employed the Threat Kavakli et al. (2019) inscribes sanctions in
and Imposition of Economic Sanctions (TIES) a modern bargaining framework for policy
dataset109 and found a 45.9% success rate. Weber change, in which these are costly for both the
and Schneider (2019) used a modern combi- state imposing them (the “sender”) and its tar-
nation of previous datasets110 that accounts for get. Both sides attempt to maximize the cost to
episodes of sanctions and threats of sanctions the other and minimize the cost to themselves.
and found a success rate between 33.0-50.7%, A target will be less vulnerable to the economic
depending on the definition of “success” em- cost of sanctions if it is able to redirect its trade
ployed.111 Biersteker, et al. (2018) used the Tar- to new partners. Interestingly, autocratic re-
geted Sanctions Consortium (TSC) dataset, gimes that have a less diversified export portfo-
finding a success ratio of 22%. Felbermayr, et al. lio are more resilient to sanctions because their
(2020b) employed the Global Sanctions Data- higher control of the economy allows them to
Base (GSDB) producing an estimate of a success better weather their effect. The framework de-
rate of 30%. scribes well several features of the Venezuelan
The finding of a relatively poor success rate episode, including the country’s redirection of
is interesting yet leaves many open questions. oil exports to China, rising import of oil inputs
Ultimately a success rate is only meaningful if from Iran and the Maduro government’s use of
compared with a success rate in a counterfactu- political discourse to produce a “rally around
al scenario in which sanctions are not imposed. the flag” effect to shore up its support and re-
In other words, even if sanctions are success- duce support for its opponents.
ful in only one-third of cases, they may not be Effective targeting is a key consideration. Lek-
an unreasonable policy choice if the chances of tzian and Souva (2007) argue that sanctions suc-
obtaining success without sanctions were zero; ceed when the sanctioner can calibrate the sanc-
alternatively, if success is obtained in a third of tion in a way that most of the impact falls on the
cases even without sanctions, then the marginal target’s winning coalition, which may be harder
effect of sanctions would appear to be negligible. to do against an authoritarian regime, where the
A related strand of the empirical literature has winning coalition is smaller. Scholars have also
attempted to understand the correlates of sanc- highlighted the importance of multilateral coop-
tions success, finding that sanctions are more eration on sanctions effectiveness, which makes

it much more difficult for sanctions busters – position also became overly reliant on external
countries or entities that diminish the cost of the pressure as its main political tool, abandoning
sanctions for the targets, for political or econom- elections and even grassroots organizations for
ic reasons– to emerge.113 some time.
An additional key aspect for determining Another negative side effect of sanctions
sanctions’ odds of success is their timing. Huf- that can be observed in the Venezuelan episode
bauer et al. (2007) and Jeong (2018) posit a neg- is the consolidation of power in the hands of
ative relationship between sanctions’ duration the ruling elite. As the resources available to an
and their effectiveness, suggesting that sanctions economy become scarcer, ruling elites may gain
must be addressed to the target’s coalition quick- greater control over their distribution, especial-
ly and decisively so that incumbents cannot find ly when state-owned enterprises place such as
effective strategies to evade them. crucial role as the country’s main exporter.
U.S. sanctions on Venezuela have almost none Sanction busters –such as China, Russia,
of the characteristics of successful sanctions ep- India, and Iran– have also played a key role in
isodes, as the demands were not moderate, the the Maduro administration’s strategy to adapt
sanctions were unilateral, the countries were to sanctions or circumvent the key restrictions
hostile to each before the episode and there is imposed by them. Examples of adaptation with
no effective mechanism for voters to punish the the support of external actors include the use
government by voting it out of office. On top of of vessels without transponders (the so-called
this, sanctions have now been extended for more “shadow tankers”)114 and ship-to-ship transfer
than four years, and the Maduro administration hubs outside Venezuelan seas as ways to obfus-
appears to have fully adapted to life under these cate the origin of oil sold to commercially mo-
restrictions. tivated sanction busters, and also the smuggling
Sanctions may have even had the opposite ef- of gold through airplanes to unlikely trade allies
fect to that desired. Sanctions can strengthen a such as Iran, Libya, and Uganda.
targeted regime if they lead to situations in which Sanctions have also incentivized the Maduro
the authoritarian regimes can blame external administration to take a more market-friendly
actors for the country’s economic problems, approach to local policymaking, as the restric-
leading to increased nationalism and a rallying tion on PDVSA has incentivized the search for
around the government, and making it more new sources of rent beyond the oil industry. A
difficult for opposition groups to gain traction. notable milestone in this regard is the enact-
This has arguably been the case in Venezuela, ment of the Anti-blockade law in late 2020,
where the Maduro administration has tried to which dedicates little over half of its statutes to
blame the full breadth of the economic crisis economic reform and improving conditions for
on the U.S. government. The Venezuelan op- investment and the respect of investment con-

tracts, with a strong emphasis on secrecy provi- taliation and criminal prosecution based on hu-
sions to protect the confidentiality of foreign man rights violations if they were to leave office.
partners.115 The government has also become The literature also underscores the fact that
increasingly tolerant of the use of foreign cur- it is the deterrent effect of sanctions threat that
rency bills for domestic retail transactions and is often most effective. The actual imposition of
even for some limited banking activities. sanctions is more often an admission of failure
In the early phases, the key problem in the in that it shows that the targeted actor was not
design of sanctions on Venezuela was their max- dissuaded. Maintaining the threat is important
imalist target. By focusing on regime change in terms of credibility –which is key to the deter-
under the Trump period, sanctions backed the rent effect in other cases– but it may not neces-
Maduro administration into a corner, giving it sarily achieve much in the specific case in which
little option but to hold on to power to avoid the sanction is imposed, where the deterrence of
the enormous costs associated with political re- the threat has, in the end, proved unsuccessful.
Collateral Damage to the General Population
Understanding the impact of economic sanc- economic sanctions on socio-economic indica-

tions is crucial for evaluating the costs associat- tors to date, finding a remarkable level of con-
ed with their use as policy tools. Economic sanc- sensus on the conclusion that sanctions have
tions are often used as a tool for foreign policy, strong negative and often long-lasting effects on
but they can also lead to economic hardship for the living conditions of the majority of people
ordinary citizens, particularly low-income or in target countries. The work identifies 32 stud-
marginalized segments of the population. This ies applying quantitative, econometric, and cal-
assessment can also assist in designing plans to ibration methods to cross-country and national
mitigate their most important unintended nega- data on the subject. Of these, 30 studies found
tive consequences, be that through the provision that sanctions have negative effects on the vari-
of humanitarian aid or humanitarian programs able of interest, 1 found ambiguous results, and
involving the targeted relaxation of the restric- 1 claimed that sanctions had a positive effect.
tions imposed by them. Evaluating the impact of The diverse studies reviewed in Rodríguez
sanctions is also relevant to assessing their long- (2023a) measure the effects of sanctions on
term viability as policy tools. economic –GDP growth, income inequality,
Rodríguez (2023a) presents a comprehensive poverty, trade flows, oil production– and hu-
survey of quantitative studies on the impact of manitarian –child nutrition and mortality rates,

COLLATERAL DAMAGE TO THE GENERAL POPULATION
public health, life expectancy– variables, as well Neuenkirch and Neumeier (2016) find that
as on the security and abuse of human rights, the U.S. and multilateral sanctions are associated
prevalence of democratic conditions, and the in- with the worsening of the poverty gap. The
cidence of terrorism in targeted countries. effect grows over time, so that an economy
As noted above, the surveyed studies found that is sanctioned after 21 years would see its
negative effects of sanctions on the variables in poverty rate rise by 14 p.p. Afersorgbor and
consideration except for two. Gutmann et al. Mahadevan (2016) also find a significant neg-
(2018) evaluated the effect of U.S. sanctions on ative effect on inequality, as sanctions episodes
human rights, ambiguously finding a deteriora- increase the Gini Coefficient by 1.7 points,
tion of political rights but an improvement in while each additional year of sanctions adds
women’s emancipatory rights. 0.3 points to the Gini.
Equipo Anova (2021) provides the singular Petrescu (2016) estimates that being exposed
instance of positive effects, reporting a statisti- to sanctions during the whole duration of preg-
cally significant increase in imports of food and nancy leads to a decrease of .07 standard devi-
medicines associated with the adoption of U.S. ations in a child’s weight, approximately one-
financial sanctions towards Venezuela in 2017. sixth of the expected effect from being exposed
However, Rodríguez (2022d) reviewed the to war, one-third that of having no electricity
work, finding that the results are a consequence and two-thirds that of not having access to med-
of data coding errors and questionable method- ical care. Gutman, Neuenkirch, and Neumeier
ological choices. (2017) find that UN sanctions are associated
Among the studies surveyed, Neuenkirch with a decrease in life expectancy of 1.2 years
and Neumeier (2015) found a 2.0 p.p. reduc- for men and 1.4 years for women, while U.S.
tion in yearly growth associated with the impo- sanctions are associated with a smaller decline
sition of multilateral sanctions, but a statistical- of 0.4 years for men and 0.5 years for women.
ly weaker and numerically smaller 0.9 p.p. effect Ha and Nam (2022) estimate that a sanctions
from unilateral U.S. sanctions. Importantly, the episode leads to a decline in average life expec-
study found that these effects persisted for as tancy of 0.3 years.
long as 10 years, resulting in cumulative GDP Petrescu (2016) estimates that being exposed
declines of 26% and 13% for multilateral and to sanctions during the whole duration of preg-
unilateral sanctions, respectively. Gutmann, nancy leads to a decrease of .07 standard devi-
Neuenkirch, and Neumeier (2021a) revisited ations in a child’s weight, approximately one-
the subject, finding that sanctions are associat- sixth of the expected effect from being exposed
ed with a drop in GDP per capita of 4% during to war, one-third that of having no electricity
the first 2 years of an episode, with no evidence and two-thirds that of not having access to med-
of recovery even 3 years after sanctions lifted. ical care. Gutman, Neuenkirch, and Neumeier

Table 7: Summary of cross-country panel data and country-level studies
Outcome Data
Authors Results
variable coverage
Hufbauer et Economic
Average cost to target of comprehensive sanctions regimes is
al, (1985, 1990, cost to target Cross-country
4.2% of GDP.
2007) countries
The most severe UN sanctions lead to an increase in the
Human Rights
Wood (2008) probability of repression from 5% to 25%; for U.S. sanctions Cross-country
Abuses
the increase is to 16%.
Physical inte- Economic sanctions lead to significant increases in human
Peksen (2009) grity rights of rights violations in all measures of physical integrity conside- Cross-country
citizens red as well as in aggregate indices.
Sanctions lead to a 7% reduction in the average Freedom
Peksen and
Democracy House democracy score the year after sanctions are imposed, Cross-country
Cooper (2010)
an effect that rises to 16% in the case of extensive sanctions.
Under-five A one-standard deviation increase in the cost of sanctions
Peksen (2011) child mortality leads to 4 percent increase in mortality. U.S. sanctions lead Cross-country
rates to a 35 percent increase in mortality.
Sanctions that have a large economic effect on target states
Allen and Lekt- can have severe public health consequences. These conse-
Public health Cross-country
zian (2012) quences are substantively similar to those associated with
major military conflicts.
Incindents of
Choi and Lio The imposition of sanctions leads to a 93% increase in inci-
international Cross-country
(2013) dents of international terrorism.
terrorism
UN sanctions cause 2.0% decline in growth at time of san-

Neuenkirch and Economic
ctions, rising to a cumulative 26% over 10 years. U.S. sanctions Cross-country
Neumeier (2015) growth
lower growth by 0.9% and cumulative 13%.
Afesorgbor and A sanctions episode increases the Gini coefficient by 1.7 poin-
Income Ine-
Mahadevan ts, while each additional year of sanctions adds 0.3 points to Cross-country
quality
(2016) the Gini.
Protection against loss of life and torture is 1.7 times more

Lucena and
Human Rights likely to worsen under targeted sanctions than under no san-
Apolinário Cross-country
Abuses ctions. The effect of targeted sanctions is not different from
(2016)
that of conventional sanctions.
Weight, height
Being exposed to sanctions during the whole duration of a
and probabili-
Petrescu (2016) pregnancy leads to a decrease of .07 standard deviations in a Cross-country
ty of death of
child’s weight.
children
U.S. sanctions lead to increases in the poverty gap by 3.8 % of

Neuenkirch and
Poverty gap GDP. The effect grows to 7.9% for most severe sanctions and Cross-country
Neumeier (2016)
is reinforced with multilateral support.

Table 7: Summary of cross-country panel data and country-level studies (continuation)
Outcome Data
Authors Results
variable coverage
HIV infections, Sanctions episodes lead to an increase in the HIV infection
Kim (2019) aid-related rate of children by 2.5% and an increase in AIDS-related Cross-country
deaths deaths by 1%.
Unilateral sanctions lead to increases in energy imports, as

Wen et al Energy im- do U.S. sanctions, economic sanctions, and greater sanctions
Cross-country
(2020) ports intensity. Plurilateral, EU and UN sanctions have no signifi-
cant effects.
Trade flows
The imposition of sanctions leads to a 77-82% decline in
Dai et al (2021) between coun- Cross-country
bilateral trade.
tries
The imposition of economic sanctions reduces average life

expectancy by 0.3 years. The effect is present only for trade
Ha and Nam Life expectan-
and other sanctions. Countries with more developed finan- Cross-country
(2021) cy
cial systems and institutions are better able to alleviate the
effect of sanctions on health.
UN sanctions are associated with a decrease in life expectan-

Gutmann et al. Life expectan-
cy of 1.2 years for men and 1.4 years for women, while U.S.
(2021) cy for males Cross-country
sanctions are associated with a smaller decline of 0.4 years
and females
for men and 0.5 years for women.
Splinter and Growth collap- The likelihood of experiencing a growth collapse rises by 9%
Cross-country
Klomp (2021) ses in the first three years after sanctions are imposed.
International sanctions slow GDP growth in the first (2.2 pp)

and second (1.8 pp) years of a sanctions episode. The effect
Growth in
Gutmann et al. seems to be mostly caused by US unilateral sanctions and
GDP and its Cross-country
(2021) financial sanctions, and operates through a decline in Foreign
components.
direct investment, which drops by 39% in the first year of an
episode of sanctions.
Overall human US economic sanctions are associated with a deterioration

rights, basic of political rights but an improvement in women’s emancipa-
human rights, tory rights. The effect on emancipatory rights comes from
Gutmann et al
economic sanctions that are not targeted at human rights goals and
(2023) Cross-country
rights, emanci- that are imposed unilaterally by the US, while multilateral
patory rights, and human-rights targeted sanctions are not associated with
and political improvements in women’s rights but are associated with
rights deteriorations in political rights.

Outcome Data
Authors Results
variable coverage
Political outco-
mes, GDP, oil
Sanctions lead to a decline in GDP that is statistically significant
Van Bergeijk and gas rents,
only in the short term. Sanctions have no statistically significant Iran
(2015) government
effect on democracy either in the short nor long term.
consumption,
imports.
Macroecono-
Sanctions lead to a decline in total imports by 20%, total expor-
Farzanegan et mic Variables
ts by 16.5%, private consumption by 3.9%, capital income by Iran
al. (2016) and Hou-
3.8% and GDP by 2.2%.
sehold welfare.
Iran, Libe-
GDP Growth,
Warburton Sanctions detrimentally affect the target’s macroeconomic ria, Rwan-
Exports/GDP,
(2016) performance. da, Sierra
Inflation.
Leone
Sanctions caused a 17.3 percent decline in real GDP in 3 years.
Gharehgozlia
Real GDP The higest effect of the sanctions took place 2012, with a 12.0 Iran
(2017)
percent drop.
The authors focused on sanctions designed to stop human

rights violations through 3T mines in DRC. They found that Five
Parker et al. infant mortality rates rose in villages that depend economically eastern
Child mortality
(2017) on armed groups. Also, they found that infant mortality rates Congo
increased in villages that depend economically on “conflict-free” provinces
minerals.
Kholodilin and
Sanctions had a weak negative effect on the growth rate of Russia and
Netšunajev GDP Growth
Russian GDP. euro area.
(2018)
Rodríguez Venezuelan oil Financial sanctions are associated with losses in oil revenues of
Venezuela
(2019) production USD 16.9 billion per year.
Sanctions reduce trade with the target, with an effect that is

Felbermayr et International
economically significant and heterogeneous across countries Iran
al. (2020) trade
and sectors.
Essential
Financial sanctions are associated with an improvement in
Equipo ANOVA goods imports
imports of essential goods but an acceleration in the rate of Venezuela
(2021) and oil
decline in oil production.
production
Sanctions caused a 12.5% fall in Iran’s real GDP in the first
year and a 19.1% decline 4 years after the application of the
Morteza (2021) Real GDP Iran
sanctions, while real GDP remained 5% lower than its counter-
factual 2 years after the removal of sanctions.

Outcome Data cove-

Authors Results
variable rage
Sanctions caused a significant increase in food prices. The
Food prices,
Hejazi and share of urban and rural households that were prone to food
food security
Emamgholi- insecurity increased from 8.8% and 25.2% to 11.2% and 29.2%, Iran
and dietary
pour (2022) respectively,
quality
from 2017 to 2019.
Sanctions caused large losses in oil production among firms

that had acces to finance prior to sanctions compared to a
Rodríguez Venezuelan oil
control group that lacked that access. The effect of sanctions Venezuela
(2022) output
explains around half of the output drop observed in those
firms.
Sources. Adapted from Rodríguez (2023a, 2023d).
(2017) find that UN sanctions are associated

with a decrease in life expectancy of 1.2 years
for men and 1.4 years for women, while U.S.
sanctions are associated with a smaller decline
of 0.4 years for men and 0.5 years for women.
Ha and Nam (2022) estimate that a sanctions
episode leads to a decline in average life expec-
tancy of 0.3 years.
Dai et al (2021) find that complete trade
sanctions –those that apply to imports and ex-
ports as a whole– lead to a 77% decline in bilat-
eral trade. They also find that declines in trade
tend to precede the imposition of sanctions by
up to ten years, and that trade reverts slowly
to pre-sanctions levels over a 7–8-year period.
Controlling for these effects, however, increases
the point estimate of the contemporaneous ef-
fect of trade on sanctions to 82%.

Recommendations
As we have shown in the preceding pages, tion, a reevaluation of their cost/benefit is cru-
there is a remarkable consensus among all the cial. The country is in what may be described as
cross-national studies that economic sanc- the early stages of a new political negotiation
tions generate significant levels of distress in process between the government and the op-
target economies. These are reflected in lower position. This process is accompanied by what
growth, higher likelihood of economic collaps- appears like a significant shift in the Biden ad-
es, increases in poverty and inequality, worsen- ministration’s strategy towards the country.
ing health conditions, many excess deaths, and While our approach is not normative, we
deteriorations in human rights and democra- do note that there is a broad range of opinions
cy. Estimates of the effectiveness of sanctions among authors regarding the legitimacy and
in producing the desired changes in behavior morality of sanctions. Some of these authors
are also not encouraging and an analysis of the have characterized them as a form of collec-
correlates of their success does not improve the tive punishment of civilians that is in viola-
case for their application to Venezuela. tion of international law, similar to the use of
In fact, some of the economic and humanitar- siege warfare, which is currently considered
ian impacts of sanctions on target populations a war crime.119 Others have argued that only
may be intentional. For example, a statement is- well-targeted sanctions, properly designed to
sued by the UK government after freezing assets protect vulnerable populations, should be per-
of the Russian central bank in February 2022 missible.120 Yet others characterize the pain im-
stated unambiguously that “sanctions will dev- posed on the populations living under targeted
astate Russia’s economy.”116 in February 2019, regimes as necessary collateral damage justified
Secretary of State Mike Pompeo stated that by the ability of adequately designed sanctions
“Things are much worse for the Iranian people, to achieve their objectives.121
and we are convinced that will lead the Iranian Reforming the sanctions regime in place
people to rise and change the behavior of the requires a careful and honest evaluation of
regime.” 117 Pompeo made similar statements the costs and potential rewards of the existing
about US sanctions in Venezuela, the following framework. Besides basing any decision on the
month.118 best available scholarly work on the subject, a
Given the ineffectiveness of sanctions on redesign of sanctions must tackle some of the
Venezuela in the four years since their imposi- most crucial mistakes incurred over the past

few years. Largely ineffective humanitarian
exceptions to sanctions are often used to mis-
leadingly claim that sanctions do not impede or
create obstacles to humanitarian assistance. By
design or omission, regulatory ambiguity gen-
erates incentives for generalized de-risking by
private sector actors – who can cause consider-
able damage to the economy and population by
avoiding various commercial interactions with
sanctioned countries even if there are “excep-
tions” that would allow them. These “excep-
tions” allow officials to characterize the prob-
lem as one of “over-compliance” rather than
one of inadequate institutional design.
Finally, policymakers must understand that
any attempt to attend to the Venezuelan hu-
manitarian crisis to any meaningful degree
will require helping the country rehabilitate its
economy and regaining access to international
trade and financial markets.

Endnotes
70
BBC News Mundo (2017).
71
Figueroa (2019a).
72
Jiménez (2022).
73
Maia and Paraguassu (2018), Grattan (2019), Reuters (2021b).
74
Due to the relatively high costs associated with acquiring a passport and the long delays resulting from the coun-
try’s slow bureaucratic process, low-income Venezuelan migrants face significant difficulties in obtaining new pass-
ports or renewing their expired ones, which has become a significant problem in Venezuelan migration. See Olmo
(2018) and Alcalde (2022).
75
Embajada de México en Venezuela (2023).
76
Cancillería de la República de Ecuador (2018).
77
Ibañez et al. (2022).
78
Hoffman and Batalova (2023).
79
CBS Miami Team (2022).
80
UNHCR (2022).
81
Human Rights Watch (2022).
82
Department of Homeland Security (2022).
83
Rodríguez (2022e).
84
Trenee (2023).
85
IMF (2022).
86
OCHA (2022).
87
OCHA (2019).
88
OCHA (2019)
89
Llamas et. al. (2019).
90
BBC News (2019b).
91
Llamas et al. (2019).
92
Toosi (2019)
93
Kurmanaev and Herrera (2019).
94
Organización Panamericana de la Salud (2020).
95
Al Jazeera (2020).
96
Yapur (2021).
97
Reuters Staff (2021a).
98
Organización Panamericana de la Salud (2020).

99
Souquett (2021).
100
World Bank (2021), Souquett (2021), Gavi, the Vaccine Alliance (2021).
101
Maldonado and Olivo (2022).
102
World Food Programme (2021).
103
World Food Programme (2022a).
104
World Food Programme (2022b).
105
World Food Programme (2020).
106
Cortright and Lopez (2002).
107
Nephew (2017).
108
Hufbauer, Schott and Elliott (1990) (2007), Biersteker, et al. (2018), Weber and Schneider (2019), Felbermayr, et
al. (2020a).
109
Morgan, Bapat and Kobayashi (2014b).
110
The EU, UN, and US sanctions in the Post-Cold War period (EUSANCT) dataset
For the sake of comparability, we refer to the authors’ success rates of cases in which sanctions were only threat-
111
ened and not actually imposed. Without this exclusion, the success rate is in a higher 40.8-57.7% range.
112
Dashti-Gibson et al. (1997); Letktzian and Souva (2007); Hufbauer et al. (2007), Kavakli et al. (2020).
113
Martin (1992); Drezner (2000); Miers and Morgan (2002); Drezner (2003); Bapat and Morgan (2009); Es-
cribà-Folch and Wright (2010).
114
Goodman (2019).
115
BBC News Mundo (2020).
116
UK government (2022).
117
Human Rights Watch (2019).
118
Weisbrot (2019).
119
Shagabutdinova and Berejikian (2007), United Nations (2019), Zakrison and Muntaner (2019)
120
Cortright and Lopez (2000b, 2002), Fabre (2018).
121
Nephew (2017) and Hausmann and Morales-Arilla (2021).

Chapter 3
Oil-for-Essentials Initiatives
In broad terms, oil-for-essentials proposals for the attempted to quantify the effect of sanctions, the
Venezuelan crisis seek to improve the general wel- topic remains controversial. In the following pag-
fare of the population by leveraging the potential es, we first track the evolution of oil production
for increases in oil production that would result before and after sanctions and then survey key re-
from PDVSA regaining access to global oil markets. search studies on the primary variables explaining
Venezuela’s oil sector output has fallen 63% since its behavior. We then follow by presenting, analyz-
the U.S. first imposed financial sanctions on the ing, and comparing different proposals to loosen
country in late August 2017, which translates to sanctions on PDVSA aimed to fund humanitarian
USD 36 bn per year in lost revenues at current pric- initiatives and draw conclusions on how the debate
es, approximately two times our estimate for Vene- has produced rich alternatives.
zuela’s total imports in 2022.122
Multiple competing theories attempt to explain
this decline but, by most accounts, both the 2017
financial sanctions and the 2019 trade sanctions
played at least some role in the collapse of the Ven-
ezuelan oil industry. While several studies have
OIL-FOR-ESSENTIALS INITIATIVES 79
The Collapse in the Venezuelan Oil Industry
Between 2008 and 2015, Venezuela’s oil production four months of the year. Oil output fell 34tbd (1.8%)
was stable, oscillating in a narrow range of 2,320 tbd- in September, 29 tbd (1.5%) in October, 74 tbd (4%)
2,378 tbd for an average of 2,334 tbd.123 This stability in November, and an enormous 152 tbd (8%) in De-
came despite a sharp decline in international oil prices cember. Production ended the year at 1,647 tbd, a full
at the end of the commodities supercycle, starting in 387 tbd (19%) below the end of 2016.
the second half of 2014. The Brent oil basket had been As noted, most of the decline in production
trading above USD 100/bbl for most of the 2011-13 seen in 2017 came in the last four months. Two
period but began declining in the second half of 2014 key events took place in close succession around
and finished the year 43% down to USD 63/bbl. Oil this time, which has made the assessment of their
continued declining in 2015 and hit a bottom in the relative significance a hotly debated topic. First, on
mid-30s during January 2016. August 24, the Trump administration imposed fi-
Venezuelan oil production began declining in early nancial sanctions impeding the Venezuelan govern-
2016 at an average monthly rate of 1% and ended the ment and state-owned firms from accessing inter-
year at 2,034 tbd, 324 tbd, or 14%, down year-on-year. national credit markets. These were implemented
The pace of decline fell somewhat in the first 8 months through Executive Order 13808,124 which banned
of 2017, averaging 0.6% of lost production per month U.S. persons from participating in certain transac-
for a total 5% decline, but accelerated again in the last tions (see table 8).
Table 8: Transactions forbidden by Executive Order 13808
Id Transactions forbidden
1 New debt with a maturity greater than 90 days with PDVSA.
2 New debt with a maturity greater than 30 days, or new equity, of the government of Venezuela.
Bonds issued by the government of Venezuela previous to the date of the order, except those
3 listed in an annex (in practice, only VENZ 2036, which was fully held by Venezuelan government
institutions, was excluded from this list).
Dividend payments or other distributions of profits from Venezuela-controlled entities (including

4
U.S.-based PDVSA branch CITGO).
5 The purchase of new securities from the government of Venezuela.
Sources. U.S. Treasury Department (2017).

THE COLLAPSE IN THE VENEZUELAN OIL INDUSTRY
The second event was PDVSA’s default on its shipments in 2018 went to the U.S. (up from
foreign bonds on November 13.125 Some authors 48% in 2016 and 44% in 2017). That changed
argue that the imposition of sanctions was redun- in January 2019. Maduro had won reelection
dant (in regard to the company’s access to financ- in presidential elections held on May 2018 that
ing) because the company was already excluded were considered invalid by the U.S. and dozens of
from financial markets beforehand.126 However, countries. They had been boycotted by the main
Rodríguez (2022a) contends that PDVSA still opposition parties, and their results were not
retained access to foreign financing through Spe- recognized by the losing candidate. On January
cial Purpose Vehicle (SPV) arrangements, which 23, 13 days after Maduro’s swearing-in, Nation-
allowed foreign partners to finance joint venture al Assembly President Juan Guaidó announced
operations, and by refinancing arrears with service that he would assume the powers of the presiden-
providers through the issuance of New York law cy. In a matter of hours, 24 countries including
promissory notes. Both mechanisms were banned the United States and 11 members of the Lima
by the sanctions, thus effectively shutting down Group (a coalition of Latin American countries
any remaining access to international financing. whose foreign policy stance was supportive of
Furthermore, sanctions also prevented the com- the opposition), had announced that they would
pany from restructuring its debt. recognize Guaidó as the legitimate interim presi-
Regardless of the interpretation of these dent of Venezuela. Then, on January 28, the U.S.
events and their causal relation, the company’s Treasury included PDVSA in the OFAC’s Spe-
loss of access to funding had a clear detrimental cially Designated Nationals list, imposing a de
effect on the company’s production. Modern fi- facto ban on oil trade with Venezuela.
nance is commingled with a set of other activities In 2018, the U.S. imported 586 tbd of crude
that are essential to production, including access oil and petroleum products from Venezuela and
to trade credit. The 2017 financial sanctions exported back 124 tbd in petroleum products –
carved out exceptions for trade credit of under mostly to be used as diluents to upgrade Venezu-
90 days, but there is substantial evidence that ela’s extra heavy oils.127 Both flows fell to zero in
these exceptions were far from sufficient to pro- the aftermath of the January 2019 decision. Vene-
tect trade-related loans. In 2018, production fell zuela’s oil production fell at an average rate of 4%
at a 3% monthly average rate for a total decline during the year, for a total 437 tbd (37%) decline,
of 475 tbd (29%) and ended the year at 1,172 and ended 2019 at 735 tbd. Most of the drop
tbd. This fall came despite oil prices recovering came in February (130 tbd or 11%) and March
31% on average. (276 tbd, 27%), just after the January sanctions.
While production declined sharply between In the first quarter of 2019, Venezuela experi-
2016-2018, PDVSA continued selling crude to enced two major power outages: the first lasting
the U.S. market. In fact, 55% of Venezuela’s oil 105 hours and beginning on March 7 and the
second lasting 95 hours and beginning on March lized at around 750 tbd until the eruption of the
25. Two more major blackouts occurred in April COVID-19 pandemic in March 2020 precipi-
and July, for a total of 235 hours of blackout or tated a plunge in international oil prices below
9.8 days. While there is evidence indicating that USD 40/bbl (from USD 65/bbl at the end of
the blackouts impacted oil industry in the short 2019) and further declines in Venezuela’s oil pro-
term, we also know that output failed to recover duction to levels as low as 337 tbd (54% against
even after electricity supply normalized. This sug- the end of the previous year) by June. From then
gests that a blackout-driven explanation for the on, production recovered gradually and ended
long-term collapse, as was tentatively provided at 2021 at 718 tbd (a 287 tbd increase over Decem-
the time by Hausmann and Muci (2019), is not ber 2020). After that, it has largely stagnated at
consistent with the data. Furthermore, as Rodrí- just above 700 tbd.
guez and Rodríguez (2019) have argued, sanc- Around this time, OFAC designated Rosneft
tions in themselves contributed to the blackouts Trading and one of its subsidiaries, TNK Trad-
by impeding the diesel imports needed to activate ing International, in its SDN list for operating in
backup plants as well as blocking transactions in the oil sector of the Venezuelan economy.128 Soon
promissory notes issued to pay suppliers of parts after, it also designated several entities of a Mexi-
used in the country’s hydroelectric plants. co-based network accused of facilitating Venezue-
After the March blackouts, production stabi- la’s efforts to evade sanctions.129
Figure 6: Venezuela’s oil production (OPEC Secondary Sources, TBD)
Source. Own elaboration based on OPEC: Monthly Report.

Explaining Declines and Quantifying the Room for Recovery
This section discusses the results of existing share of the decline to the effect of sanctions but,
quantitative research that seeks to identify the effect employing its estimate of the difference in the rate of
of sanctions on oil production. Understanding how decline before and after the sanctions, we can attribute
much of production was lost to sanctions can also an implicit estimate of 468 tbd (36%) lost between
serve to help us understand the magnitude of the August 2017 and August 2018.
potential scope for recovery in case of a lifting of Weisbrot and Sachs (2019) extended the argument
sanctions. Evidence from other cases of sanctioned presented by Rodríguez (2018), arguing that sanctions
oil producers suggests that the lifting of sanctions is locked in the decline in production by preventing a
typically associated with relatively rapid recoveries stabilization program, contributing significantly to the
in production to pre-sanctions levels. Therefore, our 31-pp increase in general mortality observed between
survey of estimates of the impact of sanctions on 2017 and 2018. It, however, does not offer an original
Venezuela’s oil industry can serve as a rough guide to estimate of the impact of sanctions on oil production.
the space for recovery of production available to fund Hausmann and Muci (2019) responded to the
oil-for-essential initiatives. preceding arguments by questioning the selection
Rodríguez (2018) first pointed out that the of Colombia as a counterfactual, positing that oil
adoption of financial sanctions coincided with the production would still have declined in the absence
acceleration of the rate of decline in the country’s oil of sanctions and further claiming that the 2019
production and identified two turning points in its drop in oil output was caused by the March electrical
trajectory. The first came as oil prices dipped to a 13- blackouts. Morales (2019) proposed that the
year low of USD 21.6/bbl in early 2016, prompting increased participation of military personnel without
a decline in oil output given the industry’s relatively technical expertise in key management roles in the
high marginal cost of production, which made some oil industry was the key explanatory variable for the
barrels unprofitable. The second turning point came decline in production. Bahar et al. (2019) argued that
in late 2017, as financial sanctions cut PDVSA’s access production shows strong pre-existing trends before
to financing and prevented a potential restructuring the imposition of sanctions, which they claim explains
of its foreign debt, resulting in an accelerated rate of its post-sanction trajectory. None of these works
decline in production. The author compares this rate produced a specific estimate of the share of the decline
of decline to that of neighboring Colombia, which attributable to each factor; in fact, Bahar et al. (2019)
had a similarly high marginal cost of production and suggest that it is impossible to precisely estimate that
whose production exhibited a similar behavior before number given the multiple set of confounding forces
the 2017 sanctions but remained stable after 2017. operating at the time.
The article does not attempt to attribute any specific Rodríguez (2019) responded to the arguments
EXPLAINING DECLINES AND QUANTIFYING THE ROOM FOR RECOVERY
in the preceding paragraph by deploying an array sanctions.

of statistical estimation techniques to evaluate Rodríguez and Rodríguez (2019) linked the
the effect of both financial and oil sanctions. . intensity and duration of electrical blackouts to the
First, he shows that the conclusions in Rodríguez restriction on importing diesel for thermoelectric
(2018) are invariant to the selection of Colombia generation from the U.S. Thermoelectrical generation
as a counterfactual by applying a differences-in- in Venezuela acts as a backup for hydroelectric facilities
differences fixed-effects regression on pairwise and sanctions restrict the import of spare parts and
comparisons of Venezuela with 36 other oil- financing necessary to maintain and repair the power
producing countries, attributing a 689 tbd decline generators. They conclude by noting that the primary
from August 2017’s production to financial cause of the blackouts lies in underinvestment in
sanctions. The author then applies a synthetic the industry, but that sanctions contributed to
control method to build a long-run adequate perpetuating its effect by preventing necessary repairs.
counterfactual, attributing a 797 tbd (40%) decline, This suggests that the blackouts of early 2019 – and
observed between August 2017 and December the loss of oil production that they generated – could
2018, to the initial financial sanctions. Rodríguez have been partly a consequence of sanctions rather
also uses an alternative approach, estimating panel than an alternative cause of the decline in oil output.
regressions on data from 38 oil exporting countries It also highlights how impediments in trade can have
attributing a 467-507 tbd (40.6%-44.0%) decline affected the economy’s productivity by depriving it
between January and April 2019 to oil and financial of essential imported inputs, rather than just export
sanctions.130 markets.
In a later paper, Rodríguez (2023c) uses a Oliveros (2020) provides a survey of previous
difference-in-differences approach on firm-level analyses, concurring with earlier assessments that 2017
data to test the effect of sanctions on the credit financial sanctions had contributed to the declining oil
channel for oil-producing firms in Venezuela’s production by restricting PDVSA and its JVs’ access
Orinoco Basin. This method assesses differences in to financial and commercial credit. He also argues
performance between firms that had lost access to that the 2019 sanctions negatively affected the oil
international financing before the 2017 sanctions industry by restricting export access to the U.S. market,
and those that retained it through Special Financing increasing the discount on Venezuela’s crude, and
Vehicle (SFV) mechanisms which allowed them to increasing the cost of importing necessary oil products
receive direct loans from foreign minority partners that act as inputs to PDVSA’s output. He quantifies
in joint ventures. Under this approach, the author the effects of sanctions by generating counterfactual
produces a broad range of estimates, ranging from scenarios in which production continued to decline at
255 to 637tbd, depending on assumptions about its 1% per month pre-sanctions trend, estimating that
which firms would have been granted access to Venezuela had lost between 597 and 1,012 tbd by July
SPV arrangements if they had not been barred by 2020 due to the effect of the 2017 financial sanctions.

Table 9: Survey of the estimated impact of sanctions on oil production
Thousand % of % of post- % of
Author Event Estimation tecnique Sample Period barrels per initial sanctions total
day output decline decline
Difference-in-differences
Rodríguez 2017 Whole August 2017 to
with Colombia as a -468 -24.2% 67.2% 41.1%
(2018) sanctions country August 2018
counterfactual
Differences-in-differences
fixed effects regression on
2017 August 2017 to
pairwise comparisons of -689 -35.6% 58.7% 42.6%
sanctions May 2019
Venezuela with 36 other
oil-producing countries
Rodríguez
Whole
(2019,
country August 2017
2023a) 2017
Synthetic Control to December -797 -41.2% 104.3% 66.1%
sanctions
2018
January 2019 to -572 -49.7% 79.5%

2019
Cross-country Panel Data December
sanctions
2020 -594 -51.6% 82.5%
Linear extrapolation,
lower bound (2% MoM -597 -30.8% 37.2% 29.4%
decline)
Linear extrapolation, mid

Oliveros 2017 Whole July 2017 to -786 -40.6% 49.0% 38.7%
range (1.5% MoM decline)
(2020) sanctions country July 2020
Linear extrapolation,
upper bound (1% MoM -1.012 -52.3% 63.1% 49.8%
decline)
Equipo August 2017

2017 Regression Discountinuity Whole
Anova to December -698 -33.2% 58.5% 37.4%
sanctions Analysis country
(2021) 2019
Difference-in-differences Orinoco -235 -41.4% 46.1% 42.0%

Rodríguez 2017 August 2017 to
approach with firm-level Basin
(2022) sanctions June 2020
data SFVs -276 -48.5% 53.9% 49.3%
Median estimates -597 -41.2% 58.7% 42.0%
Source. Own elaboration
EXPLAINING DECLINES AND QUANTIFYING THE ROOM FOR RECOVERY
Equipo Anova (2021) uses an interrupted time Besides production-volume gains, there is also a
series to estimate the effect of sanctions through less frequently discussed point regarding prices. U.S.
changes in the level and slope coefficients at the time sanctions forced PDVSA to resort to increasingly
of the August 2017 financial sanctions. They attribute opaque practices to sell its output, which often involves
a cumulative decline of 698 tbd between August 2017 selling oil through intermediaries with a limited track
and December 2019 to sanctions by approximating record in crude marketing, generating operational
the break in trend in oil output at the time of their problems such as non-payment by disreputable buyers.
imposition. Note that the Rodríguez (2022d) Losses derived from non-payment led to a highly-
criticisms of the Equipo Anova (2021) results are publicized corruption investigation resulting in the
focused on the estimates of the effect of sanctions on arrest of dozens of public officials and the resignation
food and medicine imports and not on their estimates of Tareck El Aissami as oil minister in March 2023.132
of effects on oil production discussed here. Besides resorting to these intermediaries, the
The extent of the recovery in oil output would company also increased its shipments to distant
crucially depend on the modality under which markets in Asia, while abandoning its natural market
sanctions are relaxed or lifted. Full removal of sanctions in the U.S. Gulf Coast. Adding to these factors,
could result in a recovery in line with some of the higher PDVSA is increasingly facing competition from the
estimates presented in our survey but a more limited, now-sanctioned Russian oil in these opaque Chinese
company-specific, authorization to resume business in markets. As a result, Venezuelan oil has been reported
Venezuela would result in production gains closer some to trade at a significant discount to what its quality
of the lower estimates presented, or even below them. alone would justify (which itself could improve if
In November 2022, OFAC issued General License higher-quality U.S. diluents became available). In
41,131 allowing Chevron to significantly increase the June 2022, Reuters reported that some traders were
scope of its operations in Venezuela. Up until that demanding as much as USD 47/bbl discounts against
time, Chevron – the sole American company directly the Brent basket for Venezuela’s crude.133 Previously,
involved in extracting and selling Venezuelan oil – had the news agency had reported discounts between
been restricted to performing activities necessary for USD 35-38/bbl. In contrast, the Organization of the
maintaining or winding down essential operation Petroleum Exporting Countries (OPEC) reported
but was barred from producing or selling Venezuelan the discount on Venezuela’s Merey basket at an average
oil. The new license allows transactions related to the of USD 23/bbl for the first five months of 2022.134
production, lifting and sale of Venezuelan oil into the The extent to which buyers demand these extremely
United States, as well as the purchase and importation high discounts is unclear. Lacking the necessary data to
into Venezuela of the intermediate inputs needed to ascertain whether discounts reported by the press are
carry out these activities. While the move is certainly representative of the average price at which PDVSA
significant, its quantitative impact on Venezuela’s oil sells its oil, we employ OPEC’s reference price for
production has so far been limited. Merey as our baseline reference.

Using average 2022 values for Venezuela’s oil recovery estimate of 637 tbd would take the valuation
production and the price of the Merey crude results to USD 28.1 bn (+93%). However, if we also assume
in a valuation of the potential gains from the lifting that regularization of trade with the U.S. would result
of U.S. oil sanctions at USD 14.6 bn per year. Adding in a reduction of the discount applied to Venezuelan
our lower-bound recovery estimate of 255 tbd would crude to that reported by OPEC in 2017 (USD 7/
push this to USD 20.0 bn (+37%). Our upper-bound bbl), our valuation of the average 2022 production
Table 10: Estimated gains from lifting oil sanctions

Gains
Lower- Upper- attributable
bound bound to discount
valuation valuation reduction
(USD mn)
2022 average production (tbd) 688 688
Price of Brent Basket (USD/bbl) 80 80
Discount to Brent (USD/bbl) 22 7
Discounted price (USD/bbl) 39 54
Annual value of production - Current level (USD mn) 14,567 18,332 3,765
Lower-bound recovery (additional tbd) 255 255
Oil production - Lower bound (tbd) 943 943
Value of additional production - Lower bound (USD mn) 5,398 6,794 1,396
Annual value of production - Lower bound recovery (USD mn) 19,965 25,126 5,161
Upper-bound recovery (additional tbd) 637 637
Oil production - Upper bound (tbd) 1325 1325
Value of additional production - Upper bound (USD mn) 13,485 16,973 3,488
Annual value of production - Upper bound recovery (USD mn) 28,052 35,305 7,253
Source. Own elaboration based on OPEC monthly report data.
would rise to USD 18.3 bn (+26%), our lower- it allows Venezuela to regain access to the U.S.
bound recovery valuation would rise to USD 25.1 market for its oil exports. Part of this evidence
bn (+72%) and our upper-bound recovery valuation comes from previous experience with sanc-
to USD 35.3bn (+142%). These give us a wide range tioned countries in which data shows a very
of the value that can be gained by lifting restrictions large drop in oil production in the months
applied to Venezuelan oil production. after these are implemented and a very quick
There are reasons to believe that oil produc- recovery once they are lifted or relaxed. We
tion could recover significantly from its cur- highlight three key examples: Iraq in the ’90s,
rent levels under an oil-for-essentials program Iran in the ’00s, and Syria in the ‘10s.
or a direct unconditional lifting of sanctions if The experience in Iraq, which we examine
Figure 7: Iraq’s oil production, 1987-2014 (TBD)
Source. Own elaboration based on EIA (2023)
in further detail in the next section, started These restrictions were lifted in January 2016,
in August of 1990 when the UNSC imposed and output subsequently recovered completely.
oil sanctions in the aftermath of Saddam In May 2018, the U.S. reimposed secondary
Hussein’s invasion of Kuwait. While the sanctions on Iranian oil sales, leading to a
sanctions remained in place up until Hussein’s decline of a similar proportion to the 2012
fall in 2003, the oil embargo was significantly episode. It’s worth noting that most of Iran’s oil
relaxed under the UNSC’s Oil-for-Food exports currently go to Asia, making the threat
Program (OFFP), first implemented in 1996. of secondary sanctions very relevant. During
Oil output fell 87% in the year of sanctions the periods covered in this figure, the U.S.
and remained low until the implementation of exempted several of Iran’s trading partners from
the OFFP, after which it recovered almost all these sanctions, as long as they committed to
the lost ground. significantly reducing oil imports from Iran.
In the case of Iran, multilateral sanctions were In the aftermath of the March 2011 Syrian
imposed in 2012 as a response to the country’s protests, the U.S. imposed financial sanctions and
development of nuclear weapons. Output fell an oil embargo on the country in August 2011,
by approximately 20% after the EU banned oil aiming to “deprive the regime of the resources
imports from Iran and the U.S. implemented it needs to continue violence against civilians
secondary sanctions on countries trading with it. and to pressure the Syrian regime to allow for

Figure 8: Iran’s oil production, 2010-2019 (TBD)
Source. Own elaboration based on EIA (2023)
a democratic transition.”135 In September 2011 different measures from the prohibition on

the EU, Syria’s largest export market at the oil purchases made by the UNSC in the Iraqi,
time, followed with its own oil embargo on the Iranian, and Syrian cases. However, they have
country.136 In the 5 years preceding sanctions, the same practical implication of generating a de
Syria’s oil output had been relatively stable, facto oil embargo because the state lost access to
oscillating just below 400 tbd. U.S. sanctions the means necessary to sell oil in international
were followed by a 36% fall in oil production markets. Oil output fell 72% in March and
in September. Oil output continued to decline continued falling until August. In September,
at a slower pace over the next year, ending the Security Council lifted the sanctions
2012 at 129 tbd, 68% below its pre-sanctions against the NOC and the central bank, and
level. By the end of 2013, production had production began recovering, regaining pre-
reached just 25 tbd, a 94% decline against pre- sanction levels by mid-2012.
sanctions levels. As of 2022, the oil embargo
has not been lifted.
In March 2011, the UN Security Council
imposed asset freezes on the Libyan central
bank and the country’s national oil company
(NOC). Note that strictly speaking, these are
Figure 9: Syria’s oil production, 2008-2022 (TBD)
Source. Own elaboration based on Bloomberg Terminal.
Figure 10: Libya’s oil production, 2010-2012 (TBD)
Source: Own elaboration based on Bloomberg Terminal.

Precedent: The UN’s Oil-for-Food Programme in Iraq
Most oil-for-essentials proposals for Vene-
zuela trace their inspiration to the UN’s Oil- •UN member states were allowed
for-Food Programme for Iraq Implemented in to import crude oil and oil products
1996. The program came to be in the aftermath originating in Iraq, as well as conduct
of Saddam Hussein’s August 1990 invasion of connected financial and other essential
Kuwait during the first Gulf War. 137 As a result transactions, for a maximum aggregated
of the invasion, the UN Security Council im- sum of USD 1 bn every 90 days. This
plemented an embargo on trade and financing was expanded to USD 5.3 bn every 6
by its member states, resulting in a humanitar- months in February 1998 139 and the
ian crisis in Iraq. While the occupation lasted restriction was lifted in December
less than a year, the embargo remained in place 1999. 140
as a way to pressure the Iraqi government to •The Iraqi national oil company
comply with UN efforts to end its weapons of negotiated directly with prospective
mass destruction programs until Hussein’s re- buyers, but final authorization required
moval in 2003. 138 approval by the Sanctions Committee
Iraq’s real per capita GDP contracted by upon a detailed application, including
66% in 1991 and remained at 51% down by purchase price and export route, to
1995 (the year before the beginning of the guarantee transparency. Observers
OFFP). This contraction came as oil produc- reporting to the committee conducted
tion fell 80% to 580 tbd from 2,945 tbd. On monthly pricing reviews.
the humanitarian side, the collapse of external •Full proceeds were deposited in
revenues led to a 76% fall in food imports and escrow accounts under the control of
a 26% fall in the domestic food supply. Wide- the Secretary General of the UNSC.
spread concern over the ensuing humanitarian Authorization of disbursements from
crisis led the UNSC to implement the pro- these required a guarantee that the
gram. government would equitably distribute
Iraq’s OFFP was created by UNSC Resolu- the goods according to plans approved
tion 986 of April 1995, further laid out by a by the Secretary-General. Sanctions
memorandum of understanding between the Committee members had an effective
government of Iraq and the UN Secretariat veto on transactions.
signed on May 1996 and modified by several •A portion of the proceeds was
other UNSC Resolutions. Implementation de- assigned for related expenses, including
tails were as follows: funding compensations to Kuwait for
the war, and covering the operational 3.4 bn barrels of oil, generating
and logistical costs of the program revenues of USD 64.2 bn. In the 7 years
(including inspection costs), as well as following the implementation of the
those of the oversight committee. program, GDP expanded 179% (16%
•The government of Iraq directly per year) as oil production surged back
negotiated with suppliers of 252% to 2,040 tbd in 2002. These
humanitarian goods, but imports results were mirrored by a 220% rise
were restricted to a list including in food imports and a 43% rise in the
“medicine, health supplies, foodstuffs, domestic food supply.
and materials and supplies for essential
civilian needs.” The arrival of the The program has nonetheless been criti-
imports to Iraqi territory was verified by cized in various ways. Gordon (2020) argued
UN-appointed third parties. that the U.S. and UK continued to block the
•Distribution in most of the country import of critical complementary and “dual
was done through a rationing scheme use” 143 goods. Among these, Gordon high-
that pre-dated the program. The UN lights refrigeration systems needed to safely
handled distribution directly to three transport medicines, power generators re-
Kurdish northern cities which were quired to run a water treatment plant import-
not under the control of the Saddam ed under the program, and dual-use items such
Hussein government. as fertilizers, pesticides, and animal vaccines.
•A 1998 UNSC resolution authorized The author also concedes that the problem
the disbursement of USD 300 mn for ameliorated after UN staff took over the per-
oil infrastructure investment, 141 which mission process in 2002.
was then doubled two years later. 142 Nevertheless, the program was also associat-
•Transactions were authorized for a ed with a major corruption scandal and serious
180-day period, which was renewed 12 problems of implementation, which prompted
times upon the completion of periodic several inquiries, hearings, and investigations
reviews by a Sanctions Committee. both by the UN and U.S. authorities. In 2004,
•Oil exports conducted under the UN Secretary General Kofi Annan appoint-
program were made immune from ed an Independent Inquiry Committee head-
attachment by creditors and other ed by former Federal Reserve Chairman Paul
parties. The program resulted in a Volcker to investigate corruption allegations.
notable improvement in economic The next year, the committee released its final
and humanitarian metrics. During the report, commonly dubbed the “Volcker Re-
program’s thirteen phases, Iraq exported port.” 144 The investigation found that the key

PRECEDENT: THE UN’S OIL-FOR-FOOD PROGRAMME IN IRAQ
implementation deficiency of the program was •Despite its large quantity in absolute
allowing the Iraqi government to select both terms, the corruption-associated
the buyers of its oil and the suppliers of hu- slippage was minor relative to the
manitarian goods. The Hussein government significant benefits in macroeconomic
used this prerogative to route illicit income and humanitarian metrics, as the
to accounts outside UN supervision through deviated illicit funds amounted to just
surcharges on exported oil (USD 229 mn) 3% of total exports under the program.
and kickbacks in the import of humanitarian •Initially, a lack of political will to
goods (USD 1.5 bn). A contemporary inquiry implement the program – primarily
by the CIA on Iraqi weapons of mass destruc- from the Iraqi government, which
tion, which produced the “Duelfer Report,” believed sanctions would be lifted due
also found an additional USD 8.0 bn in illicit to humanitarian concerns – led to a
income obtained by trading with neighboring very long 5-year delay from its initial
countries outside of the program, but this re- approval by the UN to the actual
sulted from a failure in embargo monitoring, implementation. Afterward, imports
rather than from the OFFP itself. 145 under the program remained slow and
Beyond providing illicit income, the scheme cumbersome due to significant red
also allowed the Hussein administration to as- tape in the procurement authorization
sign oil sales in exchange for political favor process.
from traditional oil companies, UN officials,
foreign politicians, and political lobby orga-
nizations, among others, to sway attitudes to-
wards the country.
Iraq’s experience under the UN OFFP re-
veals three key insights that should serve as
lessons for the design and implementation of
any future program inspired by it:
•Most of the mechanisms employed

by the Hussein government to extract
illicit incomes or assign profitable
transactions for political favor directly
result from the decision to allow the
Iraqi government to freely select its
trade partners under the program. 146
Oil for Venezuela:
A Humanitarian Oil Agreement for Venezuela
The first-fully fledged proposal for an staked a claim on the legitimate representa-
oil-for-essentials program to attend the Vene- tion of the executive power in Venezuela, a
zuelan crisis was released in October 2019 by claim that was backed by key international al-
the Oil for Venezuela foundation. 147 Oil for Ve- lies, including the U.S., but rejected by allies
nezuela is a non-profit organization operating of Nicolás Maduro, such as China and Russia.
as a think-tank that develops sustainable me- The political situation informed the program
chanisms to address and prevent the deepening designed advanced in the proposal, which
of Venezuela’s humanitarian crisis. aimed at providing a venue for building trust
The NGO’s proposal aimed to mitigate the between the sides by fostering cooperative
collateral effects of the loss of access to the 400 behavior.
tbd plus U.S. market for Venezuelan oil result- The Oil for Venezuela proposal attempted
ing from the 2019 oil sanctions, which led to a to leverage a crucial difference in the Iraqi and
drastic decline in external revenues and, con- Venezuelan political situations to address key
sequently, to the country’s ability to carry out problems in the OFFP design: while in the for-
imports of essential goods. mer case the head of the executive branch was
The study took the conservative approach of undisputedly held by Saddam Hussein, that
only attributing the 416 tbd oil production loss of Venezuela was subject to competing claims
between January and August 2019 (equivalent by Maduro and Guaidó. This fact remains the
to around USD 9 bn per year at current prices) source of significant difficulties relating to
as the effect of sanctions, thus ignoring losses court representation and diplomatic relations,
resulting from the 2017 financial sanctions. At but also provides an opportunity to find mu-
the time, oil production, according to OPEC tually beneficial arrangements by requiring the
secondary sources, had fallen to 735 tbd, not consensus of both sides. In a way, the compet-
far from the 693 tbd average for the first 5 ing claims from both administrations provid-
months of 2022. However, almost 3 years have ed a valuable opportunity to imbue a check-
passed since the publication of the study and and-balance system into the program design,
a part of these losses may have become more as both sides have incentives to safeguard the
difficult to recover due to the intervening lack implementation transparency and keep watch
of investment. over the other side.
At the time of publication, the president Among the main characteristics of the pro-
of the National Assembly, Juan Guaidó, had gram were those presented in Table 11.

Table 11: Main characteristics of the program
Id Main characteristics of the program
The program would be initiated with a Memorandum of Understanding between the Guaidó administration, the
1
Maduro administration, and the UNSC, in which the parties agree on rules and mechanisms.
The U.S. government would issue a General License permitting U.S. persons to participate in activities related to
the program, including the import of Venezuelan oil and investments in Venezuelan infrastructure, but requiring
the proceeds to be deposited in special U.S.-based escrow accounts. Authorization could be granted for 6-month
2
periods, renewable upon review. The U.S. government would retain the ability to impose secondary sanctions on
entities that do business with the Maduro government outside of the program and SDN-designated individuals
would be banned from participation.
The program would be governed by an Administrative Board integrated by 5 designees of the Maduro administra-
tion, 5 designees of the Guaidó administration, and 3 representatives appointed by the UNSC. The latter would
bring international expertise to the table and serve as impartial actors to, among other things, break deadlocks
3
between the representatives of both administrations and mediate controversies. This would also have the advanta-
ge of ensuring that the composition of the administrative board would be acceptable to allies of both Guaidó and
Maduro since both sides have veto power in the UNSC.
The Administrative Board would decide on substantial matters relating to the program’s rules and their broad
4 interpretation under a consensus basis and approve specific import/export contracts under a “no-objection” rule to
guarantee the necessary expediency.
The Administrative Board would appoint a technical Advisory Committee incorporating representatives from
pertinent UN Agencies and task it with drafting a report on the most urgent humanitarian needs to stabilize the
5
Venezuelan situation. The report would specify the humanitarian priorities and the associated required amounts to
address them to propose a general distribution of export proceeds.
Administrative Board members, Advisory Committee members, and representatives of the Venezuelan executive
6 and legislative branches of government, as well as the Comptroller General’s office, would be granted unrestricted
access to all information, statistics, and physical facilities related to the program’s operations.
In consideration of the report submitted by the Advisory Committee, the Administrative Board would draft and
7 approve by consensus a List of Permitted Imports under the program and a general 6-month proceed distribution
plan that sets priorities in relation to the requirements set in the Advisory Committee report.
The Administrative Board would appoint a technical Sales Committee, integrated primarily by qualified professio-
8 nals with experience in the Venezuelan oil industry, including current and former PDVSA employees. The Commit-
tee would be tasked with organizing open auctions for the sale of Venezuelan oil under the program.
The Administrative Board will designate a Procurement Committee, integrated by qualified Venezuelan profes-
sionals with experience in public procurement and social assistance. The Procurement Committee would draft a
detailed 3-month procurement plan based on the Advisory Committee report and the Administrative Board’s List of
9
Permitted Imports and a 6-month proceed distribution plan. The Procurement Committee would open a tender for
the required items and import contracts would be assigned to the best bidders in attention to the price, quality of
the offered goods, and the international reputation of the bidder.
The Administrative Board will designate a Distribution Committee, integrated by qualified Venezuelan professionals
with experience in humanitarian aid agencies or the food and pharmaceutical distribution systems. The Advisory
Committee would issue a report detailing the recommended distribution of the imported items aiming to maximi-
10
ze its beneficial impact over those segments of the population most requiring them. Distribution would combine
subsidized direct relief distribution by UN Humanitarian agencies and non-subsidized distributions to private sector
retail businesses.
The Administrative Board would contract independent inspectors, reporting to it, and be tasked with validating the
11
shipped volumes exported under the program and the appropriate contract pricing.
In principle, the Oil for Venezuela proposal presidency. Furthermore, despite a long-running
is general enough for its scope to be adaptable conflict of powers between the legislative and ju-
to a wide range of different policy targets. These dicial branches of government which had led the
could range from a production and export au- supreme court to find the National Assembly in
thorization for a specific firm all the way to a contempt and render its decisions invalid, there
comprehensive lifting of oil sanctions subject to was no dispute as to the validity of the mandate
depositing proceeds in escrow accounts. Howev- of the National Assembly elected in 2015. Today,
er, the proposal design requires significant sur- in contrast, there are two competing legislatures
veillance and administrative resources, which – the one elected in 2015AN and the one elected
would likely make it less practical for small-scale in 2020 – that claim to hold that mandate. On
programs covering a limited amount of oil bar- the other hand, Juan Guaidó no longer claims
rels. the presidency, although the U.S. has yet to rec-
Oil for Venezuela’s 2019 proposal was to a ognize the Maduro administration as legitimate.
large degree designed to address and exploit the This evolution in the context merits a recon-
institutional and political arrangement as it ex- sideration of some design decisions in order to
isted when it was published. At the time, both broaden its applicability to a range of different
Juan Guaidó and Nicolás Maduro contested political arrangements.
the legitimate representation of the Venezuelan
Boston Group: Venezuelan Oil Sale Mechanism for the

Execution of Humanitarian Projects Through the UN
The Boston Group was born in the early 2000s as a an programs that it would fund. As in the preceding
multi-party dialogue instance integrated by members programs, proceeds would be deposited in an escrow
of the U.S. and Venezuelan legislatures to debate poli- account set up by the UN.
cy in a depolarized manner.148 While the group is no Unlike the Iraqi precedent and Oil for Venezuela’s
longer a formal inter-parliamentary commission, it proposal, the Boston Group stresses the temporary
subsists as an informal venue for dialogue that produ- and exceptional nature of their solution. As such, their
ces policy proposals for Venezuela. proposal is less ambitious: its authors estimate oil ex-
In June 2021, the group presented its own take ports under the program between 2.0 and 3.5 million
on an oil-for-essentials initiative, which puts foreign barrels per month, equivalent to 67-117 tbd or USD
joint venture partners in charge of marketing the oil 1.5-2.6 bn per year at current prices.
and the UN in charge of managing the humanitari- Governance would be assigned to a Consultive

Board composed of three members from the Maduro •Supporting healthcare workers via direct
administration and three members of the Venezuelan transfers or other mechanisms.
opposition, one member of the Boston Group aligned •Supporting child nutrition at schools.
with the former block, one member of the Boston •Supporting vulnerable segments of the
Group aligned with the latter block and one member population, including female heads of
chosen by the preceding eight. This board would be household and the elderly.
tasked with continuously surveilling the program’s im-
plementation, disseminating information regarding Compared to the Oil for Food proposal, the Bos-
its operations, and mediating between the parts. ton Group takes a more restricted view of the poten-
The group recommends an initial duration of one tial venues through which additional external revenue
year, renewable on agreement by the parties, and stip- can benefit the general population. It seeks to fund
ulates that participating joint venture partners would specific humanitarian initiatives instead of providing a
require OFAC authorization to operate within the framework to improve the general welfare of the pop-
program. ulation. Partly because of this, it targets only a limited
increase in oil production and exports.
The study identifies 5 areas of humanitarian Unlike later proposals, described below, the mech-
priority: anism would require substantial administrative re-
sources and an involved political negotiation to estab-
•Acquisition of vaccines: primarily against lish and maintain a consultive board, yet the proposal
COVID-19, which the group envisioned does not fully take advantage of the building of new
would initially be carried out through the institutionality due to its limited scope. In this sense,
COVAX mechanism, and then against other it carries the primary disadvantage of a broad-scoped
diseases through the PAHO. ambitious design without having its potential for
•Improving clean water and electricity supply large-scale impact.
for medical facilities.
Atlantic Council: Exploring Humanitarian Frameworks

for Venezuela
The Atlantic Council is a non-partisan think-tank influential global leaders. The Council has a Ve-
that aims to influence American leadership in nezuela Working Group (VWG) that seeks to
global affairs by generating policy ideas, publi- inform policymakers across Latin America, Eu-
shing research, and leveraging its network of rope, and the U.S. on key policy issues relating to
the country. The VWG is integrated by high-level •UN oversight was incapable of preventing
members from academia, multilaterals, and present illicit behaviors in practice, despite
and former officials and legislators from the Venezue- sophisticated mechanisms on paper.
lan and U.S. governments. •The UN could not manage the program
In March 2022, the VWG published a policy brief effectively and its procurement practices were
reviewing previous proposals to leverage oil wealth inconsistent.
in Venezuela for humanitarian aims and presented •The program was designed as a short-term
its own analysis and recommendations.149 Like the solution, but extended for a very long period,
Boston Group, the VWG emphasizes the temporary resulting in a progressive deterioration of
and exceptional nature of the program. Unlike previ- governance.
ous proposals, it emphasizes legal aspects related to •The pressure for humanitarian relief led to
its implementation. For instance, the review explic- a large tolerance margin for the program’s
itly highlights the need for proposals to elaborate shortcomings, which were regarded as a “lesser
on tax, royalty, and dividend distributions, where- evil.”
as previous proposals implicitly assumed that these
would be paid into escrow accounts. It also explicitly From these observations, the report concludes
emphasizes that an OFAC license would have to au- that a program for Venezuela should account for the
thorize operational and capital expenditures within complexities of political negotiation between stake-
the joint venture itself. holders, the unique role of the U.S. in the imposition
The VWG does not offer an explicit assessment of sanctions, and the program’s role in a broader hu-
of the potential impact of an oil-for-essentials pro- manitarian strategy.
gram, but notes that “at the current price, limited oil
volumes—at the level that current joint ventures can The report then goes on to review the Oil for Ven-
produce in the short term—could yield large revenues ezuela proposal noting that:
for Venezuela.” •Its complexity can be a major handicap
As in previous works on the subject, the policy brief given the difficulties in creating the necessary
begins by reviewing Iraq’s experience with the OFFP oversight apparatus.
of the mid-90s, noting “…positive—but still limited— •Support of the proposal could be politically
humanitarian impacts.” The group identifies 5 design costly for U.S. stakeholders and the Venezuelan
failures in the implementation of the UN’s OFFP: interim government due to comparisons with
Iraq’s OFFP.
•The excessive reliance on the Iraqi •There are “diverging viewpoints on sanctions
government for the sale of oil and the adjustments within Venezuela’s broader
procurement of humanitarian goods resulted democratic coalition.”
in opportunistic behavior and illicit revenues.

ATLANTIC COUNCIL: EXPLORING HUMANITARIAN FRAMEWORKS FOR VENEZUELA
Regarding the Boston Group proposal, the penditures and would pay taxes, royalties, and divi-
Venezuela Working Group notes that: dends into escrow accounts that would fund humani-
tarian initiatives. Naturally, foreign partners would be
•The proposal does not explicitly account required to provide full transparency on production,
for fiscal liabilities that reduce joint venture sale, pricing, and revenues.
profits, and how these would flow to the The VWG frames its proposal in general human-
Venezuelan government within the scheme. itarian principles (neutrality, impartiality, and inde-
•The proposal is limited to synthetic crude, pendence) and directly links it to negotiations in Mex-
as natural crude cannot be legally exported ico, noting that a political agreement is a prerequisite
by foreign partners under current legislation. for “avoiding or reducing partisan interference across
This limits its potential impact due to the low the humanitarian mechanism, especially in the selec-
volumes of synthetic oil production. tion of beneficiary programs and the agreement’s exe-
•More generally, the VWG suggests that the cution.” To do so, they propose “equal representation
proposal would be enriched by expanding from actors across the political spectrum, civil society,
on the legal aspects of implementation and and the international community” and the distribu-
addressing hurdles related to the export of tion of humanitarian aid through established human-
natural crude. itarian organizations. It also stresses the importance of
local gas production in alleviating electricity shortages
Based on their analysis of the previous two propos- and suggests payment-in-kind for gas through OFAC
als, the VWG suggests a program design with a more licensing.
limited scope that revolves around OFAC authori- Importantly, the VWG states that a program
zations, foreign joint venture partners, and existing “should not aim to address structural challenges in
multilateral programs. An example would be an ar- Venezuela’s oil industry or the broader economy or
rangement in which OFAC authorizes existing joint facilitate public-private agreements with the Maduro
venture partners to export Venezuelan oil to fund administration that fail to comply with humanitarian
COVID-19 Vaccines Global Access (COVAX), the principles and could result in malpractice.” They go
Humanitarian Response Plan 2021, and WFP ini- on to emphasize that their proposal is meant to be a
tiatives. One purported benefit of this would be that short-term endeavor.
programs with a limited scope would be more accept- While the VWG report claims that it is not pre-
able to some stakeholders (including the U.S. govern- senting a new proposal but rather laying out some
ment and the UN). general principles, those principles convey some very
Marketing of oil exports would be carried out di- specific recommendations on how to organize the oil
rectly by the foreign partner in Venezuelan oil-sector marketing process, the procurement and distribution
joint ventures. These would be allowed to use a share of humanitarian goods and the structure for program
of the sale proceeds for operational and financial ex- oversight. As explained above, the group suggests that
multinational oil companies sell the oil, that a gover- decreasing) the space for corruption by creating addi-
nance structure appointed by political agreement al- tional freely-disposable cash flows for PDVSA.150 The
locates the funds to be used by international organiza- author also adds that restricting the scope of the pro-
tions and humanitarian groups, and that the program gram to existing humanitarian programs would rule
be completely governed by OFAC licenses, making out increasing key imports of essential goods if there
the U.S. Treasury Department its effective overseer. isn’t an active international agency planning to bring
The group argues that permitting private joint ven- them to the country. Finally, the author criticizes the
ture partners to market the oil produced as part of the outsized role that OFAC would play in oversight un-
program would streamline the sale process. The VWG der this design, noting that this is an arrangement that
hopes that cutting out the need for a bureaucratic ap- both the agency and Venezuelan stakeholders would
paratus to manage the commercial aspects of the pro- find objectionable.
gram would result in a more transparent mechanism Restricting the scope of an oil-for-essentials pro-
that would be less susceptible to corruption. gram to production under joint ventures would lim-
Rodríguez (2022b) responded to the VWG pro- it its potential impact. This is partly by design, as the
posal by noting that Iraq’s OFFP failed precisely VWG aims strictly at funding multilateral humani-
because there were areas (such as oil sales and distri- tarian programs only, precluding the potential to in-
bution) that were not subject to program oversight crease the supply of imported goods and distribute
and that the VWG design would increase (instead of them through private-sector mechanisms.
OFAC Licensing and Partial Agreements
The Russian invasion of Ukraine in February 2022 re- tional oil company) and Repsol (Spanish oil company)
vived the debate about reintegrating Venezuelan and to resume oil-for-debt swap operations with PDVSA,
Iranian crude into the international oil market by lo- which the companies had discontinued in September
osening existing sanctions. In March, the U.S. banned 2020 under U.S. government pressure.151 The agree-
oil imports from Russia and the EU followed with a ment allowed the companies to market Venezuelan oil
ban on oil imports by sea, resulting in a significant di- to Europe and deduct PDVSA’s share of the sale from
sruption of oil markets and a large rise in prices. The the debt owed to them, but reexports were banned
Brent crude basket rose to an average of USD 112/bbl and the U.S. government emphasized that Venezuela
in 2Q22, up from USD 98/bbl tbd in 1Q22 and USD would not receive additional revenues from the oper-
80/bbl in 4Q21, leading to concerns of inflation in de- ation.152 The authorization came in the form of a let-
veloped nations. ter of no-objection in which the U.S. committed not
In May, OFAC authorized Eni (an Italian multina- to impose secondary sanctions for participation under

OFAC LICENSING AND PARTIAL AGREEMENTS
the modality. PDVSA owed EUR 566 mn to Eni153 already been some material changes in this regard, the
and EUR 318 mn to Repsol154 by the end of 2022, ac- Biden administration has continued to emphasize that
cording to each company’s latest Annual Report.155 any further relaxation of sanctions would be condi-
According to Bloomberg data, PDVSA hadn’t tioned on improvements in democratic governance in
shipped oil to Europe since September 2020 but the country.
shipped 88.3 tbd (USD 187-250 mn) in June 2022 In May 2022, the Biden administration authorized
and 31.9 tbd (USD 56-79 mn) in July 2022 as a result Chevron to conduct exploratory discussions with the
of OFAC’s authorization.156 PDVSA then suspended Maduro administration and PDVSA to increase its
oil-for-debt swaps in August. Sources quoted by Re- role and output in joint ventures.160 Chevron is a vital
uters said that “PDVSA wants to go back to oil [for foreign partner for PDVSA, as it holds minority shares
products] swaps, and that is not possible yet […] There’s in four joint ventures with the company that produced
zero interest in the oil-for-debt deals.”157 The lack of in- 222 tbd (14% of Venezuela’s output) in 2018 but
terest is unsurprising, given that debt owed to Europe- was down to 150 tbd in 2022.161 Sources quoted by
an (and American) oil companies would otherwise not Bloomberg in May 2022 said that the company could
be paid, which means the deal brings little short-term boost production to 200 tbd within 6 months, 300
benefit to the Venezuelan government and would rep- tbd by 2023, and 500 tbd by 2026-27. While Chev-
resent a loss of actual cash flow if implemented more ron’s joint ventures never reached 300 tbd in the past,
broadly. However, PDVSA resumed deliveries to Eu- it is plausible that if the U.S. company took operational
rope in November 2022 with 66.7 tbd (USD 134 mn) control, it could exceed its historical ceilings.
in shipments,158 after which supply was intermittent.159 The U.S. government loosened restrictions on
From a humanitarian perspective, these authoriza- Chevron by issuing General License 41 (GL 41),162
tions have little to no impact on general welfare within which allows transactions related to the production,
Venezuela. Oil-for-debt agreements allow PDVSA to lifting and sale of Venezuelan oil into the U.S., as well
decrease its liabilities to foreign partners but do not reas the purchase and importation into Venezuela of the
sult in additional income that can be spent on imports. intermediate inputs needed to carry out these activities.
The agreement also has a low quantitative impact on The license explicitly bars the payment of any tax-
exports due to the low volumes lifted by the companies. es or royalties to the Government of Venezuela or the
However, it did serve as a signal that the U.S. govern- payment of dividends to any entity owned by PDVSA.
ment was willing to reevaluate its previously stringent The US Treasury Department published a press state-
stance on the role of foreign oil companies in Venezu- ment claiming that the authorization “prevents PDV-
ela. SA from receiving profits from the oil sales by Chev-
The Biden administration’s reevaluation of restric- ron.”163 A Biden administration official also told the
tions on the operation of U.S. oil companies in Vene- New York Times that instead of going to pay taxes and
zuela has significantly more potential to impact Vene- royalties, profits earned would go to the repayment of
zuelan macroeconomic conditions. While there have government debt to Chevron.164

These statements are misleading and improperly 2023, Chevron CEO Michael Wirth said that the
characterize of consequences for Venezuelan fiscal accompany could raise its production 50% during 2023
counts of the granting of the license. Chevron does not to 150 tbd without significant new investments.167
pay income taxes or royalties to the Venezuelan govern- Venezuela resumed oil exports to the U.S. in January
ment because it produces no oil in Venezuela. It is the with an average 72.5 tbd (valued at USD 140 mn) in
joint ventures in which Chevron is a minority partner shipments. However, these amounts have progressively
that produce the oil and pay taxes and royalties to the grown over the next 3 months and had reached 143.4
Venezuelan government and dividends to PDVSA. tbd (USD 281 mn) in April.168
Each barrel of oil produced in Venezuela by oil-pro- The licensing change also enabled the import of
ducing companies, in this case the joint ventures, must petroleum products essential to the processing of Ven-
pay a 50% income tax and between 20 and 33% in roy- ezuela crude from the U.S. In 2018, before the imposi-
alties under Venezuela’s hydrocarbons law. tion of U.S. oil sanctions, Venezuela imported an aver-
As Chevron began to sell Venezuelan oil in the age 125 tbd in oil products from the U.S., per Energy
U.S. in 2023, the mechanism to provide resources to Information Administration (EIA) data, which fell to
the Venezuelan government became clearer. In prac- virtually zero after sanctions. The licensing changes
tice, Chevron purchases the oil, sells it in the U.S., and have resulted in a rise in these imports to 15 tbd for
sells the dollars obtained from those sales in the local the period between December 2022 and February
exchange market for local currency. These local curren- 2023 (the latest available data at the time of writing).
cy amounts are then delivered to the Venezuelan gov- Higher imports of high-quality U.S. oil products will
ernment to settle the company’s fiscal contributions allow Venezuela to expand output and address quality
and to cover operating expenses of their companies in problems.
Venezuela. This mechanism is essentially equivalent to All-in-all, the loosening of restrictions on Chevron’s
the regular scheme that would operate in the absence activities in Venezuela is likely to result in an increase
of sanctions in which the oil from joint ventures would in the countries oil output. However, the true reach of
be sold directly or through PDVSA and the USD pro- this expansion is yet to be fully seen, as rehabilitating
ceeds would be delivered to the Central Bank, which the company’s operations will require investment.
sells them in the exchange market. Venezuelans would While the current loosening of sanctions was im-
have been able to buy dollars at a lower rate than they plemented through an OFAC license, other possibil-
would receive if these revenues did not exist. Through ities have been considered and may be reevaluated in
exchange rate intervention, the government would the future. For instance, prior to the issuance of GL 41,
channel the dollars into the economy.165 discussion on modalities for the easing of restrictions
The full impact of GL 41 on Venezuelan oil produc- on Chevron revolved around a reduction of PDVSA’s
tion is yet to be seen. Since December, Venezuela’s oil shareholder participation in their joint ventures below
production has risen 10% to 724 tbd in April, a level 50%. Under the current sanctions framework, the pro-
unseen since February 2020 (760 tbd).166 In April hibition of dealing with the government of Venezuela

OFAC LICENSING AND PARTIAL AGREEMENTS
extends to any entity in which it has an ownership in- allowed by OFAC, but the U.S. government did not ob-
terest of at least 50%.169 This means that sanctions will ject until October 2020 when it pressed participating
no longer apply to any given joint venture if Venezuela companies to suspend it.175 Diesel is crucial for power
decreases its ownership interest below this threshold. generation, food distribution, and public transport, all
One precedent for this mechanism can be found in of which have profound humanitarian implications.176
the resumption of methanol exports by JV Metanol de Recent media reports indicate that the Maduro ad-
Oriente (Metor) in 2021.170 Pequiven, a fully owned ministration would favor a resumption of product
subsidiary of PDVSA, owns a 37.5% stake in the JV, swaps over alternative oil-for-debt arrangements and
but foreign partners own the rest, which means that the topic was publicly discussed extensively during a
Metor itself isn’t a sanctioned entity.171 period of particularly-acute diesel shortages in 2021.177
The largest obstacle to the implementation of a In some sense, the resumption of these arrangements
similar scheme to crude oil exports is that the current is a low-hanging fruit for humanitarian-oriented initia-
Venezuelan Organic Hydrocarbons Law requires joint tives relating to Venezuela, as it’s one of the proposed
ventures operating in the upstream sector to have a min- mechanisms that has the most immediate positive
imum of 50% ownership by the Venezuelan state.172 impact on the population while leaving the least space
Furthermore, the law also reserves the marketing of oil for corruption and associated slippage. One potential
to companies fully owned by the state.173 Over the last objection to the scheme would be PDVSA’s practice of
few years, proposals from both government and oppo- exporting diesel to Cuba, which undermines the initia-
sition-affiliated legislators have contemplated abolish- tive insofar as it seeks to alleviate the Venezuela crisis,
ing these restrictions, but the law hasn’t been amended. but this could be prevented by explicitly conditioning
Oliveros (2020) also suggested a form of oil-for- the approval of the arrangement to PDVSA not re-ex-
debt swaps, under which Venezuela would deliver oil porting the acquired products.
barrels to repay the debt owed to key creditors, such as Press reports indicate that Venezuela exported 80
Crystallex or bondholders. As noted above, we believe tbd to Cuba in 2022 and 55 tbd the first four months
that this mechanism would have little to no effect on of 2023.178 These exports have been the subject of some
humanitarian variables in the short term, although it political controversy, as they are perceived as an unwar-
could improve Venezuela’s standing in an eventual re- ranted “gift” to the country that persists even in the
structuring of debt by decreasing its stock and helping context of the humanitarian crisis. However, there is
to decrease the threat to existing foreign assets, includ- some evidence that indicates that continued exports to
ing CITGO. We elaborate on this topic in Chapter 5. Cuba are a way in which the Venezuelan government
Another related option is oil-for-products swaps. skirts oil sanctions. U.S. firms are barred from doing
Since the January 2019 sanctions, the U.S. government business with the Venezuelan government or its com-
had allowed Repsol, Eni, and Indian oil company Re- panies, which have a monopoly on the country’s oil
liance to conduct diesel swaps with PDVSA.174 The exports. The sanctions regime also allows the U.S. gov-
practice was not formal, in the sense of being explicitly ernment to impose sanctions on any persons who “ma-

terially assist” the Venezuelan government, a provision ternative would be for OFAC to permit U.S. compa-
that is inexistent in the traditional Cuban sanctions re- nies to conduct diluent swaps with PDVSA. Diluents,
gime.179 In 2019, the U.S. government began targeting such as light crude grades and certain refined products
Cuba with secondary sanctions for its involvement in such as Nafta and condensates, are crucial for upgrad-
helping Venezuela evade export restrictions. However, ing some of Venezuela’s heavier oils into marketable
it is likely that this intermediation remained legally saf- grades and the country’s output has at times been ham-
er for potential buyers than direct purchases from Ven- pered by their lack.180 Since the prohibition of oil trade
ezuela, as secondary sanctions carry a lower risk than with U.S. companies, PDVSA has resorted to import-
primary sanctions. An additional factor in the use of ing diluents from Iran, which has had a positive impact
this mechanism may be that it is a venue to shield the on its production, but these imports have been plagued
exports from potential seizing by creditors. with low-quality issues, resulting in an accumulation of
Another variation of the oil-for-products swap al- reserves in shipping tankers.181
Comparison of Different Oil-for-Essentials Initiatives
Broadly speaking, existing oil-for-essential initiatives to economic activity and, consequently, formulated a
can be grouped into two types, those that advocate for more comprehensive and ambitious proposal to allow
a broad-based licensing arrangement flexible enough the recovery of the oil industry while maintaining re-
to accommodate different participants, and those that strictions on the Maduro government and ensuring the
target only exceptional, specific, deals. In the former humanitarian use of funds. This difference is reflected
category, Oil for Venezuela’s proposal has the broadest both in the explicit language in each study and in its
scope and potential for reach. On the other end, assumptions about the potential recovery of oil output.
OFAC licensing agreements for individual foreign Another crucial difference is in the design of pro-
companies to perform oil-for-debt swaps with PDVSA gram governance. Currently discussed specific licensing
are the most modest alternative. Other proposals fall arrangements are governed directly by the U.S. State
somewhere in between. Department through OFAC, whereas broad-scope hu-
There is also a question of the short vs. long-term manitarian initiatives generally seek to create an instance
nature of each. The Boston Group and Atlantic Coun- in which the Maduro government and the opposition
cil proposals are conceived as short-term transitory can reach a consensus and govern the programs jointly.
alternatives targeting a relatively limited increase in oil To a great degree, this difference is intentional, as propos-
production. In contrast, the Oil for Venezuela’s Hu- als based on OFAC licensing explicitly reject attending
manitarian Oil Agreement recognized the possibility long-term structural problems arising from the econom-
that the conflict would remain a long-term obstacle ic crisis or the broader political divide in the country.

Table 12: Comparison of different Oil-for-Essentials proposals
Specific licen-
UN OFFP for Atlantic
sing arrange- Oil for Venezuela Boston Group
Iraq Council
ments
Consultive Board
Administrative Board with a balanced
with a balanced representation
Governing UN Security US State US State representation of the of the Maduro
body Council Department Department Maduro and Guaidó and Guaidó
administrations and administrations
UNSC designees and Boston Group
members
Technical Sales
Management Private joint Private joint
Iraq’s executive Committee Private joint venture
of program venture venture
branch designated by the partners
sales partners partners
Administrative Board
UN and Advisory Board
Management Iraq’s executive US State Consultive Board
US State designated by
of proceeds branch Department and UN
Department Administrative Board
Distribution
Mix of private
of Humanitarian Mix of private and Humanitarian
and public n/a
humanitarian initiatives public distribution initiatives
distribution
goods
Sanctions
Committee
constituted by US State US State Consultive Board
Surveillance Administrative Board
all members Department Department and UN
of the Security
Council
Humanitarian
goods and Oil-for-debt, Humanitarian goods
Humanitarian
Scope investments oil-for-products and investments in Humanitarian goods
goods
in oil swaps. public infrastructure
infrastructure
180 days,
Authorization 180 days, renewable 365 days, renewable
renewable upon Not specified Not specified
periodicity upon periodic review on agreement
periodic review
670-2,087 tbd
Potential (actual
Not specified 150-350 tbd 400 tbd 67-117 tbd
impact (tbd) amounts, varied
by phase)
Potential USD 7.8-33.2 bn

impact per (actual
Not specified USD 3.8-8.8 bn USD 10.5 bn USD 1.7-2.9 bn
year (current amounts, varied
USD) by phase)

Recommendations
The different proposals presented in this chapter of its future failures.

have many points in common, but also display There is also a long-term dimension to pro-
significant differences in terms of the philosophy gram design. While the proximate cause of the
inspiring them. This is reflected in the difference Venezuelan collapse lies clearly in the oil and ex-
in ambitions and program scales, as well as in the ternal sectors, these are fundamentally the result
level of program ownership suggested by each or- of the degeneration of Venezuelan politics into
ganization. a polarized winner-takes-all struggle. Initiatives
As we showed in Chapter 1, there is over- that foresee greater participation by national
whelming evidence that Venezuela’s humanitari- stakeholders aim at transforming this conflict
an catastrophe is driven by the collapse of its oil into a positive-sum interaction. As Acemoglu
exports, which have fallen by more than 70 per- and Robinson (2019) argue, historical experi-
cent in the last eight years. Addressing the crisis ence shows that when external actors try to build
to any satisfactory degree is difficult (or, perhaps, state institutions from the top down without the
impossible) without reinserting Venezuela into participation of local actors, key stakeholders in
the global economy by restoring its access to oil society will either withdraw or rebel and these
and financial markets. Only broad, flexible and arrangements will prove ultimately fragile and
ambitious programs can help the country to gen- vulnerable.
erate revenues of sufficient size to make a signifi- All proposals in this discussion recognize that
cant impact on the humanitarian crisis. the international community should help rebuild
Smaller and more limited programs can serve the economy’s capacity to generate hard currency
as a first step to help build confidence for a more revenue and to channel it into imports of goods and
complex design and can also provide insights services essential for the life of Venezuelans. How-
into design strengths and shortcomings. How- ever, they differ in how they place these objectives
ever, a program that is designed to omit the in- in the larger scheme of Venezuelan reinstitutional-
herent complexities of the necessary large-scale ization. Limited-scale proposals seek to offload re-
program could end up locking in an institutional sponsibilities to international partners, while larg-
structure that is not well designed to tackle these er-scale ones seek to foster the development of local
issues, and that this will either constrain the institutions capable of managing political conflict.
growth of the program or cause it to expand be- There is also an additional weakness arising
yond what it is designed to do, sowing the seeds from conditioning humanitarian initiatives to a

negotiated solution to the Venezuelan political tion of the Venezuela democratic forces or used
crisis. As it is currently being formulated, OFAC for pre-agreed oil-for-products swaps.
licensing for U.S. companies to expand their role Russia’s souring relationships with the West-
in the Venezuelan oil industry is conditional on ern world and the changing institutional land-
progress in Mexico negotiations between the scape in Venezuela also present potential prob-
Maduro government and the Venezuelan oppo- lems that may require modifying the first Oil for
sition. It presupposes that the 2024 presidential Venezuela program design. While it is possible
elections will put an end to the conflict, allow- that Russia would not object to the scheme with-
ing a full regularization of international relations in the security council, and may even support it
with the country. However, there is a distinct actively, a humanitarian initiative seeking to alle-
possibility that the electoral event does not re- viate the Venezuelan crisis should not be allowed
sult in a satisfactory outcome from the point of to be made hostage to international geopolitics
view of the U.S. government and the Venezuelan and commercial interests of any foreign partner.
opposition. This contingency requires a deep For these reasons, we recommend deempha-
evaluation of the role of sanctions in humani- sizing the potential role of the UNSC and work-
tarian outcomes in the country. Put in simpler ing on fostering technical and political dialogue
terms, the U.S. government must evaluate wheth- instances that allow the Maduro government and
er sanctions should be maintained indefinitely the Venezuelan opposition, broadly defined, to
without implementing some sort of mechanism directly negotiate a humanitarian program. Neu-
to alleviate their consequences. tral countries and multilateral organizations can and
A broad-scoped multilateral mechanism that should still be incorporated in the oversight design
provides an instance for cooperation among by requesting them to nominate members to the
the disputing parties could provide a channel Administrative Board tasked with mediating and re-
to ease these impacts without abandoning the solving conflicts within the instance.
aim of holding internationally recognized elec- Another potential avenue for mutually beneficial
tions in Venezuela. If designed in a sufficiently arrangements can be found in legislative initiatives
flexible manner, it can also accommodate differ- to modify oil sector regulations. There is widespread
ent modalities, for instance by permitting joint agreement that the private sector should be allowed
venture partners to market oil produced under to have a significantly larger role in the industry in
the program directly while also creating techni- Venezuela and that allowing it to do so may play a
cal boards tasked with marketing expanded pro- key role in accessing the funds required to recover
duction in fields operated by PDVSA alone. In its oil production to pre-2017 levels. Achieving this,
either case, we recommend that proceeds be de- however, requires an agreement on which legislative
posited to escrow accounts administered jointly instances have the legitimacy to amend the Organic
by the Maduro administration and a representa- Hydrocarbons Law, and the parties in the conflict

should be encouraged to negotiate the required
changes in a way that enables higher participation by
foreign partners as shareholders in Joint Ventures.
Regardless of the specific mechanisms chosen to
implement our humanitarian initiative, we believe
that a program should put humanitarian consider-
ations at the heart of design and skew the tempta-
tion to use them as a bargaining chip for elector-
al negotiations that foster an adversarial attitude
among the parties. Instead, the program should aim
to foster trust in the commitment of the parties to
coexist within the country by putting the necessi-
ties of its population at the forefront.

Endnotes
122
There is significant uncertainty over the true extent of discounts applied to Venezuelan oil by buyers. Over
the past 12 months, OPEC has reported the price of the Merey crude, an extra-heavy blend originating from
eastern Venezuela, at a USD 22.4/bbl discount to the Brent marker. However, according to Parraga (2022c),
customers demanded discounts to Brent as high as USD 47/bbl by June 2022, up from USD 35-38/bbl earlier
in the year. The report attributed part of this additional discount to PDVSA demanding prepayment before
loading. We take the price reported by OPEC for our calculations, since there is little certainty of the extent to
which the discounts reported by Reuters are applied to Venezuela’s oil exports.
Unless otherwise indicated, we employ OPEC’s Secondary Sources data as a reference for Venezuela’s oil
123
production.
124
Executive Order 13808 (2017).
This date marks the day on which the contractual grace periods on the company’s earliest missed Eurobond
125
coupons elapsed. In the following months, PDVSA defaulted on all its other bonds, except the senior secured
PDVSA 8.5% 2020, which has a first lien on Venezuela’s most valuable external asset, US refiner CITGO. See
ISDA Determinations Committee Decision (2017) for details on the dating of the default.
126
Hausmann and Muci (2019), Bahar et al. (2019).
127
EIA (2018).
128
U.S. Department of the Treasury (n.d.d).
129
U.S. Department of the Treasury (2020).
If we choose to use the production levels of August 2017, when the U.S. imposed financial sanctions on Ven-
130
ezuela, as our baseline, the resulting decline would be 785-852 tbd.

131
General License No. 41 (2022).
132
Zerpa and Laya (2023).
133
Parraga (2022c).
134
The discount on Merey has fluctuated significantly over the last decade. It was USD 12/bbl (or 11% in rela-
tive terms) in 2012-14 and USD 9/bbl (19%) in 2015-17. The discount was at a low USD 7/bbl (10%) in 2018
but rose to USD 10/bbl (16%) in 2019, USD 14/bbl (33%) in 2020, USD 19/bbl (27%) in 2021, USD 23/bbl
(23%) in 2022, and USD 21/bbl (25%) so far in 2023. See OPEC Annual Report (2012, 2013, 2014, 2015,
2016, 2017, 2018, 2019, 2020, 2021, 2022).
135
U. S. Department of State (n.d).
136
HFW (2022).
137
This section draws heavily from our previous work for Oil for Venezuela (2019).
138
Katzman and Blanchard (2005).
139
UNSC Resolution 1153.
140

141
142
143
Those that can have both civilian and military applications.
144
Volcker Report (2005).
145
Duelfer Report (2004).
146
It is important to note that Gordon (2006) recognizes this design flaw but argues that it was a direct result
of political negotiations to make the Hussein government accept the program.
147
Oil for Venezuela (2019).
148
Pons and Armas (2018).
149
Atlantic Council (2022a).
150
Rodríguez (2022b).
151
Gleave (2022).
152
Parraga and Spetalnick (2022).
153
Eni (2022).
154
Repsol (2022).
By the end of 2022, the companies had recovered USD 41 mn and USD 18 mn from these debts through the
155
new oil-for-debt swap mechanism.

156
TankerTranckers.com (2023)
157
Parraga (2022d).
158
Parraga (2022e).
No shipments to Europe in December or January, then 22.3 tbd in February, zero in March and 33.3 tbd in
159
April.
160
Sequera, Spetalnick, and Parraga (2022).
161
Zerpa (2022).
162
General License No. 41 (2022).
163
U.S. Department of the Treasury (2022b).
164
Turkewitz and Kanno-Youngs (2022).
165
Rojas (2023).
166
OPEC (2023).
167
Valle and Parraga (2023)
168
TankerTranckers.com (2023).
169
170
Parraga and Buitrago (2021).
171
Garip (2020).
172
La Asamblea Nacional de Venezuela (2006)

173
Ley Orgánica de Hidrocarburos (2006).
174
Garip (2021).
175
Arredondo and Ocando (2021).
176
WOLA (2020).
177
Cohen (2021).
178
Parraga (2023b)
179
Executive Order 13857 (2019) and Executive Order 13808 (2017).
180
Parraga and Guanipa (2021a).
181
Parraga and Guanipa (2021a).

Chapter 4
Accessing Multilateral Cooperation
and Blocked Funds
Venezuela has suffered a devastating eco- painless or straightforward, which is why

nomic and humanitarian crisis for almost a most countries in this situation seek support
decade. The country has also been in default from multilateral institutions that provide
on most of its external debt for almost six financial backing to smooth the transition
years. Normally, a country in this situation and technical cooperation to design policies
would attempt to undertake a comprehensive that are sustainable while providing suffi-
economic overhaul to address the structural cient safety nets to protect the population
issues generating the crisis. Generally, that from deprivation.
would require a politically and economical- As in many other respects, Venezuela’s ex-
ly costly fiscal and external adjustment and perience is unlike others in this regard. De-
would entail a restructuring of public debt to spite the prolonged crisis, the country has
provide breathing room for economic growth not embarked on a debt restructuring , im-
to resume and, eventually, regain access to plemented a comprehensive macroeconomic
international financial markets to fund gov- adjustment program, or obtained the assis-
ernment spending. The adjustment is seldom tance of international financial institutions.
ACCESSING MULTILATERAL COOPERATION AND BLOCKED FUNDS 113

ACCESING MULTILATERAL COOPERATION AND BLOCKED FUNDS
As we showed in Chapter 1, the Maduro ad- institutions, such as the central bank and
ministration was forced by a lack of revenues PDVSA abroad, that would enable access
and financing to undertake the implementa- to their resources by dissipating uncertain-
tion of most of the most painful aspects en- ty over their legal capacity to use them. The
tailed by an adjustment program – including agreement to appoint these instances must
deep import cuts, currency devaluation and be born out of a political negotiation that es-
a decline in real government spending – but tablishes ex-ante clearly designed planning ,
without any of the benefits associated with implementation and oversight mechanisms
multilateral support. These adjustments have to govern the disbursement of funds, the
come without the ability to provide suffi- procurement of humanitarian supplies and
cient safety nets, smooth consumption or in- distribution of benefits. These mechanisms
vest in key infrastructure to enable sustained must incorporate oversight and technical co-
growth. The lack of multilateral support operation capabilities of international insti-
has only been compounded by the inability tutions at the center of their design. State
to employ existing external assets, valued in and municipal governments can play an im-
the billions, to attend to some of the popula- portant role in this oversight mechanism as
tion’s most urgent needs. well as in the assessment of needs to be pri-
The most crucial impediment to Vene- oritized in the use of funds.
zuela’s ability to restructure its debt, access In this chapter, we review the origin and
its financial holdings and seek multilateral effects of the legitimacy crisis and survey po-
assistance derives from its unique situation tential cooperative mechanisms that would
in terms of international recognition. To a enable the country to access its existing ex-
large degree, this stems from the fact that the ternal assets, as well as multilateral support,
government with de facto control over its ter- to address some of the country’s most ur-
ritory, and thus the authority to implement gent needs in a transparent, equitable and
policy in it, does not control the legal rep- non-partisan way. While the agenda for a
resentation of the state before a large part of comprehensive, traditional stabilization pro-
the world economy. gram is beyond the scope of this work, we be-
As in our discussion of oil-for-essentials lieve there is significant room for agreements
initiatives in the previous chapter, the trans- to alleviate the urgent humanitarian crisis
parency in the management of resources that and invest in the country’s infrastructure,
comes out of accessing multilateral coopera- even without a full resolution of the underly-
tion and blocked funds is key. Existing pro- ing political dispute.
posals stress the possibility of creating con-
sensus governing instances to represent key

The Venezuelan Legitimacy Crisis
and the Control of Assets
As we explained in the introductory chapters, the arguing that the Venezuelan government did not
Venezuelan crisis escalated significantly with the count with legally appointed representatives be-
constitutional convention elections of 2017 and fore the regulatory bodies of those countries. It
the presidential elections of 2018. Neither event also separately requested that entities in the private
was recognized by the opposition and a large part of banking sectors of these countries also prohibit any
the international community as legitimate or valid. management of assets of the Venezuelan state.
As a result of this non-recognition of the electoral On January 23, Juan Guaidó claimed the com-
events, opposition-aligned lawyers in the country petencies of the executive under the position of
developed the theory that a “power vacuum” had interim president of Venezuela, receiving recogni-
emerged which had to be filled by existing legitima- tion by the U.S. and 56 other countries, but not
te institutions. by China, Russia, and Iran. The U.S. State Depart-
On January 10, 2019, Nicolás Maduro was ment followed up on the executive’s recognition
sworn in for a second presidential term, taking the by transferring control of the Venezuelan govern-
oath of office before the nation’s supreme court ment’s bank accounts to the Guaidó administra-
instead of the conventional Congressional venue. tion. This transfer was given effect by certification
However, shortly after the swearing-in ceremony, by the Secretary of State but was also confirmed
the 2015AN board of directors issued a statement by courts.184 This control extends to fixed assets lo-
saying that there was no legitimate president in cated in the U.S. belonging to the Venezuelan state
Venezuela.182 or Venezuelan state-owned enterprises, including
Five days later, the 2015AN approved four res- PDVSA and CITGO, of which the Guaidó ad-
olutions aiming to formalize its non-recognition ministration took possession by designating gov-
of the presidency of Nicolás Maduro and to use erning boards – boards whose authority was later
its constitutional prerogatives to address the coun- validated by US courts.185
try’s economic and political crisis. Among these, Besides the general dilemma regarding the recogni-
we highlight two resolutions. The first authorized tion of either competing claim to the presidency, there
humanitarian aid to address the country’s social cri- was also the overlapping question of the nature of such
sis, a decision which, as we discussed in Chapter 2, recognition. While 57 countries recognized Guaidó
played a role in the weaponization of humanitarian as of the end of 2020, only 15 accorded it full recogni-
aid.183 The second requested the freezing of funds tion both in de jure and de facto terms, a number which
and assets of the Venezuelan state to 46 countries, had fallen to 6 by the end of 2022.186

THE VENEZUELAN LEGITIMACY CRISIS AND THE CONTROL OF ASSETS
The issue of recognition became even more The inclusion of the state-owned oil company
intricate in 2020 when Venezuela held legislative PDVSA in the list of Specially Designated
elections that were boycotted by the mainstream Nationals maintained by the Treasury
opposition, resulting in the election of a new Department’s Office of Foreign Assets Control
National Assembly with pro-government parties further accentuated the economic effects of
having an overwhelming majority. Mainstream these decisions on Venezuela’s external revenues.
opposition parties regarded the event as illegiti- It is worth noting that as a consequence of this
mate and extended the mandate of the 2015AN. designation, even interim government appointees
This added another layer of uncertainty over the were unable to conduct financial transactions
legal representation of Venezuelan institutions, on behalf of PDVSA without an OFAC-issued
as Guaidó’s mandate as interim president was license.
derived from his position as the president of the Some international financial institutions,
assembly. including most prominently the IMF and the
In the following years, the U.S. government World Bank, decided to engage neither of the
continued to recognize Juan Guaidó as president two governments (i.e., those led by Guaidó and
of Venezuela. U.S. jurisprudence establishes the Maduro), resulting in the de facto freezing of Ven-
principle of deference to the executive branch in ezuela’s access to financing, including emergency
matters of recognition of governments. This im- funding lines used by many countries during the
plied that the decision of recognition had con- COVID pandemic.
crete economic effects of transferring the man- Finally, in December 2022, the 2015AN
agement of Venezuelan assets held in the U.S. to dissolved the interim government, leaving
representatives of Juan Guaidó. State Secretary countries that formerly recognized Guaidó as
Mike Pompeo instructed financial institutions to the president of Venezuela in a complicated
transfer the accounts of Venezuela’s government position regarding the way to give continuance
and Central Bank to Guaidó representatives in to their policy or step-back a reevaluate. So far,
January 2019.187 U.S. courts then affirmed the four countries – the U.S., Canada, Paraguay
authority of Guaidó representatives over the and Guatemala – have chosen to continue
management of Venezuelan assets.188 dealing with the 2015AN, on the argument
Competing claims over the Venezuelan pres- that it is the sole legitimately-elected branch
idency extended into competing claims at other of power in the country. However, Paraguayan
institutional levels, including the Central Bank President-elect Santiago Peña has publicly said
of Venezuela’s governing board and other state- he plans to normalize relations with the Maduro
owned or controlled organisms that claim con- government; thus, this number will be further
trol over the foreign assets of several Venezuelan reduced to 3 after his investiture on August 15,
state-owned enterprises, including PDVSA. 2023.

The Road Ahead
Formally, there were dual claims to Venezuela’s presidency between January 2019 and December
2022, when the 2015AN officially dissolved the interim government formerly headed by Juan
Guaidó. As part of the reform of the transition statute, the 2015AN created an Asset Management
Board to oversee Venezuela’s external assets, which we more thoroughly discuss in Chapter 5. For the
purposes of the discussion in this chapter, it’s enough to keep in mind that the subject remains in a
gray area and the control of Venezuelan external assets is likely to remain contentious at least for the
time being.
It is also important to note that, while the status of Venezuelan external assets and who controls
them has yet to be fully resolved, it is unlikely that the recognition issue will be fully settled in the
near term. We thus expect that the U.S. government, as well as possibly other nations in which
Venezuelan state assets are located, will at the very least continue to withhold recognition of the
Maduro government in the near future. This means that, despite the formal end of dual claims to
the presidency, Venezuela will remain barred from access to a significant share of its external assets
for the time being.
Fund for the Social Protection of the People of Venezuela
In November 2022, the opposition and govern- actual implementation details were left open
ment announced that they had agreed to terms for further negotiation.190
for the creation of a humanitarian fund fed by Months after the agreement, there is no con-
existing frozen assets and to be managed by the crete news on when and how the fund will be
UN for the benefit of the Venezuelan popula- implemented. Press reports indicated that the
tion. Statements by members of both sides indi- delay was the result of the Venezuelan opposi-
cate that the fund will be stocked with USD 3 tion and the U.S. government weighing options
bn.189 While the announcement is undoubtedly on how to mobilize the funds without expos-
a step in the right direction, the actual imple- ing them to creditor attempts at attachment.191
mentation of the agreement has fallen short of Chief opposition negotiator Gerardo Blyde said
the promise. Over time it became clear that the that the funds were dispersed in several jurisdic-
fund was only agreed upon in principle and the tions, each of which posed particular challeng-

es that required individual treatment. Maduro social fund […] cannot be opened because, the
administration representatives have repeatedly U.S. and the creditors will chase the funds.” 193
stated that they would not resume the Mexico On May 18, 2023, Bloomberg reported that the
City negotiations until the funds are released. 192 U.S. government had finally provided the UN
At issue appears to be a communication by with formal assurances that the funds would be
the Biden administration warning the UN that protected from creditors.194 The news agency
it could not ensure the funds’ safety from cred- also reported that the fund could begin opera-
itor attachment. In this regard, the president of tions within the month. As of the time of this
the 2020AN, Jorge Rodríguez, stated that then- writing, there have been no subsequent devel-
U.S. Ambassador to Venezuela James Story had opments indicating progress in the creation or
“sent a letter to UN authorities saying that the funding of the initiative.
The Fund for the Afghan People
Afghanistan’s recent experience has the poten- International sanctions and various other
tial to shed light on many aspects of the Vene- restrictions on the Taliban have a long histo-
zuelan situation and provide a possible model ry. When the group took over Afghanistan
to deal with its complications. These include for the first time in 1996, only three countries
the operation of international relations with a (Saudi Arabia, Pakistan, and the United Arab
country for which there is no recognized go- Emirates) recognized it as a legitimate govern-
vernment and how to deploy its assets for the ment. 195 Formal sanctions came in 1999, as the
benefit of its population in the absence of re- U.S. government blocked transactions with the
cognition of the government that holds de Taliban and associated groups through U.S. Ex-
facto control of the territory. It also presents ecutive Order 13129 of July 1999, 196 followed
an example of an alternative legal and institu- by UN Security Council economic sanctions 3
tional design for a humanitarian program. In months later. 197
the following pages, we review the legitimacy Between 1996 and the 2001 war, the U.S.
void created by the Taliban’s takeover of Af- and most western allies recognized no gov-
ghanistan and analyze the novel mechanism ernment in Afghanistan and the Taliban were
designed and implemented by the U.S. gover- unable to assume control of U.S.-based assets,
nment, alongside international partners and including the central bank’s international re-
Afghan citizens, to address the country’s hu- serves. 198 Despite the lack of recognition of
manitarian crisis. any government, the pre-1996 Burhanuddin

THE FUND FOR THE AFGHAN PEOPLE
Rabbani administration retained Afghanistan’s lected international institutions (including the

seat at the UN Security Council, as the UN UN and its specialized agencies). 205
credentials committee repeatedly deferred a On September 14, 2022, the U.S. govern-
decision on recognition, thus tacitly allowing ment announced the creation of the Fund for
the last accredited representative to remain in the Afghan People in order to support macro-
the council. economic and financial stability. 206 Among its
The establishment of a transitional govern- explicit functions are i) providing liquidity to
ment after the U.S. invasion enabled a regular- the banking sector, ii) servicing Afghanistan
ization of the country’s international standing, debt service obligations, iii) supporting ex-
but this stability proved only temporary. In change rate stability, iv) paying for critical im-
April 2021, the North Atlantic Treaty Organi- ports (such as electricity), v) paying for critical
zation (NATO) announced the withdrawal of services required for the operation of a central
its military presence in Afghanistan. 199 Soon bank and vi) transferring funds to appropriate
after the announcement, the Taliban began a public sector institutions. 207
military offensive to topple the western-aligned The list of stated functions indicates that
government of Ashraf Ghani and take over the the Fund’s primary objective is to assume the
country. The U.S. military withdrawal was ex- role of the central bank and to allow for central
tended until August, soon after which Taliban bank operations to be carried out that would
forces took the capital city of Kabul. 200 otherwise be blocked due to the non-recogni-
After taking control of the capital, existent tion of authorities appointed by the Taliban.
sanctions on the Taliban and other terrorist It also appears that the creation of a Switzer-
organizations, described in Executive Order land-based trust is at least to some degree mo-
13224 of September 2001, meant that U.S. per- tivated by a desire to shield part of the funds
sons became banned from transacting with the from attempts to seize them through U.S. liti-
Afghan government. 201 The Taliban also ap- gation initiated by victims of terrorism. 208
pointed new central bank authorities, 202 several The U.S. government transferred USD 3.5
of which are subject to personal U.S. sanctions, bn of the USD 7.0 bn frozen Afghan central
and the bank lost access to its accounts at fi- bank international reserves to the Fund (the re-
nancial institutions around the world. The U.S. mainder will remain in blocked Afghan central
government then explicitly froze over USD 7 bn bank accounts in the U.S., potentially to pay
in international reserves held by U.S. financial awards to the benefit of terrorism victims). 209
institutions through Executive Order 14064 of International reserves frozen by countries oth-
February 2022. 203 OFAC issued several licenses er than the U.S., estimated at USD 2.1 bn, 210
providing exceptions for humanitarian assis- could also be transferred to the institution, but
tance and certain limited 204 operations by se- haven’t yet been as of this writing.

The Fund for the Afghan People is incor- ies. In late November, the governing board
porated as a Swiss foundation under the con- convened in Geneva for the first time. 216 The
trol of a Board of Trustees and maintains an board decided on i) a principle of initial Af-
account with the Bank for International Settle- ghan co-chairmanship; ii) establishing an ad-
ments (BIS), an organization that provides fi- visory committee; iii) investing existing funds
nancial services to central banks and other na- to protect the value of its assets; iv) initiating a
tional and international monetary institutions. recruitment process for an executive secretary;
The board of trustees was initially composed v) hiring an external auditor to conduct annual
of “[…] two highly qualified Afghan econom- audits and; vi) developing compliance controls
ic experts with relevant macroeconomic and and foundational corporate governance docu-
monetary policy experience, a U.S. government ments. 217
representative, and a Swiss government repre- The legal basis for the decision is ground-
sentative,” but latter an additional member was ed on U.S. Executive Order 14064 (described
designated, and U.S. government representa- above) and Section 25B of the Federal Reserve
tive was replaced. 211 The board takes disburse- Act, which regulates the certification of indi-
ment decisions by consensus. 212 viduals as authorized to manage foreign state
The two Afghan members of the board are assets deposited with the Federal Reserve. 218
Anwar-ul Haq Ahady and Shah Mehrabi, both The initial press release announcing the fund
of whom had served as central bank directors at notes that “[…] the Department of State certi-
some point before the Taliban takeover. Ahady fied two individuals pursuant to Section 25B
presided over the seven-member central bank of the Federal Reserve Act as having joint au-
governing board (Supreme Council) as gover- thority to receive, control, or dispose of prop-
nor between 2002 and 2004. 213 Mehrabi was erty from the DAB’s account. Those individu-
first appointed to the institution’s governing als founded the Afghan Fund as a legal entity
board in 2002 and remains a member despite in Switzerland.”
the Taliban takeover. 214 The three non-Afghan The Taliban has consistently criticized the
members are Alexandra Baumann, a public ser- U.S. freezing of Afghani central bank assets
vant at the Swiss foreign ministry, Jay Sham- and deemed their transfer to the fund as ille-
baugh, undersecretary for international affairs gal. In February 2022, the Taliban central bank
at the U.S. Department of the Treasury, and protested the decision to allocate half of the
Andrea Dall’Olio, an Italian economist who country’s frozen international reserves for hu-
worked for the World Bank as a lead country manitarian aid, stating that “the latest decision
economist for Afghanistan. 215 of USA on blocking FX (foreign exchange) re-
The Fund’s governing board can modify its serves and allocating them to irrelevant purpos-
bylaws and even designate subordinate bod- es, injustice to the people of Afghanistan.” 219

THE FUND FOR THE AFGHAN PEOPLE
In September, the Taliban Central Bank also the country, arguing that the U.S. should give
reacted to the fully-fledged proposal for the the Afghan central bank “a limited, monitored,
Fund for the Afghan People by calling it “unac- and conditional access to their own reserve.” 226
ceptable” and threatening individuals involved After the fund’s first meeting, he also stat-
with fines and other legal sanctions. 220 The ed that “For any purpose other than bringing
Taliban also said that they “oppose this itera- price stability and reducing volatility in the ex-
tion of the Afghan fund and will monitor [the] change rate, the board will consult the Taliban.
situation through diplomatic means” and – ac- Likewise, the Taliban can propose to us if they
cording to Graeme Smith, of the International would like to use the funds elsewhere,” implying
Crisis Group, as cited by journalist Spencer at least a willingness to make the mechanism
Ackerman – were denied a seat on the govern- cooperative to a degree. 227 It is also worth men-
ing board during the fund’s design phase. 221 tioning that the central bank’s official website
However, and despite these public rebukes, still shows Mehrabi as a member of its supreme
there is some evidence of prior negotiations council, despite being under the operative con-
and even some degree of reluctant consent trol of the Taliban. 228 He is also acknowledged
from the Taliban. In July, Reuters reported that as so in the official website of the Fund for the
the U.S. and Taliban officials had “exchanged Afghan People. 229
proposals” to release central bank reserves into The initiative is still in its early stages and
a trust fund but the idea was being stalled by thus there is only limited room to draw con-
U.S. objections to the appointment of a sanc- clusions on its design at this time. However, its
tioned individual to the central bank’s board formation as a trust in a neutral country offers
and Taliban objections to third-party control a potential template for a Venezuelan program.
of the trust. 222 Graeme Smith also believes that There are critics of the proposal beyond
Taliban protests over the creation of the fund the Taliban. Omar Joya –an academic, former
may be obligatory but the group reluctantly ac- official at Afghanistan’s central bank and for-
cepts the initiative. 223 mer World Bank economist– has argued that
It is also noteworthy that Mehrabi, who the mechanism would alleviate fiscal pressure
has been the most outspoken member of the on the Taliban without alleviating pressures
fund’s board of trustees, had long criticized on the population since the operations won’t
the freezing of Afghan central bank assets on create a local-currency liability corresponding
humanitarian grounds, 224 and has travelled to to the foreign currency disbursement for pay-
Afghanistan to meet Taliban authorities as a ments to foreign providers. 230 He further states
representative of the fund. 225 Since 2021, Meh- that the mechanism would allow the Taliban to
rabi had warned that the asset freeze would monetize its fiscal deficits, including by pay-
contribute to higher inflation and poverty in ing the salaries of its combatants. Joya suggests

that the mechanism incorporate the creation of six recommendations to maximize the fund’s
a local currency account at a reputable bank in chances of success: i) keep the governing board
Afghanistan and condition the disbursement small (especially given the requirement of
of foreign currency payments on the Taliban consensus for decision-making ); ii) lean but
depositing the equivalent sum into the ac- effective management; iii) instituting a trans-
count. He also suggests that the fund make its parent and well-documented decision-making
transactions transparent to the public by post- process; iv) instituting an expert advisory com-
ing them online. mittee; v) outside oversight beyond financial
William Byrd, an expert on Afghanistan at audits required by Swiss law and vi) operating
the United States Institute of Peace, outlined with maximum transparency. 231
Existing Liquid Funds in Offshore Bank Accounts
The exact amount of the resources earmarked mation. While some of the funds presented
for the humanitarian fund that the opposi- in this section are indisputably available – as
tion and the Maduro administration agreed demonstrated by official statements, court
to establish in November 2022 remains un- documents, or credible press reports – the
certain, as are the bank accounts and even the existence of other funds is less certain. We
countries in which the funds are held. Poli- provide indications of our level of certainty
ticians linked to the negotiation have given on each major amount and err towards being
imprecise figures of around USD 3 bn. 232 The conservative where we present amounts with
fund is likely intended to be capitalized by unclear existence or magnitude.
consolidating bank accounts held around the The Guaidó-designated BCV board reports
world. There is also significant evidence that USD 144 mn held in an account with the U.S.
funds currently frozen due to U.S. sanctions or Federal Reserve as its only reserve asset as of
otherwise immobilized by the legitimacy crisis the end of April 2023. 233 Other than that, there
affecting the country are sizeable, even if their are also three major components of the BCV’s
value is uncertain. In this section, we present international reserves that are certain to exist
an evaluation of their potential magnitude. but are not reported in this balance sheet: a
Offering a precise estimate of Venezuelan gold deposit held with the Bank of England,
government funds held abroad is an extremely the proceeds from a gold-swap operation and
difficult task given currently available infor- Venezuela’s Special Drawing Rights (SDR)

EXISTING LIQUID FUNDS IN OFFSHORE BANK ACCOUNTS
holdings at the IMF. nized Juan Guaidó as president of Venezuela.

The first consists of 32 tons of gold (val- The BCV board appointed by Nicolás
ued at USD 1,985 mn at the time of writing ) Maduro appealed this decision by reassert-
held by the Bank of England. The second cor- ing the de jure vs. de facto distinction. 237 The
responds to USD 122 mn in proceeds from appeals court sided with the Maduro board,
past BCV gold-swap operations with the finding that “it is perfectly possible for HMG
Deutsche Bank. 234 Ownership of the gold has to recognize one ruler or government de jure
been subject to a long and complicated legal and another de facto” and remitting the mat-
dispute between the Guaidó and Maduro ad- ter back to the commercial court to decide
ministrations in the courts of the UK. 235 on whether the statement presented by HMG
Court action began in May 2020. Both amounted to a recognition de jure or de fac-
administrations had appointed BCV boards, to. The distinction would be critical because,
which tried to access the funds in question. as the judge put it, “Where one ruler or gov-
The Maduro-appointed board argued that ernment is recognized de facto, English law
the English government continued to recog- is clear that the acts of a rival government
nize Nicolás Maduro as de facto president by (including its legislation) must be treated as
virtue of maintaining diplomatic relations a nullity, even if that rival government is rec-
with his government despite issuing a decla- ognized de jure.”
ration recognizing Guaidó as the legitimate The matter was then appealed to the Su-
de jure interim president. preme Court of the United Kingdom, which
In a first July 2020 decision on preliminary overruled the court of appeals decision in
issues, the High Court of Justice of England December 2021, finding that the prior HMG
and Wales found that i) the Her Majesty’s statement recognizing Guaidó as president
Government (HMG, henceforth) recognized was clear and definitive and there was no room
Guaidó as president and head of state (but for distinction between a de jure vs de facto
not as head of government) and ii) a deci- recognition in the case. 238 This conclusion
sion by the Venezuelan supreme court that was aided by an HMG intervention stating
relied on premises of the illegitimacy of Juan that there had been no ambiguity in past dec-
Guaidó’s claims to the presidency could not larations and that HMG recognized Guaidó,
be accepted by UK courts. 236 Importantly, the and Guaidó alone, as president of Venezuela.
judge also stated that HMG could not –as the However, the Supreme Court of the UK de-
Maduro-appointed board contended– recog- cided that the commercial court had to decide
nize separate de jure and de facto presidents judgments invalidating Guaidó’s appointing
for a single country. The decision was sup- of the BCV board issued by Venezuela’s su-
ported by a statement in which HMG recog- preme court “should be recognized or given

effect” in UK courts. 612 bn) among member countries according
In July 2022, the lower court dismissed the to their IMF quotas with the primary purpose
Maduro board’s attempt to get the Venezue- of helping finance pandemic-related increases
lan supreme court judgment invalidating the in spending. 243 However, since the IMF
recognition of Guaidó’s appointments, 239 but recognized neither Juan Guaidó nor Nicolás
also permitted it to appeal the decision. 240 Maduro as president — as we explain later
It is important to note that the Supreme in the chapter — the funds haven’t been
Court of the UK found that “HMG has since available to either administration.
4 February 2019 recognized Mr. Guaidó as Also among the funds with the highest
the constitutional interim President of Vene- level of certainty are those held by the name
zuela until credible presidential elections can of PDVSA’s U.S. subsidiary, CITGO, as the
be held” and since the same date “not recog- company regularly releases information on its
nized Mr. Maduro as President of Venezuela financial results to the public. The latest press
for any purpose.” 241 release indicates that CITGO Petroleum held
While the appeal has not been resolved, USD 2.1 bn in unrestricted cash and USD
the dissolution of the interim government 500 mn under its accounts receivable securi-
presents further complications for the case. tization facility by the end of 2022. 244
If courts decide not to recognize new board There might also be significant cash
appointments made by the 2015AN delegate deposits in bank accounts to the name
commission on the grounds that it is not a of other PDVSA-controlled subsidiaries,
constituted government, the only ones left although their value is far more uncertain.
authorized to represent the country could be PDVSA subsidiaries and joint ventures
those appointed before the interim dissolu- were barred from paying dividends to their
tion. parent company by the August 2017 financial
The second major component is 3,576 sanctions. While it is likely that deposits into
mn IMF SDRs, valued at USD 4.8 bn, these accounts ceased at some point after the
including SDR 3,568 mn allocated as part imposition of sanctions, any balance that was
of its 2021 IMF general SDR allocation and held in them at the moment of the imposition
8 mn preexistent SDR . 242 SDRs are a form would have been nearly impossible to mobilize
of reserve asset that can be used by IMF afterward.
member states either to carry out transactions There is some evidence that points to the
within the Fund or to voluntarily be traded existence of these accounts. First, consider
with other member states for currencies. On the situation of joint ventures involving U.S.
August 2021, the IMF performed a general oil company Chevron. As we explained in
allocation of SDR 456 bn (equivalent to USD Chapter 3, the company is a minority partner

Table 13: Liquid funds unavailable due to the political crisis or US sanctions
Conservative Baseline Optimistic

Source of Funds estimate estimate estimate Certainty
(USD mn) (USD mn) (USD mn)
PDVSA 2,600 5,188 6,482

CITGO Petroleum Unrestricted Cash &
2,600 2,600 2,600 Full
Cash-Equivalents
PDVSA Joint Ventures - 2,588 3,882 Low
BCV 7,019 7,019 7,019
Special Drawing Rights (SDRs) at the IMF 4,768 4,768 4,768 Full
Gold and proceeds of gold swaps held at the

2,107 2,107 2,107 Full
Bank of England
Account at the U.S. Federal Reserve 144 144 144 Full
Others/Unknown 1,667 1,667 1,667

Novo Banco 1,667 1,667 1,667 High
Other assorted bank deposits - 327 818- Mid
TOTAL 11,286 14,201 15,986
Source. CITGO 1Q 23, IMF webpage, BCV Ad-Hoc Board webpage, Lusa (2019), Venezuela Solidarity Campaign (2020)
in 4 joint ventures in Venezuela. These joint the total earnings of the joint ventures for
ventures were barred from making dividend USD 2.9 bn for both years. Of these, USD
payments to PDVSA since August of 2017. 1.9 bn belongs to PDVSA. Note that Pet-
Even if PDVSA were to attempt to force these ropiar, which accounts for USD 1.1 bn of
dividend payments using its majority stake these retained PDVSA earnings, accounts
in the company, U.S. law would prohibit the for only 15% of production in the Orinoco
bank holding the account from effectuating Belt, where other multinational investments
it. are concentrated.
In its 2018 Annual Report, Chevron re- There is also evidence of these bank
ported equity in earnings in its Petropiar accounts in court documents relating to
and Petroboscan projects totaling USD 329 certain U.S.-based trials involving victims
mn in 2017 and USD 674 mn in 2018. Since of the Colombian Fuerzas Armadas
Chevron has a stake of 30% in Petropiar and Revolucionarias de Colombia (FARC) whom
39.2% in Petroboscan, this corresponds to are attempting to seize Venezuelan funds as

EXISTING LIQUID FUNDS IN OFFSHORE BANK ACCOUNTS
restitution. 245 In several interconnected cases, of funds on deposit, given the existence of
the plaintiffs presented information showing doubts about the identity of the legitimate
that Petrocedeño –which was a joint venture representatives of these entities.” 249
between PDVSA (60%), TotalEnergies Adding to the uncertainty of the total
(30.32%), and Equinor (9.67%), until the available amount, Maduro-appointed Vice
latter two divested from their participation President Delcy Rodríguez claimed in a
in 2021– 246 held an account with USD 115 March 24, 2021, press conference that Ven-
mn in the U.S. branch of Sumitomo Mitsui ezuela had “more than” USD 7 bn in liquid
bank, while Petrowarao –a joint venture assets distributed among bank accounts in
between PDVSA (60%) and Perenco (40%)– Curacao, Lichtenstein, France, Luxembourg ,
had a 23 mn account in the same bank. 247 Bulgaria, Spain, Turkey, the U.S., Portugal,
There is also evidence of another account Switzerland, the UK, Germany, Belgium,
with USD 19 mn owned by Petrocedeño and and possibly other countries. After listing
several accounts to the name of Petro San the countries detailed in the text, Rodríguez
Felix – another PDVSA joint venture. said “as well as all of the countries in which
Based on this information, we estimate that we have blocked resources,” arguably imply-
PDVSA joint ventures hold between USD 2.6- ing that the list was not exhaustive. 250 A UK-
3.9 bn in undistributed earnings deposited at based advocacy group by the name of “Ven-
U.S.-based accounts. We regard these figures as ezuela Solidarity Campaign” also released a
fairly conservative given existing evidence that detailed report on the accounts supposedly
joint ventures such as Petrocedeño, which ac- frozen, which shows, among others, USD
counted for roughly 10% of joint venture pro- 517 mn in a Clearstream account in the UK,
duction in Venezuela in 2017, held an account USD 194 mn in bank accounts in Belgium,
with USD 115 mn in cash, and Petrowarao, USD 39 mn in France and USD 654 mn in
which accounted for less than 1%, held an ac- other banks and institutions. 251 We add a
count with USD 23 mn. conservative USD 327-818 mn to our esti-
There is also a high degree of certainty that mation to account for funds frozen in bank
Portuguese bank Novo Banco holds EUR 1.5 accounts outside the U.S. that may still have
bn (equivalent to USD 1.6 bn) belonging residual amounts.
to several Venezuelan government entities, Of all amounts discussed in this section,
including development bank BANDES and we believe USD 11.3 bn is virtually certain to
several PDVSA subsidiaries, but the share exist and available for humanitarian programs
belonging to each entity is unknown. 248 As under the right circumstances; however, re-
of March 2022, these funds were “current- alistically, we believe the range of available
ly in the process of a judicial consignment funds should be closer to USD 14.2-16.0 bn.

Potential Financing
from International Financial Institutions
Beyond the availability of frozen foreign de- categories. The most important are invest-
posits, Venezuela could also potentially re- ment loans, policy-based loans, and emergen-
quest financing from International Financial cy loans. Investment loans are the main in-
Institutions (IFIs). IFIs support economic and strument used by most MDBs and tie lending
social development in developing countries by to the implementation of a specific project by
providing financial assistance at affordable ra- conditioning disbursements on the verifica-
tes. Most IFIs fund their operation by issuing tion of eligible expenses. Initially, they were
debt in international markets, leveraging their designed to finance a single, specific infra-
prime/high-grade credit ratings to ensure low structure project; today MDBs provide many
funding costs, which generally requires that variations of the instrument that often pack-
they segregate concessional and non-conces- age investment loans into phases of a larger
sional funds, which are usually scarce. 252 Be- program. In contrast, policy-based loans seek
sides funding , they also provide significant to support sector or institutional reform by
technical assistance for the preparation and tying disbursements to the completion of pol-
implementation of programs. icy objectives. Emergency loans provide bud-
There are two global IFIs and two region- get support for economic crises but are tied
al Multilateral Development Banks (MDBs) to IMF programs and come at higher interest
that would be prime candidates to finance hu- rates and shorter maturities.
manitarian-oriented programs for Venezuela: Besides the type of loans that they provide
The International Monetary Fund (IMF), the and the objectives they target, each has dif-
World Bank (WB), the Inter-American Devel- ferent lending capacities and faces different
opment Bank (IADB), and the Andean De- hurdles that prevent financing the country. In
velopment Corporation (CAF). Due to each the next few pages, we review each multilat-
institution’s particular nature, cooperative eral entity’s status, constraints, and reach, as
humanitarian programs would likely have to related to potential humanitarian proposals.
be tailored to the particular lending practices All-in-all, we believe Venezuela could access
of each multilateral. USD 9 bn in multilateral financing with a co-
Puerta et al. (2023) categorize MDB financ- operative agreement between the parties in
ing instruments into seven broadly defined the political conflict.

Table 14: Potentially available multilateral financing, conservative estimate
Source of Funds USD mn

IMF (RFI) 7,411
World Bank 750
IADB 408
CAF 350
TOTAL 8,919
An analysis of voting rights at the four main 60% required threshold for the approval of de-
multilateral organizations shows a profound cisions at the bank. Unsurprisingly, the multi-
division, as roughly half of the shares are held lateral has been more open to consider lending
by countries that recognize Maduro as presi- programs for Venezuela, as explained at further
dent and the other half doesn’t. Furthermore, length in the following pages. In the case of the
key stakeholders with significant voting power IMF and World Bank, both institutions have in-
–most importantly, the U.S.– don’t recognize dicated that the uncertainty among its members
Maduro. In the case of CAF, 64% of A-Class over who to recognize prevents them from en-
shareholders recognize Maduro, more than the gaging with the government of Venezuela.
Table 15: Recognition of Venezuelan authorities at multilateral development banks by shareholder votes
as of July 31, 2023.
CAF
World
Recognition A-class B-class C-class IMF IADB
Bank
stocks stocks (2) stocks
Fully Recognizes Maduro 64% 63% 87% 47% 49% 48%
Holds diplomatic relations with Maduro,
0% 0% 0% 5% 5% 1%
Recognizes 2015AN
Holds diplomatic relations with both;
0% 0% 0% 6% 7% 5%
Recognizes 2015AN
Relations with neither; Recognizes 2015AN 9% 7% 0% 1% 1% 1%
Diplomatic relations with Maduro; none 0% 0% 0% 13% 12% 3%
Only Recognizes 2015AN (1) 0% 0% 0% 17% 16% 30%
Diplomatic relations with both; none 9% 23% 13% 0% 0% 2%
Relations with neither 9% 0% 0% 10% 10% 5%
Venezuela 9% 6% 0% 1% 1% 3%
TOTAL (3) 100% 100% 100% 100% 100% 100%
(1) Includes countries recognizing 2015AN which have relations with neither governments.
(2) Remaining 0.1% of stocks in hands of private commercial banks.
For approval, CAF shareholder’s ordinary decisions require 60% of class-A shareholders to vote in favor, and 50%+1 of B
and C class shareholders to vote in favor.
Source. Own elaboration based on CAF, IMF, WB, and IADB.

The International Monetary Fund (IMF)
The IMF was founded during the Bretton Woods balance-of-payments needs in the context of a
Conference in 1944 with the primary purpose of macroeconomic program are Stand-by Facilities.
dealing with balance of payments crises. The insti- These include both the Stand-by Agreements (SBA)
tution currently has 190 member countries and the typically used by middle-income countries and the
second-largest loan portfolio in the group – after shorter-term Stand-by Credit Facility (SCF) used
the World Bank – with outstanding credit currently by low-income countries. There is also the longer-
at USD 153 bn.253 term Extended Fund Facility (EFF) designed for
The traditional IMF loans used to address countries that are undertaking structural reforms
Table 16: Conditions and requirements for existing IMF funding options (part 1)
Program
Funding Eligibility
duration
Stand-by All members facing actual or potential external financing
1 to 3 years
Traditional Agreement needs. Typically used by middle-income countries.
lending 3 years out
agreements Standby Credit
Low income countries with short-term BoP needs. of any 6-year
Facility
period
Extended Credit All Poverty Reduction and Growth Trust-eligible countries
3 to 5 years
Extended Facility facing a long standing BoP problem.
lending
agreements Extended Fund Assistance for countries experiencing serious payment
Up to 4 years
Facility imbalances due to structural issues or slow growth.
Flexible Credit Crisis prevention and mitigation for countries with “strong Initially 1 to 2
Line policy frameworks” and “strong economic fundamentals.” years
Potential, moderate, short-term balance of payment

Short-term
Credit lines needs for countries with strong policy frameworks and 1 year
Liquidity Line
fundamentals facing external shocks.
Actual or potential BoP needs of countries with sound
Precautionary Six months to
policies and fundamentals who “May have some remaining
and Liquidity Line 2 years
vulnerabilities,” (and can’t use an FCL).
Rapid Financing All member countries facing urgent BoP needs due to Single
Instrument transitory and limited shocks. disbursement
Emergency
facilities Low income country urgent balance of payment needs.
Rapid Credit Single
Where full-fledged economic programs are either
Facility disbursement
unnecessary or not feasible.
Source. Own elaboration based on IMF.

Table 17: Conditions and requirements for existing IMF funding options (part 2)
Con-
Ex-post Venezuela
Funding Funding limits Reviews? cessio-
conditions? eligible?*
nal?
Annual 187.5% of the country’s

Stand-by
quota, 300% of the quota for Yes Yes No Yes
Traditional Agreement
full program.
lending
agreements Standby 145% of the country’s quota on
Credit a yearly basis, 435% quota on a Yes Yes Yes No
Facility cumulative basis.
145% of quota per year, 435%
Extended of quota on a cumulative basis.
Credit Hard caps on exceptional Yes Yes Yes No
Facility terms are 133.33% yearly and
Extended 400% cumulative.
lending
agreements Annual 187.5% of the country’s
Extended quota, 300% of the quota
Fund for full program. Exceptional Yes Yes No Yes
Facility access beyond these limits
may apply.
Annual 187.5% of the country’s
quota, 300% of the quota
Flexible
for full program. Exceptional Yes No No No
Credit Line
access beyond these limits
may apply.
Credit lines Annual 187.5% of the country’s

Short-term
quota, 300% of the quota for No No No No
Liquidity Line
full program.
Precautionary Outstanding credit beyond

and Liquidity 187.5% of quota, rising to Possible Possible No No
Line 300% after three years.
Rapid 50% of quota at a yearly

Financing basis, 100% of quota on a No Possible No Yes
Instrument cumulative basis.
Emergency
facilities
Rapid Credit 50% quota per year, 100%
No No Yes No
Facility quota on a cumulative basis.
Source. Own elaboration based on IMF.
over longer periods and an Extended Credit Facility problems. The Fund also offers credit lines –the
(ECF) given on concessional terms to poorer Flexible Credit Line (FCL), the Short-Term
countries with long-term balance of payments Liquidity Line (SLL), and the Precautionary and

Liquidity Line (PLL)– which can be sizable but are tion to the IMF, as well as receiving an assessment
designed to ideally not be used. Finally, there are the by the Fund that the country’s debt is deemed sus-
rapid loans: the Rapid Financing Instrument (RFI) tainable (or on track to become so).
and the Rapid Credit Facility (RCF) designed to Current IMF regular access conditions for the
help countries deal with urgent balance of payments RFI allow lending up to 50% of the country’s quota
needs without the requirement of a program. per year and 150% on a cumulative basis.255 If the
The IMF’s credit lines (FCL, SLL, or PLL) re- country is considered to be under the effects of a
quire sound or strong economic fundamentals “large natural disaster” that has resulted in damage
and policy frameworks, while concessional financ- on or above 20% of GDP, the fund can lend up to
ing arrangements (ECF or RCF) are open only to 80% per year and 183.33% on a cumulative basis.
countries eligible for International Development The Fund also offers lending of up to an addition-
Association (IDA) financing. Venezuela is current- al 50% of the quota on top of the prior-mentioned
ly uneligible for both sets of instruments and will limits that can be used between September 2022
likely remain so in the medium term. An SBA or and March 2024 if the country is facing “urgent bal-
EFF would likely be at the front stage of a recovery ance of payments needs due to acute food insecuri-
program in the context of a full resolution of the ty, a sharp increase in the food or fertilizer import
legitimacy crisis, but access in current conditions is bill, or a shock to cereal exports.”256
highly unlikely, if not impossible. Venezuela currently has a quota of SDR 3,723
This leaves the RFI as the most viable IMF financ- bn257 (USD 4.9 bn at the current USD/SDR valu-
ing instrument for the implementation of a program ation).258 Given the country’s quota, regular access
in the short term. The facility was created in 2011 as for Venezuela would amount to USD 2.5 bn per
part of a revamp of the IMF’s financing options in re- year or USD 7.4 bn on a cumulative basis. Howev-
sponse to the Global Financial Crisis and is designed er, repeated use within a 3-year period requires that
to help countries facing urgent balance of payments the country’s access to be primarily caused by an ex-
needs, such as those generated by sudden shocks like ogenous shock or by the country having “an estab-
natural disasters,254 and does not require the coun- lished a track record of adequate macroeconomic
try to have a full-fledged economic program nor to policies.”259
have strong economic fundamentals or a solid policy In terms of recognition, the IMF position
framework, unlike other IMF instruments. regarding the question of Venezuela was estab-
There are however important requisites that the lished publicly in March 2020, when the Mad-
requesting country must meet, including cooperat- uro administration addressed a letter to Manag-
ing to find a solution to its balance of payment is- ing Director Kristalina Georgieva requesting a
sues, commiting to refrain from imposing trade or USD 5 bn loan under the RFI facility to attend
capital controls, undergoing safeguard assessments, the Covid-19 crisis.260 The IMF responded by
providing detailed central bank financial informa- citing the diverging views among its members

THE INTERNATIONAL MONETARY FUND (IMF)
on which of the two competing claims over the (or on track to become sustainable) and a demon-
country’s presidency should be recognized, not- stration that it is pursuing appropriate policies to
ing that this lack of consensus prevented it from address the balance of payments crisis in question.
considering the request.261 An IMF spokesperson Typically, sustainability is evaluated by sim-
said that “IMF engagement with member countries ulating the debt stock’s behavior over different
is predicated on official government recognition fiscal policy scenarios, given the interest rate, the
by the international community, as reflected in the economy’s growth rates, and other debt param-
IMF’s membership. There is no clarity on recogni- eters. Applying this framework to Venezuela in
tion at this time.” its current condition raises several complex ques-
Maduro then downsized his request to USD 1 tions, given that it is unclear what the relevant
bn, arguing that “the emergency funds could be allo- cost of financing is for a country to which it is il-
cated through programs designed to purchase food, legal to lend to (as a result of U.S. financial sanc-
medicine and improve some hospitals’ infrastruc- tions) and has no intention to pay its past cred-
ture to care for coronavirus patients.”262 This request itors as long as this restriction is present. What
appears to have had some quiet diplomatic support would put us closer to a standard IMF scenario
from Europe, as EU foreign policy chief Josep Bor- would be one in which the political agreement
rell stated on March 23rd in a news conference held between the parts entails a commitment to at-
just two days after Venezuela’s second request that tempt to restructure Venezuela’s debts.
the EU “agree[s] in supporting the request by Iran On October 10, 2022, Bloomberg reported that
and also by Venezuela to the International Mone- the Maduro administration had sent a letter urging
tary Fund to have financial support”.263 the IMF to recognize his administration. The con-
The requests (and the IMF’s refusal to consider tents of the letter have not been made public, but
them) came at a time in which the IMF was rapidly the Bloomberg note states that it was penned by
expanding its loan portfolio under the RFI modal- Vice President Delcy Rodríguez, who argues that
ity, which has limited conditionality. In the eight “there’s no doubt among the international commu-
months beginning in March 2020, the IMF more nity that efforts to oust Maduro have failed, and
than doubled the funding given out to member that Venezuela enjoys political stability.”264
countries under all its financial modalities when The IMF is formally a specialized UN agency
compared to the twelve-month period preceding but retains independence and can decide to deal
the pandemic (March 2019 to February 2020). Ac- with specific governments independently of the UN
cess to RFI facilities does not require a fully-fledged General Assembly. The decision of what govern-
economic program to be in place, nor that the coun- ment to deal with is taken by the Managing Direc-
try enjoys strong economic fundamentals or a solid tor, based on the recommendations of staff. These
policy framework. However, it does require that the acts are assumed to be endorsed by the Executive
country’s debt be deemed sustainable by the IMF Board or Board of Governors, who have the compe-

tence to settle doubtful or disputed claims.265 There tion of no government (Somalia in 1992) and for
is no formally documented operational policy on the recognition of an authority other than that ex-
dealing with an entity as a member’s government, ercising effective de facto control over the territory
but the multilateral does have a history of consistent (Haiti in 1991). In practice, the key relevant point
application of certain practices.266 is establishing the relevant interlocutory agency,
IMF staff tend to follow the views of the “inter- which could be a country’s “Treasury, central bank,
national community” on recognition issues, but stabilization fund, or other similar fiscal agency.”267
the exact meaning of the term and who are the rel- In this case, the relevant interlocutory agency
evant veto players is subject to various alternative would be the central bank.
interpretations. In situations where there is a lack of However, this is not the only obstacle for a pro-
clarity, staff determines whether a majority of vot- gram, as the IMF’s Article of Agreements may impose
ing power in the Fund chooses to recognize or deal other conditions, such as the requirement that the
with an authority as a government in their bilateral country is able to adequately safeguard IMF resources.
relations. There is precedent for both the recogni-
The World Bank Group (WB)
The World Bank Group was also founded du- ment Disputes (ICSID) works as a venue for
ring the Bretton Woods conference in 1944. dispute resolution for international investment.
It is primarily composed of the International The IBRD and IDA combined have a total
Bank for Reconstruction and Development loan portfolio of USD 402 bn, almost 3 times
(IBRD), which provides financing to midd- that of the IMF.268 The World Bank’s primary
le-income and creditworthy low-income coun- financing instruments are Investment Project Fi-
tries, and the IDA, which focuses on providing nancing (IPF), Development Policy Financing
concessional financing and grants for low-inco- (DPF), and Program-for-Results (PforR) Fi-
me countries. Other entities in the group serve nancing. IPF lending is focused on infrastruc-
specialized purposes: the International Finance ture and developing institutional capacity, DPF
Corporation (IFC) provides financial and te- supports policy and institutional reforms and
chnical assistance to private sector participants PforR directly links disbursements to program
in developing countries, the Multilateral In- goals.
vestment Guarantee Agency (MIGA) provides On an individual basis, World Bank financ-
guarantees for cross-border investment, and the ing facilities are usually of a smaller scope than
International Centre for Settlement of Invest- those of the IMF but are usually set up for

THE WORLD BANK GROUP (WB)
longer terms and don’t impose broad macro- mains in power by means not provided for in
economic conditionality strictly speaking, but the country’s constitution, such as a coup d’état,
rather work on a project-by-project basis. How- revolution, usurpation, abrogation or suspen-
ever, World Bank financing is in practice tied to sion of the constitution.” Labeling a govern-
IMF lending. ment as de facto requires an interpretation of
We estimate that World Bank lending to Ven- the country’s constitution, which by itself may
ezuela could amount to USD 750 mn. To obtain entail siding with the view of one of the parts
this figure, we use the World Bank’s annual lend- in conflict. That would be the case in Venezue-
ing figures for a set of comparable countries269 (as la, where both the opposition and the Maduro
a share of their GDP) between 2020 and 2022. administration claim that their positions are
IBRD grants financing on a project basis, which based on the country’s constitution. It further
renders estimations of funds accessible through adds that a decision to engage in financing op-
the multilateral as difficult. However, consider- erations with a de facto government “does not
ing Venezuela’s humanitarian crisis, the country in any sense constitute Bank ‘approval’ of the
has considerable space to devise development-re- government, nor does refusal indicate ‘disap-
lated projects that could be strong candidates for proval’,” it merely reflects the bank’s policy of
IBRD financing. Thus, we consider USD 750 not interfering with the internal political affairs
mn a lower bound estimation of the financing of members.
accessible through the multilateral if the recog- Conditions to maintain existing operations
nition problem is solved. with de facto governments are minimal; the
In contrast to the IMF, there has been no pub- World Bank basically requires that the govern-
lic statement from the World Bank regarding ment be in effective control of the territory, rec-
the issue of recognition. However, according to ognize pre-existent international obligations,
a story published by Reuters in April 2019, the and ensure the continued implementation of
World Bank was at a similar impasse to the IMF the program or project in question. When
in terms of recognition.270 The institution’s more dealing with new operations with de facto gov-
detailed public guidance on recognition can ernments, the World Bank’s requirements are
prove clarifying, not only on its own reactions to somehow more demanding, as the multilateral
a potential cooperative approach but also on the evaluates:
possible reaction of the IMF to different scenari-
os associated with Venezuela. •Whether the operation would expose it
The multilateral’s Operation Manual has to “additional legal or political risks.”
provisions explicitly detailing dealings with de •Whether the government is in effective
facto governments.271 The manual defines a de control of the territory, is reasonably
facto government as one that “comes into, or re- stable and publicly accepted.

•Whether the government recognizes •The position of other international organi-
pre-existent international obligations, zations toward the government.
particularly those with the World Bank Of these, the first and last present the hard-
itself. est challenge at the present time but could be
•The number of countries (particularly given a fairly simple solution in the context of
neighboring ) that have recognized a political agreement between the parties in
the government or dealt with it as the dispute. In our view, other requirements can be
government of the country. reasonably established to be in fulfillment.
The Inter-American Development Bank (IADB)
The Inter-American Development Bank is a regio- vide flexible financing to support policy reform
nal multilateral established in 1959 to promote or institutional changes in a sector or subsec-
economic and social development in Latin Ame- tor.277 Special development lending target budget
rica and the Caribbean. It has 48 member coun- support to attend to macroeconomic crises.278
tries, including both borrower and non-borrower Eligibility for policy-based loans requires “a
nations. Its focus is to support sustainable develop- sound macroeconomic policy framework, as de-
ment, reduce poverty and inequality, and promote termined by an independent assessment of mac-
productivity, innovation, and inclusive growth.272 roeconomic conditions elaborated by the IADB”
As of the end of 2022, the IADB’s total loans and the loans are disbursed in tranches based on
and guarantees amounted to USD 113 bn,273 a the completion of program objectives.279
large portfolio for a regional MDB. The bank Member states whose per capita income is be-
provides financing in three lending categories: low USD 2,834 at 2015 prices280 (equivalent to
investment lending, policy-based loans, and spe- USD 3,577 in current dollars) or lack the credit-
cial development lending.274 Most IADB lending worthiness to borrow under the IADB’s regular
is provided under the first two categories, which Ordinary Capital terms can opt for concessional
accounted for 49% and 42% of the sovereign allocations of resources.281 Given that Venezuela
loans approved in 2021, respectively.275 meets both conditions, it is likely that the coun-
Investment loans can be designed to attend to try would be eligible for concessional lending.
short, medium, or long-term needs, and come as As of the end of 2021, Venezuela maintained
result-linked loans, project-based loans, multi- a USD 2,011 mn debt with the institution, of
phase program loans, multiple works programs, which USD 1,323 mn was in arrears,282 which
and other modalities.276 Policy-based loans pro- the country would have to pay as a requisite for

the disbursement of financing. A second contended. When Hausmann stepped down, citing
straint is Venezuela’s limited capacity to service academic commitments, shortly thereafter, the
any contracted debt. Guaidó administration replaced him as the Ven-
Unlike the IMF and World Bank, the IADB ezuelan governor with Alejandro Plaza, a former
recognized Guaidó as the legitimate president of partner at McKinsey & Company. Nevertheless,
Venezuela two months after he assumed office. as of this writing there is no appointed governor
In March 2019, the bank voted to replace the for Venezuela in the list of country representa-
Nicolás Maduro appointee with Juan Guaidó’s tives on the IADB website; however, Mariela
nominee, economist Ricardo Hausmann, two Magallanes, a lawmaker of the National Assem-
weeks before its annual meeting, set to be held bly elected in 2015, is listed as an alternate for
in China. The IADB had to cancel the meeting, governor for Venezuela.
as China refused to allow Hausmann to attend However, over the years, recognition by mem-
given that the country recognized the Maduro ber countries has significantly shifted. Today,
administration.283 An anonymous source cited 22 out of the IADB’s 48 members recognize the
by Reuters said that China had proposed that administration of Nicolás Maduro as the govern-
neither Maduro nor Guaidó’s representative at- ment of Venezuela.
The Andean Development Corporation (CAF)
The Caracas-based regional multilateral Ande- the institution reduced its engagement with
an Development Corporation was founded in Venezuela significantly. Venezuela’s failure to
1970. Unlike the IADB, CAF’s membership is service existing loans starting in 2017,286 became
more restrictive, including only two countries – a political problem as the bank’s large exposure
Spain and Portugal– outside of Latin America to the country could have compromised its
and the Caribbean.284 Two consequences derive credit rating. In 2017 and 2018, CAF addressed
from CAF’s ownership structure; the bank’s the issue by rolling over existing loans into new
approval process is regarded as more agile and ones, thus preventing a default in a technical
the MDB’s costs of funding are higher given the sense, but the practice was discontinued in 2019
lack of backing from developed non-borrowing due to political pressure from the opposition
economies.285 In fact, CAF’s own bonds carry a and its allied member states, who argued that
AA- rating, 3 notches below the IADB’s AAA. any new loans required legislative approval and
CAF continued to recognize the government equated lending to the Maduro administration
of Nicolás Maduro even after Juan Guaidó as- to “financing a dictatorship.”287
sumed as interim president in 2019, although In March 2020, CAF implemented a new

mechanism allowing it to buy back the shares country remains current thanks to the previous-
of member states to settle defaulted debt ser- ly described share buyback mechanism. News re-
vice payments.288 Thanks to the application of ports indicate that CAF is considering loans for
this mechanism, Venezuela remains current with the Venezuelan government, including a USD 3
CAF (and is expected to remain so at least until bn investment to rehabilitate the country’s elec-
2024 by Fitch)289 but its interest in the multi- trical generation and distribution system, as well
lateral had been reduced by 64% from 168,678 as other infrastructure works.292
Class B shares (17% of the total) at the end of We believe that CAF could provide at least
2019 to 59,985 (6%) by December 2022.290 USD 350 mn in additional loans considering
However, the mechanism was criticized by the that the organization was reportedly willing to
Venezuelan opposition, which publicly called issue a loan in that amount to improve the coun-
for CAF to stop applying it and declare Vene- try’s electrical grid back in December 2019.293
zuela in default.291 It is noteworthy that the ini- The financial resources acquired through the
tiative was approved by CAF’s board despite the loan were set to be administered by the United
fact that 13 of 19 board members recognized Nations Development Programme (UNDP),
Juan Guaidó as the country’s president at the with the project requiring approval from the
time. 2015AN. Despite these preparations, the proj-
Venezuela has an outstanding debt of USD ect was set aside by the 2015AN following ob-
2,513 mn with CAF, which represents 8% of the jections from multiple opposition legislators
multilateral’s USD 30.6 bn portfolio, but the who raised objections to the project’s design.294
Where to Direct Multilateral Funds
Multilateral funds can be used for direct assistan- the authorities’ cost-benefit analysis and public
ce programs, including conditional cash transfers, policy priorities.
or for the rehabilitation of basic infrastructure, If funds are channeled to direct assistance pro-
particularly that associated with the provision of grams, one alternative would be to deploy them
public goods, such as electricity and water supply. by funding the existing initiatives of humanitar-
The implementation of either alternative would ian organizations and NGOs operating in the
depend on several factors, including the approval country. As we detail in Chapter 2, the interna-
of funding by IFIs for specific projects, as well as tional humanitarian response to the Venezuelan

crisis is chronically underfunded, which means pends on the Guri hydroelectric plant, which has
there are a significant number of identified pro- suffered considerable damage from years of un-
grams and priorities that could benefit from derinvestment and lack of maintenance. Despite
the availability of funding. Another alternative the lack of investment, the plant – alongside other
would be to funnel the funds through govern- thermoelectric plants – possesses the capacity to
ment programs, although the possibility would produce close to 32,000 megawatts. However, ac-
require a major redesign and depoliticization of cording to the local NGO Grupo Orinoco, reha-
existing initiatives. We discuss this topic at fur- bilitating the electricity generation infrastructure
ther length in Chapter 6. would require more than USD 15 bn in invest-
OCHA funding data for the 2021-2023 Hu- ments carried out in a 3-5 year period.296
manitarian Response Plans for Venezuela indi- In March 2019, the country recorded its first
cates that 27% of the required funds would be massive blackout. The failure reportedly occurred
employed for healthcare projects, 25% to food in the Guri hydroelectric power plant. The event
security and nutrition, and 16% to water sanita- affected 23 states of the country for at least 4 days.
tion.295 Direct assistance programs under a coop- According to estimates published by the portal
erative humanitarian design would likely focus in Prodavinci, 60% of the Venezuelan population
the same areas. lives in areas that were subject to formal rationing
Alternatively, funds could be deployed to reimposed in response to the blackouts. The ra-
habilitate existing infrastructure necessary for the tioning plan established supply cuts for 3 hours a
provision of public utilities. Electricity generation day, although social media users claimed that cuts
and the distribution of clean water are among the could last as long as 10 days in a row in 2019.297
areas where investment could have a significant Workers of the Guri hydroelectric power plant
impact on improving humanitarian outcomes, as have stated that the failure in March 2019 result-
the country has been struggling with crumbling ed from the lack of maintenance of the transmis-
infrastructure and deficient utility provision for sion lines, not of the generation systems.298 Like-
years. wise, Guri employees assured that due to the lack
This type of investment could have direct hu- of weeding between the Malena electric substa-
manitarian results, as well as facilitate the broad- tion, north of the Bolivar state, and the Guri, a fire
er economic recovery. For instance, investing in occurred that damaged the 765kV transmission
electric generation can help ensure that hospitals, lines, returned power to the Guri generating ma-
schools, and other essential services have access to chinery, which were shut down for protection.299
reliable power, while also helping facilitate eco- In spite of this, during the prolonged 2019
nomic growth in industries that are currently con- blackout, Venezuela had only one-fifth of its
strained by the lack of access to electric power. thermal power plants operating, which made it
Eighty per cent of Venezuela’s power supply de- impossible for the equipment to enter the backup

WHERE TO DIRECT MULTILATERAL FUNDS
phase and thus replace the energy generated in the units. Numerous experts have claimed that the
dams. Economic sanctions almost certainly had electric system would not support an increase in
an adverse effect on the operating capacity of this industrial capacity without improvements. 302
backup system. Generating plants operate with A May 2022 survey by OVSP also found that
diesel imported from the U.S. but, as a result of only 28% of respondents reported having a con-
sanctions, the country was prevented from bringing tinuous water supply, while 56% reported re-
in fuel to run them. In the same way, Venezuelan ceiving the service 3 days per week or less (out
electricity production and transmission depends of which a whopping 27% reported receiving the
to a large extent on components from foreign service once every 15 days or less).303 The problem
companies such as Siemens and General Electric has also resulted in adaptation mechanisms such
(GE), which also supply power generators to the as domestic water storage, which 87% of respon-
oil industry, some of which were adversely hit by dents reported resorting to due to intermittent or
the restrictions that 2017 financial sanctions had absent supply.304 Besides supply deficiencies, 59%
on their ability to sell or collateralize the New of respondents report that water arriving through
York law promissory notes that the Venezuelan pipes presented some form of coloration, 25%
government had issued to restructure its debts some form of odor, and 24% some form of fla-
with them.300 vor.305
In February 2023, local NGO Observatorio Besides the obvious quality of life impact of
Venezolano de Servicios Públicos (OVSP) released lacking or having intermittent access to basic ser-
a survey covering 12 of the country’s largest cities vices, this situation poses a challenge to the recov-
that shows a small 5.4 percentage points improve- ery of the Venezuelan economy, as well as to pub-
ment in the user evaluation of public utilities lic health. For instance, PDVSA has frequently
between December 2022 and December 2021, been forced to stop domestic refining operations,
primarily due to a decrease in electricity supply which contribute to fuel scarcity.306 Irregular
downtime.301 However, the same study found that electric supply can also damage industrial equip-
supply problems are grave and persistent; overall ment, as was the case during the extended 2019
13% of the respondents reported experiencing blackout, which damaged machinery in the met-
cuts in electricity supply every day of the week, allurgical sector.307 These effects are just examples
34% between 1 to 6 days per week, and only 34% of how a defficient electricity supply can set back
claimed to “never” or “almost never” experience economic performance; the effects on the health
such cuts. sector can be even more dramatic, as power cuts
Blackouts have affected the quality of life of can threaten the lives of pacients that rely on med-
Venezuelans and have also had a negative impact ical equipment for treatment, such those requir-
on PDVSA’s production, which has closed severing hemodialysis.308
al oil fields due to the lack of energy in pumping

Boston Group Proposal for the Electricity Generation Sector
In November 2019, the Boston Group released a ministration, iv) one delegate of the Guaidó
proposal for the government to borrow up to USD administration, v) one National Assembly law-
350 mn from CAF to address the severe electricity maker aligned with the Maduro administration
generation shortage in the country in the short- and vi) one National Assembly lawmaker aligned
term.309 The program would have been managed by with the opposition. The body would have been
the United Nations Development Programme and tasked with managerial decisions, approval of
would have targeted four of the country’s regions, budgets, risk assessment, and project oversight.
deemed the most affected by energy blackouts, and The Boston Group also suggested the creation
hospitals at the nation-wide level, planning for an of a smaller five-member technical committee
increase in electricity-generation capacity of more incorporating one delegate nominated by each
than 1,071 MW (a 3% increase over the estimated political faction, one delegate nominated by each
capacity at the time).310 international organization, and one civil society
Roughly 2/3rds of the investment would have representative. The exact proposed distribution
been destined for the western state of Zulia, which of attributions between the governing board and
has for long been the most affected by the deficit the technical committee was not entirely clear
in electricity generation and would have benefited from their proposal, although it appears that the
from a projected 390 MW increase in supply.311 latter would have had primarily an advisory role.
The Andean region, in second place, would have Notwithstanding the proposal for the cre-
received a USD 65 mn investment for a 480 MW ation of a political governing board and a tech-
increase in supply. The rest of the investment would nical committee, the project itself would have
have been distributed between national hospitals, been implemented by UNDP, which would have
the capital region, the state of Nueva Esparta, and handled procurement, contracting, and con-
procuring assorted technical assistance. struction works. CAF disbursements would have
Similar to other proposals reviewed in this gone directly to UNDP.
document, the Boston Group suggested that the A Boston Group public letter dated Novem-
program should have been managed by a gov- ber 7, 2019, mentioned that “one of the parts”
erning board that balances Maduro and Guaidó- (presumably, the Maduro administration) had
aligned forces with neutral delegates appointed already agreed to the project and urged the
by international organizations. The governing 2015AN to approve a law authorizing the loan.
board would have been composed of i) one rep- Later that month, a legislator from the opposi-
resentative from UNDP, ii) one representative tion party UNT, introduced the law project for
from CAF, iii) one delegate of the Maduro ad- discussion in the National Assembly, citing an

even higher 1,200 MW target.312 The project In November 2019, the 2015AN created a
had some differences with respect to the original joint commission consisting of the Permanent
Boston Group proposal, including an expanded Administration and Services Committee and the
role for the National Assembly in the governing Energy and Oil Committee to assess the project
board and no role for the Maduro administra- and other possible solutions to the energy cri-
tion, but ultimately would have enabled the gov- sis.315 However, a month later the 2015AN ple-
ernment to contract the loan.313 nary deferred the discussion of the project citing
However, the project met political resistance a lack of consensus in the body,316 and the project
in the National Assembly and was criticized by was ultimately shelved. Contemporary news re-
local NGO Transparencia Venezuela and some ports indicate that some deputies from the ben-
experts quoted by media outlets, which ques- eficiary regions (and especially members of Zu-
tioned the role of parts of the government under lia-based UNT) had advocated strongly for the
the control of the Maduro administration – in- project, but leading national parties associated
cluding the national electricity company, Cor- with the Guaidó administration had opposed it.
poelec – in its implementation, as well as political Other commentators took a more overtly politi-
and financial questions relating the entity which cal angle, saying that approving the loan was tan-
would contract and repay the loan.314 There were tamount to recognizing the Maduro administra-
also accusations that the budgeted expense had tion as legitimate and going as far as questioning
not been properly evaluated and was inflated. CAF’s neutrality in the whole affair.317
The Oil for Venezuela Proposal
In April 2021, the Oil for Venezuela Founda- society.

tion published a detailed proposal designed to In the proposal, the formation of consensus
enable the country to employ existing frozen fo- governing instances would have been imple-
reign currency bank accounts held abroad and mented through a political agreement between
potentially available multilateral loan facilities the Maduro and Guaidó administrations that
to attend the humanitarian crisis in the context would have been predicated on humanitarian
of the Covid-19 balance of payments shock. 318 grounds and would be ageed upon separately
The core of the proposal consists in the forma- from negotiations on broader political issues.
tion of consensus governing instances by the Without overlooking the relevance of solving
Maduro and Guaidó administration, which the political legitimacy crisis, the authors ar-
would have the legal capacity to access funds gued that addressing the Venezuelan humani-
and employ them for the benefit of Venezuelan tarian crisis should not be subordinated to the

achievement of a negotiated political solution other humanitarian challenges still ongoing in
that remains uncertain. The starting point for the country.
this agreement would be the identification of The paper formulates two potential ap-
the quantity of funds required to attend the cri- proaches for negotiated mutual-recognition
sis, the purposes for which they would be em- consensus governing agreements:
ployed, and the sources from which they can be •A single government solution, under
obtained. which the competing Maduro and
While the paper identifies a significant num- Guaidó administrations would agree
ber of alternative liquid funds and sources of that one of them will represent the
financing, it primarily focuses on developing country before a given multilateral
mechanisms to access potential IMF lending agency. In order to prevent the deal
and international reserves in the form of de- from being constructed as a concession
posits at the Bank of England and IMF SDRs. from one side to the other, the political
However, its general ideas can, in principle, be negotiation could stipulate that the
adapted to access and deploy many other exist- parts would support each other’s
ing liquid assets or potential financing sources. representatives for different international
The proposal was originally formulated amid organizations. Operationally, one of the
the Covid-19 crisis and many of the ideas it sug- governments – for instance, the Guaidó
gests are focused on attending to key problems administration – would publicly express
that arose from the pandemic. Such problems support for multilateral engagement
included subsidizing income earners forced to with the other – in this case, the Maduro
stay at home, funding health-related expenses, administration – subject to a political
providing general budget support to amelio- agreement on the use of any financing
rate the macroeconomic impact of lost external obtained.
revenues, and transferring stipends to migrants •A single central bank solution, under
in conditions of vulnerability. The policy brief which the competing administrations
estimated a total program cost of USD 8.5 bn would jointly appoint a central bank
over two years, which would come from a USD board that would act as Venezuela’s
7.7 bn RFI loan and the USD 2 bn Bank of En- fiscal agent before multilaterals, and
gland currency deposit. While both funding thus take charge of the relevant rights
sources remain available to this date, the need to and obligations. The implementation
address the COVID-19 pandemic is now much details of this mechanism are somehow
lower than when the paper was first published. more involved. We go over the main
However, the basic framework as put forward points in the next few pages. Mutually
in the proposal can easily be adapted to several agreed designation of the board would

THE OIL FOR VENEZUELA PROPOSAL
dissipate the legal uncertainty as to its controlling entity of international reserves

authorization to handle Venezuelan and many of the most visible foreign-currency
government assets. Furthermore, if the deposits held abroad. This makes it the most
deal is formulated in the context of attractive entity for a proposal involving
international support for the initiative, consensus appointments. The second most
the risk of any foreign government attractive one would likely be the board of
deciding to block its actions would also PDVSA, which controls sizeable external liquid
be minimized. assets, including (indirectly) those belonging
Many applications would require both solu- to CITGO. While the paper confines itself
tions to be implemented together. They should, to the former, the ideas presented could easily
thus, be regarded as complementary instead of be extended for the formation of a consensus
opposite. On the one hand, the Guaidó admin- board for the latter.
istration has sole legal access to the U.S. bank- Per BCV law, the Venezuelan president ap-
ing system, which means that a single central points six board members and the president
bank would be required to channel payments (governor) of the institution for seven-year
through the U.S. even if the Maduro adminis- terms. There are small differences in the ver-
tration were chosen as the single government sion of the BCV law that each administration
to represent Venezuela before any given multi- recognizes as valid, which introduces some nu-
lateral. On the other, while IMF guidelines on ances to the nomination requirements, but ulti-
recognition are sufficiently vague to work with mately the negotiated process can be explained
a single central bank solution by itself, the mul- in the simplest terms as requiring that each
tilateral could apply a strict interpretation and administration secure the resignation of the
require the recognition of a single government board members it appointed and subsequently
as well. appoint consensus designees. The natural way
In addition to a domestic political agreement, to do so would be for each administration to
most applications would also require some level nominate three members to the board and ne-
of cooperation from the country in which the gotiate a seventh that is regarded by both par-
funds are held or through which they would be ties as neutral. This last member would act as
mobilized. For instance, deploying liquid funds president and would have the tie-breaking vote.
held by CITGO requires that OFAC issue a li- Once a BCV board is in place, each admin-
cense allowing the company to distribute divi- istration could separately approve loan or fund
dends to its shareholder. withdrawal requests for equal amounts, which
Venezuela’s central bank is the institution would then be channeled by the consensus
tasked with interacting with the IMF as the board’s governor to the appropriate institution.
fiscal agent of the Republic. 319 It is also the In the case of operations involving interna-

tional reserves, a mechanism would have to be sentatives of an international organization.
established to effectively deploy the funds, giv- The Administrative Board would be subject
en the constitutional ban on the central bank if to legislative oversight, as any part of the Vene-
the financing of the fiscal deficit. A precedent zuelan State. This oversight would include the
for such a mechanism was established in 2020 National Assembly’s approval of its budget. To
when the interim government struck an agree- address the problem of disputes on legitimacy,
ment with its BCV board for a USD 80 mn loan the Oil for Venezuela Foundation recommends
destined for emergency spending which would that the Administrative Board submit its pro-
be payable “within 60 days of the end of the posed multi-year budget for approval by both
usurpation” and which carries an interest rate the 2015AN and 2020AN. In subsequent years,
of 3-month LIBOR + 0.5%.320 Other options the board could present modifications to the
include the creation of a special entity, separate budget for approval or even present an alto-
from the executive, that wouldn’t be restricted gether new budget. It also recommends setting
from receiving BCV loans under a flexible in- up an independent High-Level Committee,
terpretation of the legal framework. Alterna- composed of non-aligned independent experts,
tively, the program could make use of existing to oversee compliance with the program agree-
legislation that allows the transfer of excess ment. The committee would have the ability to
international reserves to the National Devel- suspend the program in case it determines that
opment Fund FONDEN. However, the most the parts are not complying with the agreement.
transparent solution would be to simply sus- The Administrative Board would appoint
pend the prohibition on central bank financing three separate committees from its body to
of the executive temporarily invoking constitu- oversee planning, procurement, and imple-
tional economic emergency provisions. mentation, respectively. The Planning Com-
Once the BCV board is given access to the mittee would set the program’s priorities, draft
funds, the Oil for Venezuela Foundation pro- the multi-year and annual budgets, and plan
poses that the parts set up an Administrative for loan repayments by interacting with other
Board tasked with managing and overseeing the relevant institutions in the public sector. The
humanitarian program in question. This board Procurement Committee would identify the
would be composed by an equal number of ap- program’s specific needs in terms of purchases
pointees from each side, in addition to one or of goods and services, but the actual selection
more non-aligned members representing the of providers would be assigned to independent
tie-breaking vote. In contrast to the BCV board international agencies to avoid some of the
appointments, there is no legal or constitution- pitfalls identified in Chapter 3 in the context
al restriction on their nationality, making it of Iraq’s Oil-for-Food Programme. The Imple-
possible for these tie-breaking votes to be repre- mentation Committee would design the specif-

THE OIL FOR VENEZUELA PROPOSAL
ic subprograms and coordinate their implemen- ing to the IMF’s World Economic Outlook Da-
tation with the specific implementing agency tabase, nominal per capita GDP in current USD
or entity, deciding on how a particular goal can rose by 121% between 2020 and 2022, mostly
be better achieved. In this regard, the distribu- driven by a strong appreciation of the real ex-
tion would be a combination of public channels change rate. If we redo the proposed calculations
(e.g., hospitals) and private channels. of Oil for Venezuela, we would estimate a per
In cases where distribution through private capita GNI of USD 2,816 by the end of 2022.
channels is deemed optimal, the goods could be While this figure lies significantly above IDA’s
sold to the private sector and the proceeds of the USD 1,255 cutoff reference, the Oil for Venezu-
sale could fund a voucher program to subsidize ela proposal underscores that this figure is not a
their acquisition by households. This would hard threshold as some small economies which
ameliorate concerns about the partisan alloca- exceed it have been included in the IDA cate-
tion of the benefits, which has been a recurrent gory. Venezuela’s exceptional conditions would
criticism within Venezuela since the voucher re- make the country a good candidate for excep-
cipient list could be easily auditable. In its pro- tional access to concessional financing. Further-
posal, the foundation also considers the possi- more, to the extent that the current level of the
bility of implementing direct cash transfers but real exchange rate is not sustainable, it is likely
notes that the infrastructure to distribute and that it would correct in the near future and bring
assign them would probably be lacking. Venezuela back closer to the threshold.
A secondary idea found in the proposal is The work also goes in-depth on the obstacles
that Venezuela could seek eligibility for con- to the approval of an RFI. As noted, the facil-
cessional International Development Associ- ity does not require the country to have a full-
ation financing. Eligibility for IDA financing fledged economic program nor strong econom-
depends on a country’s relative poverty, as mea- ic fundamentals, or a solid policy framework.
sured by its GNI per capita, which must fall be- However, there are significant requirements
low a threshold currently set at USD 1,255.321 that need to be met.
Venezuela has not reported GNI figures since First, the country must commit to “cooper-
2014, but the authors take that year’s GNI-to- ate with the Fund in an effort to find, where ap-
GDP ratio of 81.4% and apply it to their esti- propriate, solutions for its balance of payments
mate of Venezuela’s per capita GDP by 2022. difficulties.”322 The requesting member must
At the time of publication, the authors estimat- send a letter describing the general policies it
ed the GNI per capita would fall to USD 1,257 plans to implement to tackle its balance of pay-
by the end of 2022. ments difficulties, “including its intention not
However, nominal GDP growth estimates to introduce or intensify exchange and trade
have increased significantly since then. Accord- restrictions and other measures or policies that

would compound these difficulties.”323 Addi- thereby argue that Venezuela could include in
tionally, the member state has to commit to units letter of intent a commitment by the parts
dergoing a safeguards assessment, provide staff of its political conflict to cooperate on a plan
with access to its central bank’s most recently to regain access to its full pre-sanctions market
completed external audit reports and authorize quota as a consequence of sanctions.
its external auditors to hold discussions with The approval of an RFI also requires a
Fund staff. commitment to undergo a safeguards assess-
The authors don’t believe the threat of trade ment, whose timeline is determined on a case-
or exchange restrictions would prevent the ap- by-case basis and is a precondition for subse-
proval of an RFI. They also presume that the quent requests. The safeguards assessment is a
central bank continues to submit its financial diagnostic review of a central bank’s governance
statements for an external audit, even if it keeps and control framework,324 including the quali-
the resulting reports confidential. The most ty of its external and internal audit mechanism,
significant hurdle would be that relating to the the bank’s legal structure and autonomy, the
capacity to repay the loan and how to address standards for financial reporting, and the sys-
the balance-of-payments crisis. It is unclear tem of internal controls.
if a viable short-term solution can be given to Finally, there is the matter of the sustain-
this problem, particularly since Venezuela’s ability of Venezuela’s debt. A country’s debt is
balance-of-payments crisis is a long-term phe- regarded as sustainable if the government can
nomenon associated with the decline in oil pro- service its debt over time in the absence of ad-
duction, which is itself at least partially a con- justment or after carrying out a reasonable ad-
sequence of the exclusion from U.S. oil markets. justment.325 Venezuela’s debt is currently in de-
However, there is nothing in the rules for fault and deemed unsustainable. However, the
accessing the RFI that requires a certainty that paper argues that the agreement could stipulate
these efforts at resolving balance-of-payments that the parts will work together to restructure
constraints will be successful. The authors Venezuela’s debt to make it sustainable.
General Discussion
The Oil-for-Venezuela proposal was conceived at significantly since. While the general outline of the
a time in which Venezuela faced an urgent health proposal remains useful, we believe at this point in-
crisis provoked by the Covid-19 pandemic, which frastructure investment would offer a more impact-
was accentuated by the associated shock to external ful target for a cooperative humanitarian program.
revenues caused by the collapse of oil prices. Ven- The CAF/UNDP agreement for investment
ezuela’s macroeconomic conditions have changed in the rehabilitation of the electricity generation

GENERAL DISCUSSION
infrastructure also offers a possible blueprint going la’s thermoelectric plants use Siemens technology,
forward. Objections raised by some specialists at the with the other half using that of General Electric.327
time of its proposal should be assessed technically Nevertheless, there haven’t been any further pub-
and should be addressed, to the extent that they licly-disclosed developments on the initiative to
are found to be valid, through the appropriate contract Siemens. However, the idea is potentially
surveillance mechanisms. Perhaps the key lesson valuable and could benefit from a cooperative ap-
from the episode is that the success of humanitarian proach that helps prevent the misuse of funds and
efforts requires a broad process of consultations guarantees adequate surveillance.
that incorporates a wide range of stakeholders, A critical issue is that of political attribution
both from political sectors and civil society. It is of the benefits in welfare generated by a potential
also critical to put transparency at the forefront of humanitarian program. Conflicts on attribution
the initiative to insulate it from potential technical of gains lie at the center of many instances of
and politically motivated objections. controversy and confrontation in past experiences.
While U.S. sanctions remain in place, licensing To fix ideas, let us suppose that the mobilization of
agreements to allow foreign companies to operate resources helps address an aspect of the humanitarian
in Venezuela without fear of secondary sanctions are emergency. The improvement in living standards
also critical. Per news reports that emerged in late could be expected to lead to an improvement in
2022, the Maduro administration was negotiating Maduro’s popularity, strengthening his prospects
an agreement with Siemens Energy AG to repair for winning future elections or otherwise solidifying
power plants in the country.326 A license granted by his political standing. If this is so, the opposition is
the U.S. Treasury Department in June 2022 allowed likely to conclude that entering into the deal is a poor
the company to conduct repairs in thermoelectric choice. This reasoning may explain the opposition-
plants in the Miranda state for Venezuelan state- controlled National Assembly’s decision to shelve
owned energy company Corpoelec but restricted the CAF/UNDP initiative to repair the country’s
it from participating in plans to increase power electricity infrastructure in December 2019,
generation. Another license, for which the issuance despite agreement from the government.
date is undisclosed, allowed Siemens to sell and This problem has likely become less of an obstacle
repair power plant components for PDVSA-owned as the balance of power inside the opposition
power plants. The repairs could increase power coalition has shifted in favor of humanitarian
generation for the capital by 1,000 megawatts. solutions and away from maximalist claims to
This decision has a potentially significant impact unseat Maduro. However, any initiatives need to be
for the Venezuelan economy, as it allows Siemens designed to ensure that the benefits of the program
to provide services and equipment to rehabilitate are seen as a cooperative effort rather than as a
Venezuela’s electricity system without being subject political win for either side.
to secondary sanctions. Roughly half of Venezue-

Decentralized Boards
A possible solution to ensure that the benefits position, and the civil society to cooperatively use
of programs enabled through cooperative agree- the multi-stakeholder structure to handle resources
ments – whether they are funded from multilateral frozen abroad and funnel them into humanitarian
sources, use of assets or oil-for-essentials initiatives projects.
– are perceived as a joint effort is to manage funds The advantage of leveraging this council and its
through a decentralized board with representatives fund is that Venezuela already has the required legal
from all sectors of Venezuelan society. Such a figure framework to action on a proposal to enable fro-
exists in Venezuelan law. The constitutionally-es- zen resources abroad to attend to its humanitarian
tablished Federal Council of Government (Con- needs. However, there would be risks in granting
sejo Federal de Gobierno) has the mandate to de- the federal council the complete power to oversee
centralize the national government’s control over the distribution of funds. Currently, the ruling
the budget and is formed by representatives of civil party controls 19 of 23 governorships and 212 of
society and of all the branches of power, including 335 mayoralties. Further, as established in the law,
the vice president, ministers, governors, and may- the president has complete authority over the allo-
ors. Such an organization could theoretically incor- cation of funding to the Interterritorial Compen-
porate a diverse array of political and non-political sation Fund and the executive management of the
stakeholders in the decision-making process. council. Theoretically, the balance of power in the
The Federal Council of Government is defined federal council could change depending on the re-
in the Organic Law of Popular and Public Planning sults of the upcoming 2025 regional elections. On
as the “body in charge of planning and coordinat- the other hand, past experience suggests that the
ing policies and actions for the development of the government could try to use its control over other
decentralization process and transfer of powers institutions to move resources out of the purview of
from the National Power to the states and munici- institutions over which it loses control.
palities.”328 The council oversees spending from the One possible avenue would be to negotiate a
Interterritorial Compensation Fund, established governance structure for the federal council and
with the purpose of funding public investments Interterritorial Compensation Fund that ensures
that foster balanced development across regions. its technical management and establishes superma-
The federal council is formed of two entities: an jority requirements that impede the majority party
assembly and a secretary, which are in charge of ap- from redirecting the control over its resources or
proving and managing the interterritorial fund, re- loosening accountability. These rules could be es-
spectively. As per its definition in the law, the feder- tablished as part of a reform of the Organic Law
al council could allow the Maduro administration, of Popular and Public Planning resulting from a
the mainstream opposition, other sectors of the op- broader process of negotiation.

Recommendations
As we have shown throughout this chapter, the Once this agreement is reached, mobilizing
problems generated by the Venezuelan authorities’ Venezuela’s external wealth and multilateral fi-
legitimacy crisis have prevented the country from nancing will require a comprehensive assessment
mobilizing available resources to attend the human- of the available and potentially available funds
itarian crisis. In our view the best way to tackle this and the design a mechanism to shield them from
problem is by the formation of instances in which legal actions by the country’s creditors. Since in-
the Maduro administration can cooperate with the formation on existing liquid funds held in for-
local opposition and other key stakeholders for the eign accounts is likely to be more readily avail-
benefit of Venezuelans. able, these should be counted and consolidated
However, it is paramount that the process of dis- in a first step. However, engagement with multi-
bursing funds be done in a way that prevents slippage lateral development bank must happen in paral-
to corruption and use to the political advantage of lel, both to procure their technical assistance and
either side. The main elements in the Oil for Vene- to set in motion the necessary procedures that
zuela proposal provide a solid foundation for to this are required to approve and disburse financing
end. The core of the proposal involves the formation for the country. Regarding the shielding of funds
of consensus governing instances to represent key from creditor action, we believe that the Afghan
institutions, such as the central bank and PDVSA experience provides a possible template to create
abroad, that would enable access to their resources a trust established in a foreign country that has
by dissipating uncertainty over their legal capacity strong protection for sovereign and central bank
to use them. The agreement to appoint these in- funds in place.
stances must be born out of a political negotiation The allocation of resources should carefully
that establishes ex-ante clearly designed planning, consider both the short-term potential to allevi-
implementation and oversight mechanisms to gov- ate the suffering of some of the most vulnerable
ern the disbursement of funds, the procurement of segments of the population, as well as investment
humanitarian supplies and distribution of benefits. to rehabilitate key infrastructure for the provi-
These mechanisms must incorporate oversight and sion of utilities that directly impacts humanitar-
technical cooperation capabilities of international ian outcomes and also enables economic growth
institutions at the center of their design. and development more broadly.

Endnotes
182
Asamblea Nacional (2019a).
183
Acuerdo para la autorización de ingreso al país de la ayuda humanitaria (2019).
184
Oil For Venezuela (2020).
185
Jiménez v. Palacios (2019), Rodolfo Enrique Jiménez et al. v. Luisa Palacios et al. (2019), Banco Central
de Venezuela v. Juan Guaidó (2019), Petróleos de Venezuela S.A. v. Juan Guaidó (2019a), Petróleos de Vene-
zuela S. A. v. Juan Guaidó (2019b), Republic of Venezuela v. Juan Guaidó (2019).
The 15 countries that by the end of 2020 fully recognized the Guaidó government were Albania, An-
186
dorra, Argentina, Brazil, Canada, Colombia, Costa Rica, Guatemala, Honduras, Israel, Montenegro, North
Macedonia, Paraguay, Peru, and the United States. By the end of 2022, the list was reduced to only Brazil,
Canada, Costa Rica, Guatemala, Paraguay, and the United States.
187
Wong (2019).
188
Cohen, Parraga and Stempel (2019).
189
Granados (2023), Leon (2023), Rodríguez (2023).
190
Cohen, Parraga and Stempel (2019).
191
Voz de América (2023).
192
Hernández (2023).
193
Efecto Cocuyo (2023).
194
Itriago (2023).
195
Thomas (2021).
196
197
Thomas (2021).
198
Brookings (2022).
199
VOA News (2021).
200
Schaeffer (2022).
201
Fiona Havlish, individually and on behalf of the Estate of Donald G. Havlish, Jr., Deceased, et al., v THE
202
TALIBAN, et al. (2001).

203
204
General License 18 allows transactions and activities required by the official business of explicitly men-

tioned international organizations, but only for “effecting the payment of taxes, fees, or import duties, or the
purchase or receipt of permits, licenses, or public utility services.”
205
Executive Order No. 14064 (2022). Humanitarian exceptions of this kind often prove ineffective due to
the phenomenon known as de-risking or overcompliance in which financial institutions choose not to make
use of humanitarian exceptions given the increased costs of verifying that transacting parties are not proxies
for designated entities. See Crystal (2023), OCHA (2020) and The Carter Center (2020).
206
Sak (2022).
207
Byrd (2022a).
208
Byrd (2022a) and Byrd (2022b).
209
Qazi (2022).
210
Dawi (2022).
211
Fund for the Afghan People (2023a) and Fund for the Afghan People (2023b)
212
News desk (2022), Swissinfo (2022) and Byrd (2022b).
213
Hardie (2020).
214
Schiller Institute (2021).
215
Fund for the Afghan People (n.d)
216
Qazi (2022).
217
U. S. Department of the Treasury (2022a).
218
Section 25B. Act 12 USC 632 (1993).
219
Reuters (2022a).
220
Reuters (2022a).
221
Ackerman (2022).
222
Greenfield and Landay (2022).
223
Ackerman (2022).
224
Executive Intelligence Review (n.d).
225
ToloNews (2022).
226
Executive Intelligence Review (n.d).
227
Qazi (2022) and Fund for the Afghan People (n.d).
228
Da Afghanistan Bank (n.d).
229
Fund for the Afghan People (n.d).
230
Joya (2022).
231
Byrd (2022a).
232
Runrun.es (2022)

233
Banco Central de Venezuela ad hoc (2023).
234
Banco Central de Venezuela ad hoc (2023).
235
Croft and Long (2020).
236
Deutsche Bank v. Venezuelan Central Bank (BCV) (2020a).
237
Deutsche Bank v. Venezuelan Central Bank (BCV) (2020b).
238
Deutsche Bank v. Venezuelan Central Bank (BCV) (2021).
239
Deutsche Bank v. Venezuelan Central Bank (BCV) (2022a).
240
Deutsche Bank v. Venezuelan Central Bank (BCV) (2022b).
241
Deutsche Bank v. Venezuelan Central Bank (BCV) (2021).
242
Technically, “When the IMF allocates SDRs, participants in the SDR Department receive uncondition-
al liquidity represented by an interest-bearing reserve asset (SDR holding ) and a corresponding long-term
liability to the SDR Department (SDR allocation) […] The SDR Department pays interest on SDR holdings
to each member and levies charges on SDR allocations of each member at the same rate.” This accounting
formula means that “Countries that exchange their SDRs for currency will incur net charges on the dif-
ference between their cumulative SDR allocations and their SDR holdings.” See International Monetary
Fund. (n.d.f ). The SDR rate is based on the interest rate of the currencies belonging to the SDR basket and
currently sits at 4%. See International Monetary Fund. (n.d.g ). While the current rate is significant, over the
past decade the rate averaged a much lower 0.6%. Additionally, the use of SDR holdings has no conventional
“maturity” (i.e., countries are not required to repay them, just to pay the associated interest on the difference
between their current holdings and cumulative allocations). Due to their lack of maturity, historically low
interest rate and ease of access in regular circumstances, we include Venezuela’s SDR holdings in our liquid
asset estimate, instead of in our potential financing estimate.
243
International Monetary Fund (2021).
244
CITGO (2023).
245
Dorante (2021).
246
TotalEnergies (2021).
247
Stansell v. Revolutionary Armed Forces of Colom. (2022), Caballero v. Fuerzas Armadas Revolucionarias
de Colom. (2022) and Pescatore v. Pineda (2018).
248
Simoes (2019).
249
Donn (2022).
250
Bracci (2021).
251
Venezuela Solidarity Campaign (2020).
252
Puerta et al. (2023).
253
International Monetary Fund (n.d.a).
254

255
International Monetary Fund (n.d.b).
256
International Monetary Fund (2023b)
257
International Monetary Fund (n.d.c).
258
International Monetary Fund (n.d.d).
259
International Monetary Fund (n.d.d).
260
Ojeda (2020).
261
Laya and Vasquez (2020).
262
Vasquez, Bernstein and Zerpa (2020).
263
Reuters Staff (2020).
264
Itriago and Laya (2022).
265
Gold (1974).
266
267
International Monetary Fund (2020b).
268
The IBRD’s net loans outstanding as of June 2022 stood at USD 227 bn and IDA’s at USD 175 bn.
Argentina, Colombia, Costa Rica, Dominican Republic, Ecuador, El Salvador, Guatemala, Nicaragua,
269
Panama, Paraguay and Peru.

270
Campos and Lawder (2019).
271
The World Bank (2013).
272
Inter-American Development Bank (n.d.a).
273
Inter-American Development Bank. (2022).
274
Inter-American Development Bank (n.d.b).
275
Inter-American Development Bank (2021).
276
Inter-American Development Bank (n.d.c).
277
Inter-American Development Bank (n.d.d).
278
Inter-American Development Bank (n.d.e).
279
Inter-American Development Bank (n.d.f ).
280
As measured in the World Bank’s World Development Indicators.
281
Inter-American Development Bank (n.d.g ).
282
Inter-American Development Bank (2021a).
283
Wroughton and Rampton (2019).
284
CAF - Development Bank of Latin America (2020).
285
Mendoza (2015).

286
Reuters (2018).
287
Redacción Internacional (2019).
288
Deloitte (n.d).
289
Fitch Ratings (2022a).
290
CAF - Development Bank of Latin America (2023).
291
Alvarado (2020).
292
Petroguía (2023).
Note that as the country experienced a nationwide blackout that lasted at least three days in March 2019.
293
See Ellsworth et al. (2019).

294
Sequera and Ellswroth (2020)
295
OCHA (2023).
296
Los #Sinluz (2022).
297
Monitor ProDaVinci (2019).
298
TalCual (2021).
299
TalCual (2021).
300
Rodríguez and Rodríguez (2019).
301
Observatorio Venezolano de Servicios Públicos (2023b).
302
Singer (2021).
303
Observatorio Venezolano de Servicios Públicos (2022).
304
Observatorio Venezolano de Servicios Públicos (2023a).
305
Observatorio Venezolano de Servicios Públicos (2023a).
306
307
Los #Sinluz (2019).
308
PROVEA (2022)
309
Grupo de Boston (2019).
310
The targeted regions were the western state of Zulia, the South-Western region of the country, the State
of Nueva Esparta and the capital city of Caracas.
311
Los #Sinluz (2018).
312
Asamblea Nacional (2019b).
313
Figueroa (2019b).
314
Transparencia Venezuela (n.d.) and Punto De Corte (2019).
315
Prensa AN (2019b).

316
Prensa AN (2019a).
317
Figueroa (2019b).
318
Oil For Venezuela (2021).
319
Per Article 7 of the 2015 Venezuelan Central Bank (BCV) Law.
320
Quintero (2020).
321
International Development Association (2023).
322
323
324
International Monetary Fund staff. (2020a).
325
Zettelmeyer and Sturzenegger (2006).
326
Zerpa (2022c).
327
Zerpa (2022c).
328
Per Article 11 of the 2010 Organic Law of Popular and Public Planning.

Chapter 5
Asset Protection
A major medium-to-long term challenge to creditors, such as the Canadian mining company
Venezuela’s recovery is that related to the pro- Crystallex and the US oil company ConocoPhil-
tection of the country’s state-owned foreign as- lips, as well as commercial creditors in possession
sets. The country’s recovery from the economic of the country’s dollar-denominated Eurobonds.
and humanitarian catastrophe of the last decade The true extent of Venezuela’s debt is not com-
will demand significant investment in the reha- pletely certain, but we estimate it at USD 154 bn
bilitating of decaying infrastructure and in the (135% of GDP).329
protection of the most vulnerable segments of Compounding this issue, some creditors have
the population. By all accounts, this will be a already undertaken legal action to recover from
daunting enterprise and would become signifi- the country’s external assets and, in some cases,
cantly more difficult if the country loses an im- have been successful in seizing Venezuelan gov-
portant share of its external wealth. ernment property. The 2017 and 2019 economic
Venezuela has been left exposed to substantial sanctions have to a large degree prevented credi-
litigation in foreign jurisdictions due to the pro- tors from taking over Venezuelan assets in the U.S.,
longed default on its external debt and past na- but this protection has not been fully extended to
tionalizations. Major claimants include litigation other jurisdictions and, even in the U.S., litigation
ASSET PROTECTION 157

efforts have proceeded to a point that is likely to try far exceeds its available external assets, not
be irreversible without an effort to negotiate with all claims are equally likely to result in the loss of
claimants. A successful medium-term strategy assets and not all assets are equally susceptible to
would require the Maduro government and the being seized. As a general principle, central bank
2015AN to act cooperatively to ensure that a deal holdings, including international reserves, are
to suspend attachment efforts is viewed as eco- protected by the principle of sovereign immuni-
nomically and legally sustainable by creditors. ty, as are other fixed assets such as embassy real
We estimate the value of Venezuela’s exter- estate. However, assets employed for commercial
nal assets at USD 22.1 bn. This includes public purposes, including those belonging to PDVSA,
companies based in foreign jurisdictions, such as are exposed to creditor litigation. Since the oil in-
U.S.-based refinery CITGO and Colombia-based dustry generates almost 90% of the country’s ex-
fertilizers producer Monómeros, as well as size- ports, protecting oil sale receivables from creditor
able bank accounts to the name of the country’s attachment will be crucial.
central bank and several subsidiaries of Venezue- In this chapter we put into perspective the
la’s National Oil Company, PDVSA. In addition risks associated with foreign litigation, review
to existing asset stocks, the country also generates the state of legal action against the country’s
significant foreign-currency inflows arising from government and propose ways in which the
the operation of its oil industry. We estimate that parties to the Venezuelan conflict can put aside
Venezuela’s oil exports were of USD 20.8 bn in their differences to formulate a cooperative
2022 and that the inflows will rise to USD 22.6 bn strategy to protect the country’s external wealth.
in 2023 as U.S. restrictions on the import of Ven- We also review risks to PDVSA’s U.S. subsidiary,
ezuela oil are relaxed, which means humanitarian CITGO, which is subject to a court action in
efforts to alleviate the crisis must account for their which certain creditors have sought to auction
protection from aggressive creditors. off the company to recover unpaid debts from
While the size of the claims against the coun- PDVSA and the Venezuelan government.
The Framework and Implications of Sovereign Immunity
Under normal conditions, sovereign creditors or legally barred from permitting creditors to
have only limited recourse to a debtor’s assets seize them. 330
when the latter defaults on its debt. A first li- A second limitation comes from the principle of
mitation is that sovereign states usually hold sovereign immunity.331 Generally speaking, a sover-
the vast majority of their assets within their eign entity’s assets cannot be seized by creditors. An
own territory, where courts are often reluctant exception to this rule exists whenever the sovereign

THE FRAMEWORK AND IMPLICATIONS OF SOVEREIGN IMMUNITY
engages in commercial activities abroad, in which of terrorism.” The safeguards afforded by continental
case it cannot invoke immunity from the jurisdiction European jurisdictions are more varied, but also pro-
where the transactions occur. In addition to this gen- vide strong protection to central bank assets.
eral exception, most modern debt contracts include The implication of these exemptions for Venezuela
sovereign immunity waivers that establish consent is that central bank assets can be presumed to be
to subject disputes to the authority of courts of some immune from execution by creditors but the assets
foreign jurisdiction, most often U.S. or UK courts. of government-owned corporations, such as PDVSA
Modern states also commonly sign bilateral invest- and its subsidiaries, are generally more vulnerable.
ment treaties that include arbitration clauses, which Since most of the external flows generated by the
allow recourse to dispute resolution by international country pertain to activities undertaken by PDVSA,
arbitration courts, such as the International Centre for and not directly by the Republic, this institutional
Settlement of Investment Disputes.332 framework leaves the Venezuelan public sector under
Within the U.S., sovereign immunity and its ex- considerable exposure to foreign litigation.
ceptions are primarily ruled by the Foreign Sovereign Nevertheless, there is an important barrier that
Immunities Act (FSIA). The act stipulates several ex- protects PDVSA assets from creditors of the Repub-
ceptions to sovereign immunity, the most important lic. Most modern legal systems accord an important
of which come into play if the state has waived such place to the principle of limited liability, which im-
immunity, employed the property in commercial ac- plies that a creditor cannot collect on the debt of a
tivities related to the claim or the judgement is based person or company by attaching the assets of a sub-
on an order confirming an arbitral award.333 sidiary because the subsidiary is legally independent
However, central bank assets are generally afforded from the owner. This means that a creditor can pur-
an even greater degree of protection than other sover- sue the assets that the debtor directly owns, includ-
eign assets. Some of the most relevant jurisdictions in ing the shares of a company held by it, but not the
this regard – including the U.S. and UK – offer almost assets of that company itself.
absolute immunity to the assets of foreign central In our case, this implies that creditors of the Repub-
banks.334 For instance, UK law has an exception to the lic could, theoretically, try to attach the government’s
general principle of sovereign immunity that applies shares in PDVSA but not assets belonging to its var-
to sovereign assets employed for commercial purpos- ious subsidiaries. However, PDVSA is a corporation
es, but explicitly carves out central bank assets from incorporated in Venezuela and thus any efforts to at-
this exception.335 The U.S. similarly protects central tach its shares would have to take place in Venezuelan
bank assets “held for its own account,” but provides ex- courts that would be legally barred from complying
ceptions for cases involving i) the government or cen- and politically inclined to resist.336 However, PDVSA
tral bank waiving such immunity and ii) certain cases owns a U.S.-based subsidiary, CITGO, dedicat-
related to victims of terrorism seeking to attach assets ed to the refining and marketing of oil products,
belonging to a country designated as a “state sponsor which has been the main focus of creditor attempts

at attaching Venezuelan assets. mination, also known as piercing the corporate veil,
In principle, PDVSA creditors are able to seek requires a high burden of proof to establish that the
the attachment of CITGO, but creditors of the Re- firm in question is being used as an instrumentali-
public are prevented from doing so by the princi- ty of the owner (in this case, the Republic). In the
ple of limited liability. However, this barrier is not following years, other creditors used this argument
impenetrable and has been breached in some cases to also further their attempts at collection against
through a legal doctrine called alter ego, which has the country.
played a significant role in litigation against Vene- In theory, this problem could have been solved
zuela in the last few years. The concept, also known when the Guaidó administration assumed control
as “piercing the corporate veil,” allows a court to of PDVSA, as U.S. courts have found that the rele-
ignore the legal separation of the entities when it vant period for alter ego determinations is the time
deems the subsidiary to be an instrumentality of its between the moment at which the request for a
owner.337 In a sovereign context, an alter ego deter- writ is introduced and the moment at which it is
mination requires a high burden of proof involving granted, which means that creditors can be pre-
the claimant proving that i) the foreign state exerts vented from piercing the corporate veil if the entity
extensive control over the entity in question, or that exercising the representation of the government of
(ii) maintaining the presumption of separateness Venezuela in the U.S. does not exert undue control
would enable “fraud or injustice.” It is important to over PDVSA, regardless of how any previous ad-
note that alter ego determinations must be proven ministration acted.
on a case-by-case basis, which means that a deci- The Guaidó administration claimed to have
sion in favor of one creditor does not automatical- substantively altered its management of PDVSA
ly translate to a similar determination for another in order to reassert its independence, a contention
similarly situated one. that gained the support of the U.S. government.
As we develop in further detail in the follow- However, a March 2023 judicial decision found
ing sections, alter ego allegations have allowed a that both the Maduro and Guaidó administrations
significant number of Venezuela creditors to seek had treated PDVSA as their instrumentality and
execution of CITGO for their benefit. The trend granted conditional writs of attachment on CITGO
began in 2018, when Judge Leonard Stark of the to a number of creditors with judgement against
Delaware District Court granted Crystallex, a Ca- Venezuela.338 The decision was crucial because it
nadian mining company in possession of an arbitral means that the Guaidó administration’s contention
judgement against Venezuela, a writ of attachment of having substantively altered its management
on PDV Holding shares. The judge’s decision in the of PDVSA has been rejected by the court, which
Crystallex case was based on the determination that greatly facilitates efforts by other creditors to also
PDVSA was an alter ego of the Republic and, there- obtain writs of attachment against CITGO.
fore, not protected by the FSIA. An alter ego deter- Later in this chapter, we summarize the grounds

THE FRAMEWORK AND IMPLICATIONS OF SOVEREIGN IMMUNITY
on which the court reached this conclusion and sug- sary transactions to carry out all the necessary steps
gest ways in which PDVSA’s governance framework required for the holding of a CITGO auction. In
must be modified to protect its foreign assets. The a letter addressed to the court, the Department of
relevance to our argument, developed later in this Justice said the U.S. intended to “implement a fa-
chapter, is the implication that one key area for co- vorable licensing policy for license applications in
operation between the Maduro government and the connection with the execution of a sale as contem-
opposition is in developing a governance framework plated in the Sales Order or, as applicable, the nego-
that minimizes the risk of future alter ego allegations. tiation of a settlement agreement among the rele-
Beyond these regular obstacles to creditor at- vant parties.”341 OFAC then issued General License
tachment of sovereign assets, Venezuela is currently 42, which allows creditors to carry out incidental
also under a sanctions regime that prevents most and necessary transactions to reach settlement
transfers of property, including for the purposes of agreements with the 2015AN.342
creditor relief. Executive Orders 13884 and 13850, These recent developments indicate that the U.S.
coupled with the subsequent designation of PDVSA government is unlikely to continue indefinitely
by OFAC on the SDN list, blocked most Venezue- protecting CITGO from creditors but also suggest
lan government property from being transferred or that the administration would favor a negotiated
attached by creditors.339 The orders provide that all solution between Venezuela and those creditors
properties of the Venezuelan State in the U.S. “are that have enforceable legal claim on its assets. It is
blocked and may not be transferred, paid, exported, important to note that the process initiated by the
withdrawn, or otherwise dealt in.” OFAC has sub- court to auction CITGO is ongoing and expected
sequently clarified that parties who have attached to be finalized in coming months, which means
shares of an entity of the Venezuelan state “must ob- that reaching a negotiated solution should be a pri-
tain a specific license from OFAC prior to conduct- ority for Venezuela.
ing an auction or other sale, including a contingent Finally, there is a distinct, but related, question of
auction or other sale, or taking other concrete steps determining who is legally permitted to manage as-
in furtherance of an auction or sale.”340 sets belonging to the Venezuelan public sector. As we
These restrictions on the transfer of Venezuelan discussed in previous chapters, the political conflict in
government properties have so far prevented the Venezuela degenerated into a dispute over the legiti-
loss of Venezuelan foreign assets in the U.S. but macy of the government led by Nicolás Maduro. The
have not fully prevented creditors from preparing Venezuelan opposition has long argued that the latter
for the hypothetical lifting of sanctions by taking should not be allowed to access or manage foreign as-
all the preliminary steps required for an eventual sets on account of a long track record of corruption.
auction of CITGO. On May 2023, OFAC notified This is not to say that the opposition’s management of
the court that the U.S. will not seek to enforce sanc- those assets under its stewardship has been pristine, as
tions against entities or creditors engaging in neces- the controversy surrounding Monómeros shows.343

Generally speaking, the decision of which per- In the previous chapter we also discussed the
sons and entities are allowed to manage a foreign state of affairs regarding the control of existing
government’s assets derives from the decisions by Venezuelan liquid assets. While we do not dupli-
the executive branch in the jurisdiction where cate that discussion here, it is crucial to note one
these assets are located. As explained in greater important corollary of the issue of recognition,
detail in our discussion of the Afghan experience especially in foreign courts: the entity charged
presented in Chapter 4, the management of a for- with the protection and stewardship of Vene-
eign central bank’s assets held at the U.S. Feder- zuelan foreign assets varies with jurisdiction.
al Reserve is determined by an executive branch Furthermore, due to the unusual nature of the
certification of a given person’s authorization to current situation, any proposal involving negoti-
dispose of them. Where a legal conflict arises – for ations with creditors to suspend litigation, or the
instance, if two different entities claim ownership agreement of a mutually beneficial repayment
of an asset – courts defer to the executive’s deci- arrangement would provide little long-term cer-
sion on which, if any, to recognize as the legal- tainty to the creditors unless explicitly backed by
ly-authorized entity to dispose of said assets. both sides of the Venezuelan political conflict.
Venezuela’s External Assets
Despite being almost 6 years in default on its tachment including those that emanate from
external debt, the Venezuelan public sector sovereign immunity and corporate veil restri-
still has sizeable assets abroad. Broadly spea- ctions. External assets to the name of the cen-
king, these can be divided into three catego- tral government are mostly composed of the
ries: i) central bank assets, ii) central govern- Ministry of Finance’s ownership interest in
ment assets and iii) PDVSA assets. All-in-all, foreign banks in South America and Eastern
we estimate the value of Venezuelan public Europe held through BANDES, Venezuela’s
assets abroad at USD 22.1 bn, of which USD development bank. These assets are quanti-
11.6 bn consists of bank accounts and other tatively limited compared to the much larger
liquid or quasi-liquid assets (enumerated in values to the name of PDVSA and the central
more detail in the previous chapter) and USD bank.
10.5 bn in non-liquid assets (primarily Vene- On the non-liquid side, CITGO – PDVSA’s
zuela’s ownership interest in several offshore refining arm in the U.S.– is by far the most
corporations). relevant asset held by the Venezuelan public
As discussed above, each category enjoys sector. Publicly available analyst valuations
different levels of protection from creditor at- of CITGO as a going concern range between

USD 5.3 bn 344 and USD 13.4 bn. 345 In a tachment efforts, as we detail in our discussion
February 2023 conference, the president of of the Monómenos and Nynas AB cases.
PDVSA’s ad-hoc board designated by Guaidó, For the reasons further elaborated below,
Horacio Medina, said that the company’s value it is crucial to highlight the exact corporate
was in the USD 9-11 bn range. 346 We take the structure under which Venezuelan public as-
mid-point for the range of available analyst sets abroad are held. Formally, the company
estimates, USD 9.4 bn, as our baseline for in direct ownership of Venezuela’s oil refining
the company’s value but note that Medina’s and distribution assets in the U.S. is CITGO
declaration implies that the actual value of the Petroleum, which is owned by CITGO Hold-
company would likely be closer to the upper ing, which in turn is owned by PDV Holding.
bound, rather than to the lower bound. 347 All these entities are incorporated in Dela-
Unsurprisingly, the company has been the ware. It is PDV Holding that is owned by PD-
main target of creditor attachment efforts so far, VSA itself, which is a company incorporated
even if attempts to attach assets in other jurisdic- in Venezuela. As we further explain later in
tions have been more successful.348 Other corpo- this chapter, this corporate structure has a sig-
rations owned by the Venezuelan state abroad are nificant impact on creditor efforts to recover
much smaller and less valuable, although some from both PDVSA and Venezuelan govern-
have been the subject of intense controversies ment liabilities.
due to corruption allegations and creditor at- In addition to fixed assets and existing bank
Table 18. Estimated total value of offshore Venezuelan assets

Asset Value USD mn
Fixed assets 10,473
CITGO 9,350
PDVSA International 559
Monómeros 180
Banco Prodem 244
Evrofinance Mosnarbank 82
Bandes Uruguay 58
Liquid assets 11,601
PDVSA Joint Ventures 2,588
Special Drawing Rights (SDRs) at the IMF 4,768
Gold and proceeds of gold swaps held at the Bank of England 2,107
Account at the U.S. Federal Reserve 144
Novo Banco 1,667
Other assorted bank deposits 327
Total Value 22,074

Figure 11: PDVSA organization chart
Source. PDVSA.
accounts, PDVSA exported an average 583 tbd to around 709 tbd (USD 26.3 bn) in 2023, the
per month in 2022, valued at USD 21.9 bn. As monetary flows generated by PDVSA oil trade
the authorization of Chevron’s operations in the could become a new target of attachment efforts.
country enables a recovery of exports to the U.S.
Venezuela’s External Liabilities

Venezuelan external public debt more than qua- corresponds to 1Q2019 and places Venezue-
drupled between 2004 and 2014, going from la’s external public debt at USD 129 bn. We
USD 28 bn to USD 117 bn in the space of 10 ye- believe that external public debt has contin-
ars. This tremendous rise came despite the coun- ued to grow due after the 2017 default, due
try enjoying the benefits of rising, high oil prices to mounting arrears on external bonds and
over the period. Public debt continued to grow other liabilities, as well as the accumulation
in the following years, but the pace of its nominal of arbitration awards against the country, and
growth fell considerably after the collapse of oil estimate that it reached USD 154 bn by the
prices in 2014 as the country lost access to finan- end of 2022.
cing in international financial markets. The available central bank data does not
The most recent central bank data release provide enough detail to distinguish between

Figure 12: Public external debt (USD bn)
Sources. Own calculations, BCV.
different types of debts beyond broad catego- Atypically for a middle-income country,
ries, and does not provide details such as debt Venezuela has a relatively small stock of bi-
terms, creditors, or the Venezuelan public en- lateral debt and negligible multilateral debt.
tities that are liable for their repayment. How- These two categories combined amount to
ever, our bottom-up partial reconstruction of just USD 21 bn (18% of the country’s total
the current stock of debt indicates that rough- public external debt), while USD-denomi-
ly 64% of Venezuelan public debt is owed by nated bonds issued by the Republic, PDVSA
the central government itself, while the other and other state-owned enterprises amount to a
36% is owed by state-owned enterprises (pri- much larger USD 67 bn (56% of the total). 349
marily PDVSA). As we discussed in previous Also atypically, Venezuela has over USD 23 bn
sections, this distinction is critical to evaluate (20% of the total) in debt created by arbitra-
the relative level of threat that each creditor tion awards against the country. As we show in
poses to Venezuelan public assets. Given the the following section, it is precisely this cred-
limited quantity of these and the protection itor class that represents the most significant
afforded by the main jurisdictions of interest threat to Venezuelan assets abroad.
on central bank assets, creditors seeking recov- Chinese oil-for-loan arrangements are one
ery from Venezuelan government entities have source of significant uncertainty around the
primarily – although not exclusively – concen- true extent of Venezuela’s debt. Between 2007
trated their efforts on attaching CITGO. and 2015, both governments entered into 8

Table 19: Partial identification of Venezuela’s current external public debt in 2022 (USD mn)
Central government % of GDP PDVSA % of GDP Total % of GDP
Bonds and promissory notes 36,768 31% 30,165 25% 66,934 56%
Principal 23,959 20% 21,545 18% 45,504 38%
PDI 12,809 11% 8,620 7% 21,429 18%
Bilateral 16,571 14% 0 0% 16,571 14%
China 13,131 11% 0 0% 13,131 11%
Russia 2,759 2% 0 0% 2,759 2%
Brazil 682 1% 0 0% 682 1%
Multilateral 4,524 4% 0 0% 4,524 4%
IDB 2,011 2% 0 0% 2,011 2%
CAF 2,513 2% 0 0% 2,513 2%
Arbitration awards 21,790 18% 1,405 1% 23,195 20%
Other debt 0 0% 12,966 11% 12,966 11%
Total external public debt 79,653 67% 44,536 37% 124,189 104%
Local holdings of bonds 18,763 16% 11,320 10% 30,082 25%
Principal 12,786 11% 8,055 7% 20,841 18%
PDI 5,977 5% 3,264 3% 9,241 8%
Total external public debt +
98,416 83% 55,856 47% 154,272 130%
local holdings of bonds
financing agreements for USD 50 bn. Unlike Venezuela was seeking a grace period on this
traditional financing agreements, these loans debt. 351 The concession was granted by the
entailed a commitment from Venezuela to de- Chinese government and the grace period
liver oil shipments to China, from which the elapsed in the first half of 2018. 352 At the time,
service on the loans would be subtracted. 350 Reuters reported the outstanding stock of the
The precise terms of these loans are not pub- oil-for-loan debt at USD 19 bn. Uncertainty
lic, but partial information on their expected increases at this point. While it is likely that
maturities, interest rate and amounts is avail- Venezuela resumed servicing the debt in the
able, which allows researchers to construct an second half of 2018, it is unclear if it continued
approximate debt service schedule. However, doing so in the aftermath of the imposition of
the approval of at least 2 grace periods on prin- US sanctions on the Venezuelan oil sector in
cipal payments and the possibility of Venezue- early 2019, which prompted a collapse in oil
la having gone into arrears or renegotiating the exports. An August 2020 report by local NGO
terms in ways other than grace periods compli- Transparencia Venezuela cited internal sources
cate a determination of the current stock. within the Venezuelan government placing the
In mid-2016, press reports revealed that outstanding debt at USD 17 bn by the end of

2019. 353 This figure would be consistent with oil minister said that the debt remained under
China having granted a grace period on the a grace period negotiated “years ago” to help
debt covering most of the period between Jun Venezuela stay afloat amid sanctions. 355
2018 and December 2019. To account for the large uncertainty sur-
Further news came in August 2020, when rounding arrears and the extent of grace periods
press reports revealed that Venezuela had suc- granted to Venezuela by the Chinese govern-
cessfully negotiated a grace period until the ment, we estimate the stock of Chinese debt un-
end of the year. 354 The starting date of this der two assumptions; i) that Venezuela received
period is unknown, and Reuters also reported grace periods continuously covering the whole
that Venezuela had been unable to service the of 2021 and 2022, in which case we place the
debt in full since 2019. Bloomberg’s tanker outstanding debt at USD 15 bn, and ii) that the
tracker data also indicates that Venezuela’s oil grace period covered only 2021, in which case
shipments to China decreased significantly in we place the outstanding at USD 11 bn. In both
the second half of 2020. We assume that Vene- cases, we assume that a combination of grace
zuela only partially served its oil-for-loan deals periods and arrears in 2019 and 2020 resulted
in the first half of 2020 and received a formal in only minimal repayment of principals. For
grace period on the second half of the year. the purpose of our bottom-up reconstruction
We also assume that this grace period was ex- of Venezuela’s public external debt, we take the
tended into 2021. In July 2023, a Venezuelan midpoint of our two scenarios (USD 13 bn).
Creditor Efforts to Attach Venezuelan External Assets
As the preceding two sections show, the size of Ve- tors has attempted to recover on their claims through
nezuela’s total external liabilities (USD 154 bn) litigation and the principles of the corporate veil and
far exceeds the value of its assets (USD 22 bn). sovereign immunity have kept most claimants distant
However, as we noted previously, recovery against from Venezuela’s main assets, some have persisted in
a sovereign state or state-owned enterprises is often multi-year legal efforts and progressed significantly
a complicated matter, particularly since most of a in their efforts. In the next few pages, we highlight
country’s public assets are located within its own the most significant and urgent cases, which arise
territory and many of those held outside it are pro- from creditor efforts to seize CITGO.
tected by sovereign immunity. In this context, most The most important case in the CITGO saga
creditor efforts have unsurprisingly focused on sei- has undoubtedly been that of Crystallex Inter-
zing CITGO, the most valuable external asset of national. The company’s claim against Venezue-
the Venezuelan public sector. la stems from a 2011 seizure by the Las Cristinas
While only a small subset of the country’s credi- goldmines during the government of the late Hugo

Chávez. After the expropriation, Crystallex took The court then spent most of 2021 and 2022
its case to ICSID and obtained an award of USD revising the special master’s plan to auction the
1.2 bn plus interest in 2016.356 The judgment was shares (the “Sales Procedures”), as well as the par-
later confirmed by the United States District Court ties’ objections to the proposed process, until it set-
of the District of Columbia in 2017,357 after which tled on a final procedure in October 2022. At that
Crystallex proceeded to seek a writ of attachment time, Judge Stark also directed the special master to
on the shares of PDV Holding in a Delaware Dis- take a 6-month period, elapsing on April 2023, to
trict Court. The award has been partially satisfied seek guidance from OFAC on the authorization of
and we estimate its outstanding amount at USD the marketing process for the auction of the PDV
1.01 bn, inclusive of interest. Holding shares given the current state of sanctions.
The Delaware court accepted Crystallex’s conten- In April 2023, the special master entered a letter
tion that PDVSA was an alter ego of the Republic on from the U.S. Department of Justice into the court
the grounds the latter had shown extensive control docket stating that OFAC “[…] intends to imple-
over the former, including the use of company assets ment a favorable licensing policy for license appli-
for political objectives, the direct appointment of cations in connection with the execution of a sale
company executives, and the approval by the govern- as contemplated in the [Sale Procedures Order] or,
ment of ordinary business decisions of the company. as applicable, the negotiation of a settlement agree-
Venezuela then lost on appeal to the Third Circuit ment among the relevant parties.”361
Court of Appeals358 and the country’s request for the In May 2023, Judge Stark filed a memorandum
U.S. Supreme Court to hear the case was rejected.359 order to docket the materials his court received
In 2018, Crystallex was granted an uncondition- from OFAC as well as an exchange between the of-
al writ of attachment on the PDV Holding shares fice and the special master. Attached were several
and initiated a long effort to sell them to recover the emails between the special master and an unknown
amounts owed by Venezuela. person that reveal that the documents received
The Crystallex case came to a crucial point from OFAC include a specific license that gives
in 2021, when Judge Leonard Stark appointed a the court full control to add or exclude “Additional
special master to “devise a plan […] for the sale of Judgement Creditors.” This refers to other entities
shares of [PDV Holding] as necessary to satisfy the entitled to participate in the auction of PDV Hold-
outstanding judgment of Crystallex and the judg- ing shares and who will be authorized to participate
ment of any other judgment creditor added to the in the sale process under OFAC’s non-enforcement
sale by the Court […] while maximizing the sale policy, up to the point of sale. At that point, an ad-
price of any assets to be sold […].”360 Judge Stark’s ditional license will be required under OFAC’s ‘fa-
decision came despite the current inability to actu- vorable’ licensing process.”362
ally transfer the shares due to U.S. sanctions and the In addition, the memorandum order includes an-
U.S. executive’s opposition to the decision. other OFAC-issued license, which allows the court

CREDITOR EFFORTS TO ATTACH VENEZUELAN EXTERNAL ASSETS
to issue writs of attachment fieri facias for any par- affront to the United States judicial system. Those
ty appointed as an “Additional Judgment Creditor” days must soon come to an end.”365 This highlights
by the Court. The license, however, states that these a tension between competing objectives of the
parties would require the issuance of another specific United States. While the humanitarian crisis in
license to execute their writ of attachments.363 Venezuela certainly calls for solidarity from the in-
These developments significantly complicate ternational community that can in part justify the
CITGO’s situation, as the amount owed to credi- protection of its assets from creditors, the U.S. gov-
tors with writs or attachment or that have a strong ernment can be expected to weigh these consider-
likelihood of obtaining one in the short term has ations against the risk that restrictions on the exer-
risen from USD 4.8 bn at the end of 2022 to USD cise of property rights could undermine the United
10-20.3 bn as of June 2023, depending on the in- States’ privileged position as a key center of global
clusion (or exclusion) of a USD 10.2 bn Cono- finance and impair the interest of creditors, some of
coPhillips judgement against PDVSA. which are U.S.-based institutions.
The U.S. government has long asserted that its While Crystallex is the only judgement creditor
preference is for the creditors and the Venezuelan that has received an unconditional writ of attach-
government to reach a negotiated solution regard- ment on the PDV Holding shares so far, other cred-
ing these debts.364 However, at this point the com- itors are likely to obtain similar orders, particularly
munications delivered to the court indicate that the given that several have already received conditional
U.S. government would not prevent the transfer of writs of attachment. To be clear, conditional writs
the shares if an auction were concluded without a of attachment are issued conditionally on the pro-
negotiated agreement. This makes the matter of ne- spective holder being granted an OFAC license to
gotiating with the creditors of utmost urgency. attach shares on PDV Holding. Neither the holders
In principle, the auction process is designed to of full writs of attachment nor those of condition-
satisfy the judgment debts while maximizing the al writs of attachment are currently authorized to
value of the shares to be sold. Depending on how seize the shares without a license from OFAC.
the bidding process develops, this might result in In late March 2023, the District Court of Delaware
the sale of all PDV Holding shares or just a frac- granted conditional writs of attachment to four claim-
tion of these. However, it is highly unlikely that any ants in possession of judgements against Venezuela.
bidder would want to acquire a non-controlling in- These creditors were OI European Group BV, Hun-
terest in the company given that PDVSA is a state- tington Ingalls Incorporated, Rusoro Mining Ltd.,
owned company subject to significant political and and ACL1 Investments Ltd., and collectively hold
regulatory risk. USD 2.5 bn in judgements against Venezuela. The
Judge Stark notoriously wrote in one of his de- writs were issued under the justification that PDVSA
cisions that “Each day that Crystallex does not re- is liable as the alter ego of the Venezuelan government.
cover on its judgment is arguably something of an Prior to these companies demonstrating the al-

ter ego principle, Crystallex was the only claimant PDVSA (and not Venezuela), ConocoPhillips does
against Venezuela that had obtained a favorable rul- not require to prove an alter ego case to attach the
ing based on the alter ego concept, which enabled CITGO shares. ConocoPhillips also holds a much
them to obtain their writ of attachment in 2018. The smaller arbitration award against one of PDV-
fact that the judge recognized PDVSA as Venezue- SA’s subsidiaries in Venezuela, Venezuelan Cor-
la’s alter ego has serious implications for Venezuelan poration of Petroleum (Corporación Venezolana
litigation because it presents a precedent for other de Petróleo, CVP), for USD 48 mn plus interest,
companies like ConocoPhillips and the rest of the which the Southern District of New York Court
Venezuela creditors to receive a writ of attachment has confirmed. The District Court of Delaware
to seize CITGO. issued a writ of attachment fieri facias on the said
ConocoPhillips stands as the most important of smaller award in October 2022.366
these creditors due to the size of its claim, as well as A much larger ICSID case involves an arbitra-
its active participation in designing the auction pro- tion award of USD 8.5 bn, which was recognized by
cess. The company has two separate awards against U.S. District Judge for the District of Columbia Carl
Venezuelan government entities, both arising from Nichols in 2022. The Judge issued a default judg-
the expropriation by the Hugo Chávez administra- ment in August after Venezuela’s interim government
tion of the company’s interest in three oil projects lo- failed to present a defense despite being duly served.
cated the Orinoco Oil Belt. In 2007, the government ConocoPhillips registered the judgment in the Dis-
sought to modify the agreements governing those trict Court of Delaware on October 12, 2022, but
projects to impose a higher tax rate. While some for- the case was immediately closed for unknown rea-
eign companies accepted the government’s proposal sons. More recently, on August 1, 2023, the case
to convert their contracts, ConocoPhillips rejected was reopened, and ConocoPhillips filed a motion
it and initiated two arbitration claims as a response, requesting a writ of attachment under the USD 8.5
one against the government of Venezuela before the bn award. We estimate the value of this case at USD
ICSID and another against PDVSA before the In- 10.2 bn after considering the court-ordered interest
ternational Chamber of Commerce (ICC) tribunal. rates and other costs involved.
In 2018, ConocoPhillips won the ICC arbitra- Aside from the creditors described above, the
tion and received a USD 2 bn plus interest award most significant threat to Venezuela’s ownership of
against PDVSA, which has already been partially CITGO lies in the case of the PDVSA 8.5% 2020
satisfied. We estimate that the outstanding amount bonds. The bonds originated in a 2016 exchange
on the ICC award is currently USD 1.4 bn, inclu- operation performed by Venezuela’s national oil
sive of interest. After the judgement was confirmed company. At the time, the country was in a com-
by the Southern District of New York Court, Con- promised economic situation due to collapsing
ocoPhillips inserted itself as a party in the Crys- oil prices and was facing significant challenges in
tallex case. Since the ICC award is directly against repaying its external debt. Two of the company’s

external bonds were coming due in 2017 and PD- While PDVSA defaulted on most of its bonds
VSA proposed to exchange them into a new title in late 2017 and early 2018, the company remained
set to mature in 2020. Due to general lack of appe- current on the PDVSA 8.5% 2020 until late 2019
tite for its bonds in the primary market, PDVSA for fear of losing CITGO to the bondholders. On
offered 50.1% of its shares on CITGO Holding as October 2019, the PDVSA Ad Hoc Board ap-
collateral to make the issuance more attractive. As pointed by Juan Guaidó filed an action before the
noted in the section on Venezuela’s external assets, U.S. District Court of the Southern District of
CITGO Holding is a wholly owned subsidiary of New York seeking to declare the bond and its guar-
PDV Holding, which means that the PDVSA 8.5% antee invalid due to the lack of National Assembly
2020 claim over the actual refining assets is stronger authorization for its issuance.
than that of Crystallex and other creditors seeking One year later, the judge presiding the case ruled
attachment of PDV Holding shares. in favor of the bondholders, dismissing the Guaidó
Table 20: Venezuela’s and PDVSA’s debt to creditors legally entitled to seize assets of the latter in the U.S.
Creditor Outstanding debt (USD bn)
Creditors who own a first-priority lien 1.9
PDVSA 8.5% 2020 1.9
Creditors who have already obtained a writ of attachment 7.0
Crystallex 1.0
ConocoPhillips I 1.3
ConocoPhillips II 0.0
Red Tree Investments 0.3
Siemens Energy Inc. 0.2
OI European Group B.V. 0.7
Hungtinton Ingalls Inc. 0.1
ACL1 Investments 0.1
Rusoro Mining Ltd. 1.6
Gold Reserve Inc. 1.0
Koch Minerals and Nitrogen 0.5
Refinería di Korsou 0.1
Creditors who are requesting to attach their judgment to
1.2
CITGO’s parent company’s auction
Tidewater Investment and Caribe 0.1
Contrarian Capital 0.4
Valores Mundiales and Consorcio Andino 0.6
Banco San Juan Internacional 0.1
Creditors who could obtain a writ of attachment 10.2
ConocoPhillips III 10.2
Total Value 20.3
Source- Own elaboration.

CREDITOR EFFORTS TO ATTACH VENEZUELAN EXTERNAL ASSETS
administration’s arguments that Venezuelan law creditors have so far been far more aggressive in
should rule over the authorization of the issuance their legal actions against Venezuela than tradi-
and further noting that two 2015 National Assem- tional commercial creditors, including holders
bly declarations purportedly rejecting the issuance of the country’s Eurobonds. However, the vol-
do not apply to the bond. The Guaidó-appointed ume of litigation by these may rise significantly
PDVSA ad-hoc Board decided to appeal the case in the lead up to the last quarter of 2023. Most
and the appeal is ongoing. of the country’s commercial debt is issued under
By the time the Guaidó administration default- New York law, which features a statute of lim-
ed on the PDVSA 8.5% 2020 bond, half of its orig- itations of 6 years for commercial contracts.368
inal USD 3.4 bn principal had already been repaid. This means that creditors have a 6-year period,
However, the bond has continued to accrue inter- starting from the time a payment became due,
est while the dismissal trials proceed. We estimate to sue the debtor for its repayment. The differ-
that the total claim on the bond currently stands at ent Venezuelan public sector entities began de-
USD 1.9 bn. faulting on their Eurobonds in October 2017,
Beyond CITGO, ConocoPhillips has been which means the statute of limitations begins
partially successful in pursuing Venezuela going into effect in October 2023. If creditors
public sector assets in jurisdictions other than don’t exercise legal actions within this period,
the U.S. In 2018, the company began legal ac- they lose the right to do so.
tions in the Caribbean to enforce its USD 2 bn While the going into effect of the statute
ICC award by seizing PDVSA’s assets in Bo- of limitations doesn’t strictly mean that the
naire and Saint Eustatius, where the company debt is eliminated –a future government could
owned facilities for processing and storing oil still choose, and may be forced to, admit time-
for export. These efforts led PDVSA to sus- barred debt in a restructuring process– but
pend indefinitely oil storage and shipping in creditors are left with significantly reduced
its Caribbean facilities, shutdown a refinery means to enforce the contract. Given the duty
in Curacao and undertake other measures to of financial institutions to preserve the value
prevent the seizure of monetary flows derived of the funds they hold under administration,
from its activities in the region. 367 it is to be expected that they will exercise legal
One important lesson from ConocoPhil- action before the statute of limitations goes
lips’ success in its campaign to seize assets in into effect in order to preserve their claims.
the Caribbean is that, beyond the protection One option to prevent a rise in litigation
of dwindling fixed assets, creditor litigation volumes is for the Venezuelan government
also poses a risk to monetary flows arising to enact a tolling agreement to suspend the
from Venezuela’s oil exports. effects of the statute of limitations for a giv-
As we have noted in this section, arbitration en period. In fact, beginning in November

2020, the Maduro administration made sever- istration announced a unilateral suspension in
al offers to sign agreements of this type with March 2023, but this announcement also lacks
both the sovereign and PDVSA creditors that legal value in U.S. courts. 370 On August 8, the
conditioned the suspension of the statute of opposition-controlled 2015AN issued a similar
limitations on the suspension of litigation ef- tolling announcement, which has a higher likeli-
forts. 369 These proposals failed to gain trac- hood of reducing bondholder fears over the stat-
tion with creditors due to the Maduro admin- ute of limitations.371 However, the validity of the
istration’s lack of authorization to represent opposition announcement hinges crucially on US
Venezuela in U.S. court, which implies that a courts recognizing its acts as those of the Venezu-
contract signed with it has no legal value for elan government despite the interim government’s
bondholders. Ultimately, the Maduro admin- formal dissolution in December of 2022.
The Grounds for Alter Ego Determinations

Alter ego allegations must be proven on a ca- tity’s activities?
se-by-case basis and are decided on the com- • Does the government deal at arm’s length
pany’s relation to its owner at the time that the with the entity?
creditor requests the writ of attachment. This • Is the government the entity’s only source
means that mitigating the factors that have in of business?
the past helped creditors successfully argue the • Did the entity undertake the activity that
case remains pertinent to stop the proliferation provides the basis for the lawsuit on behalf
of attachment attempts against CITGO. of the government or at its insistence?
In the U.S., the standard of evidence for prov- Over the years, the Chávez and Maduro ad-
ing alter ego arguments against a foreign state ministrations, perhaps unwittingly, provided sig-
was originally set in the BANCEC decision. The nificant material to support alter ego allegations
courts try to answer the following questions:372 due to their disregard for corporate form and their
• Does the government treat the entity’s as- politization of the company’s operation. Examples
sets as its own? in this regard include the direct appointment of
• Are the entity’s employees considered civil CITGO presidents by the president of the Re-
servants? public and the subsequent announcement of the
• Does the government appoint or have the decision on social media or national TV. Beyond
right to remove board members? this, the Chávez administration also had CITGO
• Does the government supervise the enti- take additional debt to pay dividends to PDVSA
ty’s day-to-day operations? to aid in the Venezuelan government’s poor finan-
• Can the government circumscribe the en- cial situation.

THE GROUNDS FOR ALTER EGO DETERMINATIONS
Once Juan Guaidó assumed the representa-

•That the interim government drew
tion of the Venezuelan executive branch before
directly from accounts belonging to
the U.S. judicial system, the interim govern-
PDVSA subsidiaries, without declaring
ment’s representatives quickly turned to defend-
dividends, to fund its own expenses.
ing against alter ego allegations by pointing out
•That it commingled funds of the
that a major governance change had been effect-
Venezuela government with those of
ed and the deficient practices of past adminis-
PDVSA, handling them in common
trations had been cured. However, the 2015AN
bank accounts.
directly appointed the board members of several
•That it disregarded corporate form
PDVSA subsidiaries. Furthermore, it also ap-
by asserting that the company required
proved a transition statute that grants it exten-
National Assembly authorization to
sive control over PDVSA and continued to use
transfer its ownership interest in some
political language in some statements by Guaidó
assets (such as the Nynas Ab case), to
appointees – including in PDV Holding Annu-
commit its property as collateral for the
al Reports. It also published debt restructuring
PDVSA 8.5% 2020 bonds and even for
guidelines obligating PDVSA to assume the same
the payment of certain legal fees.
restructuring terms as the sovereign – despite the
•That it treated PDVSA assets as
fact that markets systematically price these obli-
belonging to the Government of
gations differently.
Venezuela in social media and other
In his March 2023 decision, Judge Stark noted
forms of communication, including
that “The moving parties have proven, by a prepon-
official communications.
derance of the evidence, that PDVSA has been and
That it treated PDVSA and
is the alter ego of Venezuela, at all pertinent times,
sovereign liabilities as similar and
including from August 2018 through at least Octo-
interchangeable, particularly in the
ber 13, 2022.”373 In other words, the judge decided
context of its debt restructuring
that the Guaidó administration had exerted an un-
guidelines of 2019, and required
due control over PDVSA that rendered the compa-
the company to coordinate its legal
ny a mere instrumentality. While he made the same
strategies with the chief legal officer
finding with respect to the Maduro government,
representing the Republic.
it was the finding with respect to Guaidó’s undue
•That it bypassed PDVSA’s ordinary
control that was relevant for the alter ego determi-
corporate governance by requiring
nation given the U.S. recognition of his interim
2015AN approval of contracts, funding
government.
of legal strategies, and appointment or
In regard to the Guaidó administration’s han-
removal of the board members of its
dling of the company, Judge Stark found:
subsidiaries.

In sum, U.S. courts have found that the Ven- control over its operations and disregarding
ezuelan government – both as represented by corporate form. Addressing these corporate
the Maduro and Guaidó administration – ex- governance deficiencies remains key to prevent
tensively failed to preserve the separate cor- further alter ego allegations from taking hold.
porate identity of PDVSA by exerting undue
Political Conflict and the Defense of External Assets
Venezuela’s political conflict has resulted in a represent the country. Venezuela’s failure to an-
diminished capacity to attend the full scope of swer the complaint resulted in a default judge-
functions required of a modern state, particular- ment in favor of the creditor.
ly in terms of its capacity to manage legal chal- Over the following months, the situation de-
lenges against its assets. The Guaidó administra- veloped into a public confrontation between the
tion, which was the only entity legally capable office and some members of the 2015AN over
of representing the Venezuelan state before U.S. the funding of these activities.375 Sánchez Fal-
courts between 2019 and 2022, failed to present cón indicated that political disagreement among
a legal defense in certain cases against the coun- the parties integrating the opposition coalition
try and was chronically slow in responding to backing Juan Guaidó was at the root of this re-
those it did. This problem is both a consequence fusal to fund his office’s expenses.
of the limited resources available to it and of the Later in the 2021, the United States District
political infighting within the Venezuelan oppo- and Bankruptcy Courts for the District of Co-
sition at the time. lumbia published an entry of default in one case
For example, in the first half of 2021, the involving ConocoPhillips’ USD 8.5 bn ICSID
Guaidó-appointed special attorney general, En- arbitration award. The entry of default was the
rique Sánchez Falcón, addressed a letter to Judge direct result of Venezuela failing to respond to
Analisa Torres of the United States District the court’s summons and thus forfeiting its right
Court for the Southern District of New York to answer to the complaint. The Prosecutor
excusing the Venezuelan government from pre- General’s office issued a statement explaining
senting a formal answer in a legal case involving that the administration was focusing on annul-
bondholders seeking repayment on defaulted ling the award before the ICSID and, thus, it saw
bonds.374 The letter, which was made available no merit on appearing before the U.S. Court.376
in the case’s docket, explained that the 2015AN While the annulment case at the ICSID remains
had not authorized the prosecutor general’s of- pending, a failure in the proceeding would leave
fice to undertake new foreign currency expenses, Venezuela exposed to the largest arbitration case
including the hiring of international law firms to against it.

POLITICAL CONFLICT AND THE DEFENSE OF EXTERNAL ASSETS
This lack of resources also resulted in a signif- government. In March 2023, VP leader Leopol-
icant rise in the average time to respond against do López – who between 2019 and early 2022
complaints in U.S. courts based on arbitration had served as presidential commissioner of the
cases. Between 2015 and 2018, Venezuela re- Center of Government in the Guaidó adminis-
sponded on average 83 days after initially being tration – claimed that the latter factor had made
summoned to the court. This figure rose to 316 impossible to mobilize funds in the U.S. with-
days for the 2019-2021 period.377 out a specific license from OFAC.379 In May, the
At the root of the problem lay a mismatch be- 2015AN regained access to these funds,380 but
tween the resources available to the interim gov- the assembly decided not to execute the bud-
ernment and the functions that a modern state is get approved for the year and, consequently,
required to perform. While the Guaidó-led ad- halted payments to law firms representing Ven-
ministration was tasked with representing Ven- ezuela altogether. 381 PJ, which was accused by
ezuela in foreign courts, it lacked the necessary representatives of VP of instigating the freeze
resources to do so effectively. In fact, by Octo- on payments, denied that this would mean sur-
ber 2022 the Guaidó administration had already rendering the control of assets to the Maduro
spent at least USD 44 mn in hiring foreign le- administration and reaffirmed its request that
gal firms since 2019 but owed almost USD 21 the U.S. continue shielding the country’s assets
mn.378 The problem is not limited to the mone- from creditors.
tary resources required to pay external contrac- The second major problem derived from the
tors. Guaidó asked all the members of his admin- political conflict lies in the profound politiza-
istration to work on a pro bono basis resulting in tion of the management of external assets. The
a poorly staffed administration with limited cause of PDVSA and CITGO for political means
pacity to make or implement long-term plans. It and the general disregard for the formalities as-
further had to contend with high turnover rates, sociated with its corporate structure have facili-
especially at key high-level positions. On the tated creditor allegations that the companies are
other hand, the Nicolás Maduro administration alter egos of the Republic.
has significantly more resources – of a human Politization in the management of state assets
and monetary nature – to manage the responsi- has also resulted in corruption allegations in the
bilities of a modern state but lacks the authority Monómeros case. The Colombia-based company
to do so before U.S. courts. – formally, Monómeros Colombo Venezolanos
Ultimately, the 2015AN stopped paying for S.A. – is owned by Pequiven, a Venezuelan state-
legal representation due to a combination of owned company concentrated in petrochemical
political infighting within the coalition and the products. In 2019 the interim government led
temporary loss of access to funds in the U.S. as by Juan Guaidó took management control of the
a consequence of the dissolution of the interim company after appointing a new board of direc-

tors in the wake former Colombian President ing complicit in their transfer to the country’s
Iván Duque’s recognition of Guaidó as Venezu- creditors. These accusations have been levied
ela’s president. in the context of CITGO,384 Monómeros,385
Corruption allegations and a lack of transpar- and other assorted assets. 386 When facing the
ency in the handling of the company were recur- accusation of being complicit or culpable of
rent since the takeover and the Superintendence the potential loss of external assets, the oppo-
of Companies of Colombia placed it under its sition usually responds by pointing out that the
most restrictive control figure in August 2021, Chávez and Maduro administrations were re-
after finding evidence of graft.382 sponsible for endangering the assets by taking
This situation sparked another round of excessive debt and due to the former’s national-
internal confrontation between Guaidó’s VP ization policies. 387
party and opposition coalition ally PJ, which After the Gustavo Petro administration formally
argued on repeated occasions that the interim recognized the Maduro government in late 2022,
government should not be involved in the man- control of Monómeros reverted to his administra-
agement of Venezuelan external assets. PJ also tion, highlighting the unstable nature of recogni-
demanded a comprehensive audit of the compa- tion and control under the current circumstances.
ny’s management.383 A third problem derived from U.S. sanctions
Faced with these accusations, VP defended against the country became evident in the case
itself by stating that the cases of corruption and of Nynas AB. PDVSA owned a 50.01% interest
the lack of transparency did not fall directly on in the Swedish company through its European
the interim government and Board of Directors subsidiary, PDV Europa. As a consequence of
appointed by Guaidó, but rather on the obsta- sanctions, by the end of 2019 Nynas was forced
cles imposed by the 2015AN to remove those to stop importing the Venezuelan crude it used
accused of corruption and appointing a new as a feedstock and couldn’t extend a series of
board of directors. It is worth noticing that bank loans, which left it unable to comply with
both parties reported a similar view of the cor- its financial liabilities.388 The company soon
ruption cases and lack of transparency but held entered a court-supervised reorganization pro-
different actors responsible. cess, in which PDVSA ceded a 35% interest
Maduro administration officials have also in the company to a private foundation under
variously accused foreign governments – most opaque circumstances.389 Interestingly, it was
frequently, the U.S. – and the opposition of the Maduro administration that was allowed to
“looting” various of the country’s external as- represent PDVSA in the court process that led
sets by withholding control over them and be- to this divestment.
The Protection of Venezuelan Foreign Assets

THE PROTECTION OF VENEZUELAN FOREIGN ASSETS
As we have explained in the previous pages, the acceptable to creditors and compatible with Vene-
level of protection afforded to a government’s fo- zuela’s urgent need to attend its humanitarian cri-
reign assets varies according to jurisdiction and sis. Given the advanced stage of the CITGO auc-
the ownership of the assets in question. In the Ve- tion proceedings, creditors could seek to provide
nezuelan case, those belonging to PDVSA and its as little relief as possible. On the other hand, not
subsidiaries are more exposed to attachment due all creditors may want to be perceived as taking
to the lack of sovereign immunity for assets em- advantage of Venezuela’s political and humani-
ployed for commercial objectives. Sanctions have tarian crisis, and public debate could be useful in
so far effectively blocked creditors from seizing generating consensus around a solution that fairly
them, but the latest developments in Crystallex’s compensates creditors while allowing a substan-
efforts to auction CITGO indicate that this pro- tial share of resources to be directed at helping
tection may not be extended indefinitely. address Venezuela’s problems.
If the U.S. government suspended its legal pro- Of course, the U.S. government could also con-
tection of the assets, preserving them would be tinue protecting the assets. One way to do would
a significant challenge for Venezuelan political be by instituting an asset protection order. Buch-
forces. As we have shown in this chapter, we place heit (2018) developed the idea originally, mod-
CITGO’s valuation at USD 9 bn, while the val- eling his proposal on the experience of Iraq be-
ue of the most immediate claims on the company tween 2003-2011. After Saddam Hussein’s ouster
currently stands at USD 10-20.3 bn. in 2003, the UN Security Council passed a res-
Assuming that the U.S. government decides to olution immunizing Iraq government asset from
suspend its protection, Venezuela’s best chance at creditor actions.390 UN member states then be-
retaining them would entail a negotiated agree- came legally required to enforce the resolution by
ment with the group of creditors identified in this passing domestic legislation giving it effect. Criti-
chapter. As we argue at further length in our rec- cally, the U.S. executive implemented the measure
ommendations, the best way to achieve this would through Executive Order 13303,391 which pro-
be to negotiate a repayment schedule to be fund- hibited “any attachment, judgment, decree, lien,
ed by PDVSA’s regular cashflows derived from its execution, garnishment, or other judicial process”
exports of crude oil. Such a repayment schedule and was signed by President George W. Bush in
could be structured to be complementary with an May of that year.
arrangement to loosen oil sanctions by requiring Negotiation and U.S. protection are not nec-
that the proceeds of exports to the U.S. be de- essarily mutually exclusive options. In fact, with
posited in escrow accounts from which a portion an asset protection order in place, the U.S. gov-
would be earmarked for debt repayment. ernment would have significant space to nudge
Perhaps the greatest challenge in this regard creditors into an agreement that would be fair and
would be to find repayment terms which are both palatable for all stakeholders.

Recommendations
The preceding discussion of the situation of Vene- It is also paramount that the authorities mitigate
zuela’s external assets and liabilities illustrates a set the factors that have enabled creditors to successful-
of risks that require prompt action by Venezuelan ly argue that PDVSA is an alter ego of the Republic.
political forces and the international communi- As we discussed in Chapter 1, the December 2022
ty. There is a significant risk that the country will reform of the transition statute approved by the
lose CITGO if either the current judicial process 2015AN assigned the responsibility of managing
to auction PDVH shares is allowed to continue and defending the assets formerly under the con-
moving forward or the U.S. government fully lifts trol of the Juan Guaidó administration to a board
sanctions on the country without providing an as- designated by the National Assembly. The change,
set protection order. however, does not address the problems discussed
Publicly available valuations of CITGO as a go- in this chapter as the composition of the board re-
ing concern range between USD 5.3 bn392 and USD mains firmly influenced by the opposition’s internal
13.4 bn,393 which means that the most direct claims politics and the underlying issue of the mismatch
against the company exceed its value or are close to between the resources available to the institution
doing so. Furthermore, given that further accumu- and the responsibilities required of it remains.
lation of claims against CITGO would complicate In this section, we provide recommendations on
a negotiated solution between the Venezuelan state how the Maduro government and the 2015AN can
and its creditors, it is paramount that Venezuelan cooperate to improve the country’s judicial defense
representatives attend to existing claims as soon as of the country’s assets, as well as renegotiate the
possible so as to stop the auction process from mov- claims that pose the most immediate threat to its
ing further forward. ownership of these.
A Cooperative Solution to Manage External Assets and Legal Defenses
As detailed in Chapter 1, the 2015AN created an ly a reflection of the political balance in the opposi-
“Asset Protection and Administration Board” in tion coalition – with one member from each of VP,
its December 2022 reform to the transition stat- PJ, UNT and AD complemented by a representa-
ute. While the board’s stated objective is to ensure tive from the minority parties – rather than based
a non-partisan and transparent management of the on technical expertise. Furthermore, four of its five
country’s external assets,394 its membership is large- members had previously served in the interim gov-

ernment’s Expenditure Control Council.395 litical agreement would have a higher likelihood of
The membership of the Asset Protection and enjoying greater international and legal legitimacy
Administration Board appointed by the 2015AN than appointments made by a single opposition sec-
gives little reason to believe that the new scheme tor or the Maduro administration by itself. It would
will be a major departure from the approach em- also provide a solution to the mismatch outlined in
ployed during Guaidó’s 2019-2022 interim gov- previous sections regarding the lack of resources to
ernment. It also fails to incorporate the Maduro undertake the functions of a modern state.
administration or other Venezuelan political and While the subject of this chapter is the protec-
civil society forces in a cooperative design and, tion of Venezuelan external assets specifically, it
thus, does not address the underlying issue of the would be remiss not to mention that this propos-
mismatch between resources and responsibilities al would still leave the question of how to handle
that we have outlined in this chapter. the resources made available to the board and what
Our proposal to improve on this design is for the to do with them. To a large degree, confrontations
Asset Management Board to be appointed in con- over the management of external assets arise from a
sensus through a negotiation process that includes desire from the political factions in the conflict to
the various political groups in the country as well claim the political benefits derived from the welfare
as, ideally, the active participation of key civil soci- gains that could be generated by the use of these
ety groups. We propose that, alongside representa- funds. To address this issue, we propose channeling
tives of the political parties themselves, the board cash flows generated by existing assets into i) hu-
incorporates non-partisan civil society members manitarian programs, as outlined in chapters 2 and
with proven expertise from four key backgrounds: 3, and ii) repayment of renegotiated priority debt
i) corporate management of public enterprises, ii) to settle existing claims on CITGO, as outlined in
corporate and commercial litigation, iii) financial the next section.
market structuring and iv) public policy design. Another possibility would be for CITGO to
The board should be primarily integrated by tech- provide oil product exports to Venezuela at sub-
nical experts, possibly complemented by additional sidized cost or for free, in order to attend the fuel
representation from political parties. scarcity crisis. This would ensure that the Venezue-
Our modified approach would address one of lans remain the main beneficiaries of the company’s
the key problems in the existing design; namely, recent improved operational results and would ad-
the politicization of asset management. The formu- dress one of the most recurrent problems putting a
lation of a strategy to defend Venezuela’s assets re- ceiling to economic activity and the improvement
quires technical expertise drawn from a wide range of humanitarian outcomes in the country.
of disciplines. It also requires long-term planning Besides the management of cash flows, the board
detached from the short-term goals of partisan pol- would be tasked with coordinating the appoint-
itics. A board appointed as a result of a national po- ment of a managing board for PDVSA and Pequiv-

en that strictly comply with corporate forms to pre- prove that PDVSA is an alter ego of the Republic to
vent the success of further alter-ego allegations by receive a court’s approval to pursue the former’s as-
creditors. It should also oversee the board members sets to satisfy obligations to them. As we discussed
it appoints to prevent them from issuing political in the previous section, a profound depoliticization
statements that could go against Venezuela’s legal of the corporate-board designation process and
defense strategy. Recall, from our prior discussion, strict adherence to the requirements of corporate
that creditors of the Venezuelan government (as form are key to prevent the success of future alter
opposed to those of PDVSA) must successfully ego allegations.
Renegotiating the Most Urgent Claims Against CITGO
The priority task of an Asset Management Board judgements prior to the consummation of the sale in
should be in negotiating a settlement on the most order to prevent it. The U.S. executive has also pro-
urgent threats to Venezuelan external assets. In prin- vided a license through OFAC that enables creditors
ciple, Venezuela appears to have enough cash hold- to negotiate with the 2015AN. However, Crystallex
ings to settle the USD 10 bn in claims that we have lawyers indicated that as of the end of 2022, the in-
identified as most urgent, as we have shown in Chap- terim government had been unwilling to negotiate a
ter 4. However, if ConocoPhillips were successful in settlement during the interim government.396 There
procuring a writ of attachment for its USD 10.2 bn is some indication that there is greater willingness
judgement against Venezuela, the matter would be- to negotiate, and some tentative talks may have oc-
come significantly more difficult. Furthermore, giv- curred, after the dissolution of the interim govern-
en the need to attend the humanitarian crisis in the ment and the creation of the Asset Protection and
country, settling debt with upfront payments should Administration Board by the 2015AN.397
not be a priority for policymakers. Instead, it would There is also ample evidence that the U.S. execu-
be preferable for the Venezuelan authorities to reach tive favors a negotiated solution to the creditor-debt-
an agreement with creditors to repay the most ur- or conflict surrounding CITGO and would provide
gent liabilities over an extended period out of future licenses required to implement it. On April 19,
PDVSA cash flows instead of by divesting from ex- 2023, OFAC published FAQ number 595 to clarify
isting assets. its position on this issue, which reads: “To the ex-
It is important to note that the auction procedure tent an agreement may be reached on proposals to
approved by the court in the Crystallex case explicitly restructure or refinance payments due to the holders
allows for Venezuela to satisfy or settle the attached of the [PDVSA 8.5% 2020] bond, additional licens-

ing requirements may apply. OFAC would encour- sition coalition have in the past held different views
age parties to apply for a specific license and would regarding the stance to be taken in negotiations
have a favorable licensing policy toward such an vis-à-vis bondholders, with key members of the co-
agreement.”398 Furthermore, press reports published alition that currently controls the 2015AN having
in November 2022 indicate that U.S. Ambassador to been much more in favor of reaching a negotiated
Venezuela James Story recommended to representa- agreement with creditors on terms opposed by those
tive of the Guaidó administration to negotiate with actors that played a more prominent decision-mak-
creditors seeking attachment of PDV Holding, sug- ing role in the now defunct interim government.401
gesting that PDVSA use the cash flows generated by In October 2022, Medina reacted to Judge Stark’s
CITGO itself to pay off these debts.399 approval of the final sale procedures in the Crystallex
In September 2021, press reports revealed that case saying that the board was considering “alterna-
the Guaidó administration had hired the U.S.-based tive options” to prevent a sale, while Crystallex law-
financial service firm JPMorgan Chase & Co to ad- yers noted that the company “[…] remains willing to
vise it on negotiations with creditors.400 According settle this dispute. In light of CITGO’s recently-re-
to president of the PDVSA ad-hoc board, Horacio ported profits, it seems clear that Venezuela can pay
Medina, the hiring was meant as a way to explore Crystallex.”402
alternatives to an outright sale of the PDV Holding In an interesting narrative twist, press reports
shares to satisfy creditor demands. It was also re- released in early 2023 revealed that ConocoPhil-
vealed that the bank has presented concrete propos- lips was in exploratory conversations with PDVSA
als on how to achieve this, but little detail on them to market Venezuelan oil in the U.S. to recover on
has so far been made publicly available. its debt.403 Importantly, these reports revealed that
While an adviser of the 2015AN noted at the time ConocoPhillips has a license issued by OFAC to
the need for expediency given the progress in Crys- negotiate its debt with the Venezuelan government.
tallex’s efforts to auction the PDV Holding shares, While the deal would provide an interesting way to
there is little indication that the initiative went much settle debt in a manner that would add value to both
further. Underlying this lack of action is likely the Venezuela and its creditors, it appears difficult to ex-
previously noted mismatch between the authoriza- tend this arrangement to parties that are not active
tion to represent Venezuela in a legal capacity and participants in the international oil market, such as
the availability of resources to do so effectively. De- Crystallex or the PDVSA 8.5% 2020 bondholders.
signing a repayment schedule that proves satisfacto- There is some precedent for the renegotiation of
ry-enough for creditors to suspend litigation efforts arbitral debt by Venezuela in recent years, although
is in principle possible but may require access to cash the economic and political crisis cut short the full re-
flows generated by oil exports that are currently out- payment of the debt. In 2016, Venezuela reached a
side of the 2015AN’s control. It’s also worth noting settlement with Gold Reserve – which held a USD
that different factions inside the mainstream oppo- 740 mn ICSID award against the country – under

which it would pay a total USD 1.0 bn in monthly a scheme would require USD 1.7 bn in yearly pay-
installments running through to June 2019.404 The ments. While this figure is certainly daunting for a
country paid USD 254 mn towards the settlement country in Venezuela’s current position, it would
before defaulting on the agreement in March 2018. amount to 26% of the additional exports that could
Similarly, in 2018, the Maduro government agreed be generated by raising oil production by 400 tbd
to repay Rusoro Mining – which also held an ICSID – which, as discussed in Chapter 3, is a reasonably
award against the country – with monthly install- conservative estimate of the medium – term increase
ments totaling USD 1.3 bn, that would start in No- in oil production achievable under a significant eas-
vember of that year and run until 2024.405 Despite ing of U.S. sanctions. Even if the country does not
the settlement, Venezuela failed to make even the manage to negotiate a nominal haircut, these terms
first installment. would require USD 2.1 bn in yearly payments, still
Also in 2018, PDVSA entered an agreement with just above a quarter of the potential increase in in-
ConocoPhillips to repay the previously discussed come derived from our proposal.
ICC award. The repayment structure was, however, However, negotiation between creditors and ei-
different from that agreed with Rusoro and Gold ther the Maduro administration or the 2015AN
Reserve by Venezuela, as it contemplated an upfront alone would present a problem for the medi-
payment of USD 500 mn and quarterly installments um-to-long term credibility, and possibly also for
running for four and a half years.406 ConocoPhillips’ the enforceability, of such an arrangement. For cred-
latest financial statements show that it received USD itors, an agreement designed to repay the debts over
768 mn from PDVSA in connection with the ICC a multi-year period would likely be subject to signif-
award before the Venezuelan national oil company icant uncertainty due to the possibility that a change
defaulted on the agreement in 2019.407 in government in the country could result in a dis-
Given the advanced stages of the effort to auction avowal of the scheme or a suspension of payments,
PDV Holding shares and the PDVSA 8.5% 2020 particularly given the highly-politized manner in
case, it appears improbable that the creditors in- which these matters have been handled in Venezu-
volved would accept large haircuts to their principal ela over the years. Furthermore, given the absence
claims. The conditions of a hypothetical deal would of both a clear claim over the country’s presidency
greatly depend on what can be negotiated with cred- from the 2015AN or of a statement that it recogniz-
itors and would condition the feasibility of the ar- es it as doing so by the U.S. government, it is possible
rangement. that even U.S. courts could be open to questioning
As an example, assume that the Venezuelan au- the validity of agreements between creditors and the
thorities negotiate for the USD 20.8 bn – inclusive 2015AN (as well as, of course, between creditors
of the ConocoPhillips judgement – to be repaid and Maduro). For these reasons, we recommend that
in 10 years, with no interest on the amount and a negotiations be conducted by a board endorsed by
20% nominal haircut on the debt’s face value. Such an agreement between both sides.

Attending the Crisis Beyond the Urgent
We believe that a negotiation with creditors in posses- A second dimension of uncertainty applies to how
sion of immediate legal claims on CITGO should be macroeconomic and fiscal variables would behave in
given paramount importance, but it is undeniable that the mid-to-long term future after a restructuring is
Venezuela will also need a much broader renegotiation conducted. When a debt restructuring operation takes
of its external debt. While not every creditor represents place, the debtor government and its creditors usually
the same level of legal risk on Venezuela’s external assets, negotiate a plan for repayment on the basis of the coun-
regaining access to financing will require that the country’s projected capacity to pay. Venezuela’s future capac-
try engages them and resolves arrears. ity to pay will likely prove highly controversial given the
While a resolution to Venezuela’s debt problem is large uncertainty on the speed of its economic recovery.
a necessary condition to its recovery, there are signifi- To illustrate these sources of uncertainty, consider
cant hurdles to a renegotiation under current circum- the most basic of debt indicators, the debt-to-GDP
stances. Beyond the previously mentioned problem ratio. The latest available datapoint for the country’s
regarding the Maduro government’s lack of legal ca- stock of external debt corresponds to 1Q19; not only
pacity to act in the representation of Venezuela within is this datapoint outdated by more than 4 years, it is
the U.S., and the opposition’s lack of economic means also presented with little detail on its contractual
to assume the full breadth of activities required of a terms, payment status or even creditor entities. Addi-
modern state, there is a fundamental problem of un- tionally, the opposition has in the past declared that
certainty regarding Venezuela’s economic situation it would perform a comprehensive audit of the stock
and its potential evolution. before restructuring,409 a step that could be import-
There is a first dimension of uncertainty regarding ant given the large uncertainty. However, the stock of
the current state of macroeconomic and fiscal vari- debt is not the only uncertain element in this simple
ables. Some of the most basic central bank datasets, equation; Venezuela’s latest nominal and real GDP
including those covering the balance of payments and figures also correspond to 1Q19.
GDP, have not been released to the public since 2019. On top of this, there is a great deal of uncertainty
Furthermore, the Venezuelan government has not re- regarding the speed of a potential economic recovery.
leased comprehensive fiscal data on its revenues and Among local economists, this debate has for long been
expenditures corresponding to periods coming after framed as the number of years that the country will
2009. The government did report its total revenues, take to regain the level of economic activity seen be-
total expenditures, and overall balance – at both the fore the crisis started (2013) and has produced very
central government and consolidated public sector varied assessments. For instance, Vera (2021) doubted
level – until 2016 in its Form 18-K submissions to the that Venezuela would be able to attain a sufficient-
Securities and Exchange Commission.408 ly strong pace of growth to recover its 2013 level of

economic activity within two decades. In contrast, debt would be frozen as is. This period would allow
Abuelafia and Saboin (2020) estimated that Venezu- the country to produce all the macroeconomic and
ela could attain this recovery in 13 years thanks to a fiscal data required for a thorough assessment of its
phase of highly accelerated growth in the immediate situation – which would include, among other things,
onset of recovery.410 The high degree of variance in reestablishing relations with the IMF, which typical-
these estimates reflects different assumption on the ly provides support in restructuring processes – and
recovery of the Venezuelan oil industry, the channels begin clarifying what its prospects for recovery are.
of transmission through which it impacts the broader Once this phase ends, then the country could negoti-
economy and the general institutional conditions un- ate a comprehensive restructuring of its debt on firmer
der which a recovery would take place. analytical and economic ground.
These assumptions have a direct impact on the level While both the Maduro administration and the op-
of debt that the country can carry. For instance, consid- position have issued tolling announcements suspending
er a highly simplified exercise in which the economy the statute of limitations until the end of 2028, these
starts recovery with its current estimated debt-to-GDP were not negotiated as part of an agreement from credi-
ratio (135%) and is required to cut down this debt-to- tors to suspend litigation, who retain the right to contin-
GDP ratio to 60% of GDP within 5 years. If the econ- ue their legal efforts. If a restructuring operation is not
omy grows at the pace outlined as overly optimistic by carried out by the end of the current suspension, credi-
Vera (2021), then this would require a 42% reduction tors may require an extension. A cooperative approach
in the nominal stock of debt. Conversely, if the econo- could help resolve these issues by negotiating them in the
my grows at the pace proposed by Abuelafia and Saboin context of a broader standstill on Venezuela’s debt.
(2020), then the country would require only a small 6% Beyond this, we also underscore that engagement
nominal reduction of its debt stock. Note that this ex- with the country’s creditors more broadly is of par-
ercise is presented for illustrative purposes only and ig- amount importance. Policymakers in stewardship
nores exchange rate dynamics, the probable need of ad- of the country’s future should carefully consider the
ditional indebtment in the early stages of the recovery medium and long-term consequences of inaction in
process, as well as a host of other relevant factors in the circumstances that may not always appear to have an
determination of the economy’s debt carrying capacity. immediate impact. A clear example is the proliferation
The high uncertainty on the amount of relief re- of judicial actions against the country, which could
quired to make Venezuela’s debt sustainable suggests significantly complicate a future restructuring if left
that the country would be better served by imple- unchecked. They should also seek to minimize legal
menting a two-phase solution to its restructuring. In threats against the hard currency inflows that would
the first phase, the country would negotiate a gener- result from the recovery of Venezuela’s oil industry
alized standstill on debt. In a first phase, the country and ensure that no creditor is given priority over oth-
would make no payments to most of its creditors (ex- ers, within the outlines of the customary framework
cluding super-senior creditors such as IFIs) and the of inter-creditor seniority.

Endnotes
329
This estimation of external public debt does not include local holdings of hard currency bonds. If we in-
clude these, the country’s debt would rise to USD 184 bn (161% of GDP).
330
Aceris Law LLC (2020).
331
Legal Sidebar (2016).
332
Esra and Andrew (2022).
333
Exceptions to the immunity from attachment or execution (2008).
334
Brunk (2018).
335
Brunk (2018).
336
Levin and Pettersson (2019).
337
Cornell Law School (n.d).
338
OI European Group et al. v Bolivarian Republic of Venezuela (2023).
339
U. S. Department of the Treasury (n.d.c).
340
See FAQ number 809. OFAC (2020).
341
Crystallex International Corp. v. Bolivarian Republic of Venezuela (2023a).
342
U. S. Department of the Treasury (2023).
343
Morales and García (2021).
344
Fitch Ratings (2022b).
345
Yapur (2022).
346
Figueroa (2023).
347
On September 12, 2023, Reuters reported that PDV Holding had valued itself at USD 32-40 bn. This
purported valuation was presented in the context of a legal action for the reissuance of its shares to its parent.
We note that the company has strong incentives to misrepresent its value in this context. Furthermore, a close
reading of the underlying text shows that these are purely hypothetical figures without proper analytical back-
ing. Since the range is well outside of analyst estimates, we do not include them in our assessment. See Parraga
and Hals (2023).
For instance, in 2020, Refineria di Korsou was successful in seizing the shares of Propernyn BV, a PDV-
348
SA-owned company in the Netherlands that owns an oil terminal in Curacao. See Garip (2020). Similarly, in
2019, Bernhard Schulte Shipmanagement was successful in seizing three tankers held by PDVSA in Portugal
and Singapore. See Geiger (2019).
349
Following the standard IMF methodology, we classify foreign currency bonds as external debt only when
held by non-residents. See IMF (2003). On the basis of the total amount of foreign currency bonds issued
by the Venezuelan public sector and the reported data for the “bonds and promissory notes” category in the
central bank report on external debt, we estimate that 31% of the bonds issued by the Venezuelan public sector
remained in the possession of Venezuelan residents by the end of 2018. This figure includes a USD 5 bn bond,
VENZ 6.5% 2036, that was issued by the Republic but that is believed to remain in the balance of public sector
entities in full. Since 2017 financial sanctions would have made significantly difficult for Venezuelan public
sector entities to sell their bond holdings, it is likely that a large amount of these bonds remains in the balance

sheet of resident entities.
350
Transparencia Venezuela (2020a).
351
Hornby (2016).
352
Pons (2018).
353
Transparencia Venezuela (2020b).
354
Pons and Armas (2020).
355
Armas and Buitrago (2023).
356
Crystallex International Corporation v. Bolivarian Republic of Venezuela (2011).
357
Crystallex International Corp. v. Bolivarian Republic of Venezuela (2017).
358
Crystallex International Corp. v Bolivarian Republic of Venezuela & Petróleos de Venezuela SA (2019).
359
Crystallex International Corp v. Bolivarian Republic of Venezuela (2020).
360
Crystallex International Corp. v Bolivarian Republic of Venezuela & Petróleos de Venezuela SA (2022).
361
Crystallex International Corp. v Bolivarian Republic of Venezuela & Petróleos de Venezuela SA (2023a).
362
Crystallex International Corp. v Bolivarian Republic of Venezuela & Petróleos de Venezuela SA (2023b).
363
Crystallex International Corp. v Bolivarian Republic of Venezuela & Petróleos de Venezuela SA (2023b).
364
Fieser et al. (2022).
365
Blum (2021).
366
ConocoPhillips Gulf of Paria BV v Corporación Venezolana del Petróleo (2022).
367
See Majaski (2022) for a general description of the statute of limitations and how it applies, and Neuhaus
368
and Neverova (2017) for the specifics of how it relates to bonded debt.
See PDVSA (2020a), PDVSA (2020b), PDVSA (2021a), PDVSA (2021b), Ministerio del Poder Popular de
369
Economía, Finanzas y Comercio Exterior (2020).

370
Ministerio del Poder Popular de Economía, Finanzas y Comercio Exterior (2023) and PDVSA (2023).
371
Yapur (2023b)
372
Norton Rose Fulbright (2015).
373
OI European Group et al. v Bolivarian Republic of Venezuela (2023).
374
Pharo Gaia Gund, Ltd. Et al. v. Bolivarian Republic of Venezuela (2021).
375
Nederr (2021).
376
Martínez (2022a).
377
Rodríguez (2021b).
378
Ocando (2022) and Reuters (2023).
379
Itriago and Marlow (2023).
380
Itriago and Flatley (2023).
381
De Jesús (2023).
382
Libertad Diario (2021).
383
Juan Guaidó, Venezuela’s former interim president, requested his disincorporation from his party, VP, on
January 6, 2020, in order to devote his full attention to his new position and its responsibilities. This move
came as a consequence of ally demands that the interim president should represent all Venezuelans rather than
simply a political faction. Despite the disincorporation, the party remained Guaidó’s primary source of support
within the opposition coalition and was, for a period of time in 2023, VP’s candidate for the opposition prima-
ries scheduled to take place in October 2023.

Notwithstanding being barred from running for president by the Maduro administration until 2038, Guaidó
has gotten backing from several opposition groups, notably VP. On March 7, 2023, the political party con-
firmed that Juan Guaidó will be their candidate in the presidential primaries organized by the Plataforma
Unitaria for October 22. The decision was made in August 2022 at a Federal Meeting of Activists in Carabobo
state. VP nominated former lawmaker Freddy Superlano for the opposition primaries after Guaidó fled to the
US in exile. See Infobae (2020; 2023b; 2023c).
384
France 24 (2023) and Diario El Universal (2023).
385
Runrun.es (2021).
386
DW (2018).
387
Primero Justicia (2023) and El Pitazo (2023).
388
389
Procuraduría Especial de la República de Venezuela (2020).
390
391
392
Fitch Ratings (2022b).
393
Yapur (2023a).
393
Yapur (2023a).
394
Prensa AN (2023).
395
The Expenditure Control Council was created by the 2015AN in 2020 as the entity tasked with directing, evalua-
ting, processing, and approving payments by the authorities of the interim government.
396
Fieser, Itriago and Zerpa (2022).
397
Párraga (2023).
398
U. S. Department of the Treasury (n.d.c).
399
Fieser, Itriago and Zerpa (2022).
400
Yapur and Fieser (2021).
401
Petroguía (2020).
402
Reuters (2022a).
403
Garip (2023).
404
Gold Reserve Inc. (n.d).
405
Rusoro Mining (2022).
406
ConocoPhillips (2021).
407
Párraga (2023).
The 18-K form is a disclosure requirement for non-U.S. sovereign governments that issue securities in the U.S.
408
under certain conditions. See Thomson Reuters (2023) and U.S. Securities and Exchange Commission (2017).
409
Asamblea Nacional (2019c).
410
The authors write that “The economy is thus expected to grow by 11% coming out of the emergency to recover
some 35% the next year and then grow by around 12% in the following five years to gradually even out at a 6%
growth% growth rate in the long run.

Chapter 6
Rethinking Policy and Negotiations Design
In previous chapters, we elaborated on a narrative politization of public policy in the country. We

of Venezuela’s current economic crisis that empha- analyze the ways in which social policy may have
sized the role of both the external shock caused by been coopted for partisan gain and how it can be
the collapse of oil prices in the 2014-16 period and reformed to better serve the population in the con-
the adoption by political actors of scorched earth text of cooperation between the Maduro adminis-
strategies that damaged the economy by prioritiz- tration and the opposition. We also put forth a few
ing short-term political gains over long-term pro- thoughts on how negotiations can be reformed to
ductivity. Poor economic policymaking also played be more effective.
an important role, as shown in negative rates of
productivity growth over the past two decades.
In this chapter we look more deeply into the
RETHINKING POLICY AND NEGOTIATIONS DESIGN 189

Politicization of Social Programs
The use of social programs to reward or gain po- grouped together in the Food Mission (Misión Al-
litical support for the ruling party has been a per- imentación), to which the government then added
vasive institutional problem in Venezuela over the a chain of larger government-operated supermar-
past two decades. In 2003, former President Hugo kets, the “Abastos Bicentenario.”
Chávez created the Misiones system, which con- Penfold (2007) framed this early expansion of
sisted of a group of large-scale and well-funded social policy under the Chávez administration as
initiatives designed to attain specific social-policy a response to increasing electoral challenges from
goals – in public health, education, and nutrition, the opposition. Venezuela was enjoying an oil
among other areas – through a design that put their boom that provided the government with an in-
management and funding outside of the conventio- crease in foreign exchange revenues due to high oil
nal structure of the central government and bypas- prices that allowed it to fund lavish expenses. Pen-
sed national assembly supervision. fold found that the creation of the Misiones sys-
The Misiones system was widely criticized by tem allowed the Chávez government to directly
the opposition, which deemed it as providing distribute oil rents to low-income voters both for
low-quality alternatives to already existing pub- legitimate and partisan purposes, which allowed it
lic services. Some previous academic work in to consolidate a constituency that would support
fact found no improvement in educational and it in future political contests. He also argued that
health indicators beyond that which would have Mercal’s large role in the distribution of food in
been normal in the context of an oil boom.411 the country made private sector firms increasingly
Concurrently with the Misiones system, the dependent on the state.
government also created an extensive network of During the Chávez and early Maduro admin-
state-owned stores under the “Mercal” label for istrations, the government also influenced the
distribution of heavily subsidized products with supply of essentials through a foreign exchange
which it significantly expanded the role of the control and rationing system that allowed it to
state in the supply of food. At their peak, more direct significant amounts of hard currency at a
than 70% of Venezuelan households reported heavily subsidized exchange rate to the import of
buying products in Mercal.412 The establishments certain products, including food and inputs for
were then complemented with another retail agricultural production. The system allowed the
chain funded directly by the state-owned oil com- government to play a significant role in directing
pany, Venezuelan Production and Distribution the country’s imports through the approval or de-
of Food (Producción y Distribución Venezolana nial of foreign exchange purchase requests at the
de Alimentos, PDVAL). Both retail chains were heavily subsidized rate.

This model began showing cracks as oil ex- of supervising price controls, and attempting to
port revenues began to decline after 2013 due to channel the bulk of subsidized food sales through
lower export prices and declining oil production, government-owned stores.
in combination with higher domestic fuel con-
sumption. The government initially maintained
the exchange rate virtually unadjusted, due to
concerns that an exchange rate depreciation
would pass through to inflation. This led to a
rising black-market premium and the formation
of a thriving arbitrage industry. The government
reacted by tightening price controls, increasing
the enforcement powers of the agency in charge
The Fatherland Card and CLAP Food Boxes
In 2016, President Maduro announced that he receipt of cash transfers. While initially issued
would restructure the Food Mission after ordering as physical cards, in 2020, the government began
the arrest of 55 managers and employees of the Bi- distributing virtual personalized QR codes that
centenario Hypermarkets for diverting regulated could be scanned through a mobile app to those
food items for their resale in the black market.413 who registered through the central web registry,
One month later, he announced the creation of also known as the Fatherland System (Sistema
the CLAP and the relaunching of the Food Mis- Patria).414 The government claimed that 21.8
sion as the Sovereign and Secure Supply Great million Venezuelans had registered for a Father-
Mission (Gran Misión Abastecimiento Soberano y land Card as of January 2023.
Seguro). The basic idea behind the new system was While eligibility for the Fatherland Card is open
to fight corruption and “economic war” through to all Venezuelan citizens who hold a national ID
community organization. The new program sou- card and are aged 15 or older, many cash transfers
ght to replace the government bureaucracy of the are conditional, with the criteria used by the gov-
food stores system with local food distribution ernment to determine eligibility for each specific
committees run by community leaders. transfer unclear. Suspicions of political bias in ac-
In 2017, Maduro also announced the creation cess to benefits distributed through the card –but
of the Fatherland Card (Carnet de la Patria), a not in access to the card itself– are frequent.
government-issued card entitling the holder to According to news reports, the government

also merged data collected in applications for CLAP members are primarily designated by
the Fatherland Card with information on social pro-government political organizations. Each
media profiles and political activity to monitor CLAP committee has nine members. Eight of
Venezuelans’ behavior.415 There is certainly prec- them, known as spokespersons, are designated
edent for the government maintaining large- either by other organizations (6) or elected in
scale databases with political information and local assemblies (2). The ninth member, who
using them to mobilize supporters as far back presides the committee, is elected by the spokes-
as 2003.416 The government claims that the in- persons from a set of candidates proposed by
formation collected through the card is used to the communal council. Of the six designated
improve the efficiency of the distribution of ser- members, four are appointed by pro-govern-
vices, for which it makes sense to merge it with ment social or political movements which are
other information on recipients available to the not formally part of the structure of the state
government. (though are known or believed to receive sig-
Rodríguez (2023c) points that a process of po- nificant government funding ): the National
litical self-selection for the program has played a Women’s Union (UNAMUJER), a feminist or-
role in the biased distribution of benefits. Several ganization created by Maduro; the Francisco
factors may have led citizens that self-identify as de Miranda Front, an organization created by
members of the opposition to voluntarily refuse former-President Hugo Chavez and former Cu-
to register to receive the card and related benefits, ban leader Fidel Castro to support and survey
even in the absence of legal or practical impedi- social programs, and the Units of Battle Hugo
ments. These include fears of governing monitor- Chávez (which appoints two members), civil-
ing, a strong symbolic association of the card itself ian groups created to “defend the revolution”
to pro-government partisanship and strong criti- affiliated to the governing Socialist Party. The
cism by opposition leaders based on accusations remaining two members are appointed by the
that access to benefits being conditioned on hav- communal councils and the Bolivarian militias,
ing the card was unconstitutional.417 the latter of which is formally affiliated with
Alongside the Fatherland Card, the Maduro the armed forces.
administration increasingly relied on direct dis- Once a CLAP committee is established in
tribution of food packages by local committees the community, it carries out a house-by-house
to participant families under the CLAP program census in cooperation with the communal
as the means to implement social policy.418 The council to determine how many families will re-
committees, which are meant to come from and ceive food boxes. In principle, all families in the
represent the community, work alongside the community are eligible to receive one box with
food ministry to distribute the packages sold at every delivery. Some families are eligible to re-
subsidized prices to program participants. ceive more than one box depending on their

THE FATHERLAND CARD AND CLAP FOOD BOXES
needs (e.g., families with a pregnant member, Some scholars have claimed that the use of
large-sized families, and families with members CLAP boxes have allowed the government to
who show symptoms of undernourishment). improve the effectiveness of its mobilization of
Families must designate a head of the house- voters and is one of the factors behind its im-
hold, who is entitled to receive the subsidized proved electoral performance. During several
food box and is in charge of paying for it. Fam- elections held in 2017, there is evidence that the
ilies are encouraged, but not required, to reg- government distributed food bags and allowed
ister for access through the Fatherland System. respondents to update their Fatherland Cards
Accusations of political bias in the distri- at pro-government mobilization booths, also
bution of CLAP boxes are frequent. The Ven- known as “red points” located outside of voting
ezuelan Education-Action Program (Programa centers (updates needed to be done in person at
Venezolano de Educación Acción, PROVEA) the time to maintain access to benefits).420 This
(2016) cites an opposition community organiz- does not mean that the government was able to
er from Caracas arguing that the government condition access to the CLAP packages or other
systematically targets distribution to pro-gov- benefits on how people voted, as the red points
ernment strongholds. Another resident cited in operate independently of voting centers. Fur-
the same study denounced that the local head thermore, the provision of bags also appears to
of the communal council in his district would be prevalent in only a minority (25%) of voting
single out opposition supporters in food distri- centers, according to a survey carried out by To-
bution lines and ordered that they not receive rino Economics in the December 2017 munici-
food bags. Transparencia Venezuela (2020) also pal elections.421
cites a CLAP committee member defending the Some NGOs and journalists have published
allocation to Maduro supporters as a reasonable accusations indicating that the Card of the Fa-
rationing mechanism in the presence of insuffi- therland system was used to condition votes by
cient supplies. requirement prove of vote for the assignation of
Yet, the Venezuelan government has denied benefits. It is hard to judge these accusations in
claims of political discrimination related to the absence of documentary evidence, given Ven-
the CLAP program, suggesting that these alle- ezuela’s charged polarized political climate and
gations are part of disinformation campaigns the incentives that political actors on both sides
orchestrated by the opposition. Freddy Bernal, of the divide may have to misrepresent and distort
who served as the National Coordinator of the information. Nevertheless, even if unfounded, the
CLAP system from 2016 to 2020, dismissed the belief on the accusation can by itself be enough
notion that opposition supporters were deliber- to dissuade voters from casting votes against the
ately excluded from the distribution network, government. Put differently, even a small amount
labeling it as a “complete lie.”419 of uncertainty about the ability and willingness

of the government to use social programs to carry dard goods. Given the massive amounts of re-
out retribution against its opponents would make sources channeled through the CLAP system
it rational for many voters not to put at risk their and the levels of opacity of the Venezuelan
access to benefits without which they would expe- state at all levels, the corruption allegations are
rience significant hardship. unsurprising. Nevertheless, since overpricing
There have also been numerous accusations compared to international standards is likely to
of corruption related to the CLAP program, emerge in any transaction with the Venezuelan
particularly regarding the procurement of state as a reflection of implied regulatory, rep-
goods. An Armando.Info (Deniz, 2017) inves- utational and financial risks, large differentials
tigation found evidence of overpricing and the from international prices cannot by themselves
provision of adulterated or otherwise sub-stan- be taken as direct evidence of graft.
Evidence on the Reach of the CLAP Program
According to government spokespersons, the two stages: a tripling of assistance between 2014
CLAP food boxes currently reach some 7 mil- and 2015, associated with greater provision of
lion families or more than 75% of Venezuela’s subsidized food items through government-run
population.422 Some NGOs have put forward stores, followed by a more than doubling of assis-
more conservative estimates in the 1.7-2.3 mil- tance with the transition from food stores to the
lion region, 423
while Transparencia Venezuela CLAP system.424 As a percentage of all families,
(2017) found that 67% of the families received ENCOVI finds that around 90 percent of house-
food packages but did so sporadically. holds receive boxes through the CLAP system,
ENCOVI survey data indicates that the share although participation has declined somewhat
of the population that had access to subsidized from the peak of 95% in 2018 to 86% in the most
food through government programs from 2014 recent 2021 survey.
to 2021 was broadly in line with government es- In terms of absolute numbers of participant
timates. Between 2014 and 2016, the data cap- households, ENCOVI estimates 15.2 mn. This
tured respondents who purchased products in estimate is broadly similar to official numbers.
the government-run food stores; from 2017 on, The lower numbers provided by some NGOs
they include recipients of CLAP packages. The may reflect somewhat more stringent criteria
data show a massive increase in food assistance, for determining whether families are counted
rising from less than 50% of households in 2014 as participants.
to more than 80% in 2018-21. The rise occurs in

Figure 13: Food- related government program beneficiaries, 2014-2021
Source. Own calculations based on ENCOVI.
The fact that around 90 percent of families lies received the box at least once a month, to a
receive food boxes does not tell us how fre- much lower share of 26% in 2021.
quently they receive them nor whether the sub- An additional source of data on the reach of the
sidy is adequate to meet their needs. ENCOVI CLAP program comes from the periodic opinion
also reports data on the frequency of times that surveys carried out by Datanálisis, a local firm with
families receive the packages,425 showing that a long tradition in the measurement of Venezuelan
around half of the recipients receive the pack- public opinion. While the individual surveys are
ages less than once every two months, and only much smaller in sample size than ENCOVI –they
a third receive them at least once a month. On range from 500 to 1000 respondents– the firm
average, this would imply that families receive generally conducts the surveys with monthly or
4.4 packages a year or one package every 2.7 bimonthly periodicity and has included questions
months. 426 There has also been a deterioration on CLAP access in the majority of its surveys since
in the frequency of coverage, with the peak fre- mid-2016. It thus allows us to have 28 monthly es-
quency attained in 2018, when 41% of fami- timates of CLAP access.

Figure 14: Receipt of CLAP packages by frequency, 2017-2022 (% of households)
Source. ENCOVI.
These aggregate numbers are consistent with the first half of 2021, with the data from the sec-
the big picture shown by the ENCOVI data but ond part of 2021 recovering their prior levels. Part
also show some interesting differences. The num- of the reason why a trend of decline may be appar-
ber of respondents that claim to receive CLAP ent in the ENCOVI data is the timing of the latest
packages in the 2018-21 period averages 82% ENCOVI survey, which was conducted between
–as opposed to 91% in ENCOVI– while those February and April 2021. Datanálisis does show
that claim to have received packages during the a decline in coverage in these months, with the
last month average 47%, as opposed to 35% in share of persons who received boxes during the
ENCOVI. last month averaging 31% –not all that different
Perhaps most importantly, the Datanálisis data from ENCOVI’s 26%.427
do not show a trend in decline in coverage appar- ENCOVI also asks respondents how much they
ent from ENCOVI. Rather, it shows a decline in pay for a CLAP package. 95% of respondents claim
the number of families that received packages with to pay one dollar or less, and the average payment is
monthly frequency in the second half of 2020 and USD 1.2. ENCOVI uses an estimate of USD 20 as

Figure 15. Received CLAP packages in past and last month, 2016-2022
Source. Datanálisis.
the value of each package, implying an effective sub- prior Food Mission system of indirect subsidies
sidy of 94%. Combining this information with the through government-run stores. The reason is
average frequencies reported above, we derive an es- that items lost due to arbitrage would be resold
timate of USD 854 mn a year in CLAP subsidies. in other markets and would thus not be quanti-
This estimate is equivalent to 16% of 2020 imports fied among those received by the family in the
of all goods and 46% of imports of food. It is also ENCOVI surveys. High losses due to arbitrage
equal to 8% of estimated 2021 central government would imply that the government bill in food
spending. Note that this subsidy estimate does not purchases would be substantially larger than the
count administrative expenditures or losses due to USD 854.8 mn in sales of subsidized food re-
wastage, arbitrage, or corruption so that the actual ceived by families through the CLAP system –
cost of the program to the Venezuelan government yet we know that it must be strictly lower than
could be much higher. the country’s total food imports, which reached
The size of the estimated subsidy suggests that USD 1.9 bn in 2020.
the CLAP system very likely contributed to con-
taining losses due to arbitrage compared with the

Assessing Political Bias in Venezuelan Social Programs
Does the government use its social programs nus]) through the Card of the Fatherland system
to target its supporters? Does that make it ea- and whether the respondent has been vaccinated
sier for government loyalists to access benefits? against COVID.
What effect does this have on the country’s poli- The data clearly show that government sup-
tical process, and on the fairness of its elections? porters are more likely to receive all three types of
These questions arise frequently in the con- benefits. Without conditioning on other charac-
text of Venezuelan political debates, yet to date teristics, the likelihood of a government support-
remain unanswered in a systematic basis. Accusa- er receiving CLAP boxes is 19 percentage points
tions of political bias in access to social programs higher than that of an opposition supporter, and
by Venezuela’s opposition are as frequent as deni- 8 percentage points higher than that of an un-
als by the government and its supporters. Anec- aligned respondent. Yet while the bias exists in
dotal evidence of instances of discrimination is all three questions, it is greatest for the Card of
not difficult to find, yet in Venezuela’s polarized the Fatherland, where a government supporter is
political landscape, it isn’t always clear that such almost twice as likely to receive a cash transfer
evidence is genuine or representative. than an opposition supporter, and much smaller
In this section, we study the patterns in access for COVID vaccines, where the difference is less
to social benefits using a database of 27 surveys than 3 percentage points.
carried out between October 2016 and Octo- At the same time, it is clear from these cross-
ber 2021 by the Venezuelan public opinion firm tabs that there is nothing even remotely resem-
Datanálisis. The surveys, with sample sizes rang- bling total exclusion of opposition supporters
ing from 500 to 1000 respondents per survey, from the programs. More than two-thirds of op-
include questions on receipt of CLAP packages, position supporters receive CLAP packages and
benefits through the Card of the Fatherland and around half receive Fatherland Card transfers.
COVID vaccines, as well as political self-identi- While the patterns suggest that there may be
fication. The samples are designed to be repre- political bias in the allocation of benefits, it also
sentative at the national level. suggests that these biases are not strong enough
Tables 21-23 present crosstabs of three ques- so as to severely restrict opponents from access-
tions regarding access to each of these benefits ing the benefits. Rather, the high coverage rates
by political self-identification. The questions are suggest that the exclusion mechanisms may take
whether the respondent’s household has received the form of raising the cost of participation for
CLAP packages, whether the respondent has opponents relative to supporters to a level that
received a cash transfer (also called “bono” [bo- many opponents may be willing to pay.

Table 21. CLAP package beneficiaries by political self-identification
Receive CLAP Boxes Pro-Government Pro-Opposition Unaligned DK/DA All
Yes 88.3% 69.2% 80.8% 79.2% 78.0%
No 11.3% 30.1% 18.7% 18.7% 21.4%
DK/DA 0.4% 0.7% 0.6% 2.1% 0.7%
Total 100.0% 100.0% 100.0% 100.0% 100.0%
Table 22. Fatherland Card transfers beneficiaries by political self-identification
Receive Fatherland Card Transfers Pro-Government Pro-Opposition Unaligned DK/DA All

Yes 84.4% 46.5% 61.2% 66.3% 60.2%
No 14.7% 51.8% 37.5% 28.5% 38.3%
DK/DA 0.9% 1.7% 1.3% 5.2% 1.5%
Total 100.0% 100.0% 100.0% 100.0% 100.0%
Table 23. COVID vaccines beneficiaries by political self-identification

Receive COVID vaccines Pro-Government Pro-Opposition Unaligned DK/DA All
Two doses 27.0% 23.8% 24.7% 25.9% 24.9%
One dose 25.4% 19.5% 21.0% 22.2% 21.2%
Wants to but not vaccinated 36.2% 25.6% 32.0% 14.8% 30.5%
Does not want vaccine 8.7% 18.6% 13.7% 3.7% 14.1%
May want depending on vaccine 2.7% 11.9% 8.5% 29.6% 9.0%
DK/DA 0.0% 0.6% 0.1% 3.7% 0.3%
Total 100.0% 100.0% 100.0% 100.0% 100.0%
Two doses/willing 30.5% 34.6% 31.8% 41.2% 32.4%
One doses/willing 28.7% 28.3% 27.0% 35.3% 27.7%
These simple crosstabs do not control for therland Card bonuses and CLAP boxes, given
respondents’ socio-economic characteristics, that both benefits are in principle universal.429
so they could simply be reflecting the fact that Putting aside momentarily the issue of con-
government supporters are likely to be poor- trolling for socioeconomic characteristics, it is
er or in greater need of the subsidies. In fact, also unclear whether these differences in group
52% of government supporters belong to the access are the result of government targeting or
“E” (lowest) socio-economic status subgroup, political self-selection. Government supporters
in contrast to only 39% of government oppo- may simply be more willing to request benefits
nents.428 It is nevertheless suggestive that the than the opposition because they support these
difference between government supporters and policies, while opponents may refuse to play
other groups varies so much between the Fa- along with a policy design that they see as an

abuse of state power and in which participating or transfers received during the previous month
can be seen as an implicit or explicit endorse- than for having received these at some time in
ment of the government. the past.
We can get some clues as to the strength of By contrast, we do not find significant effects
this self-selection process in the case of vaccines, of being a government opponent or unaligned
where the survey explicitly asks respondents relative to being a government supporter on the
whether they want to receive a vaccine. 19% of likelihood of receiving access to COVID vac-
opposition supporters claim that they do not cines. Once we restrict the sample to those that
want to be vaccinated, more than double the 9% want to be vaccinated, the coefficient estimate
of government supporters. Another 12% say that turns positive though insignificant for opposi-
they may want to be vaccinated depending on tion supporters and is essentially zero for un-
which vaccine. Note that international studies aligned respondents.
do not find a strong correlation between vaccine The COVID vaccine regressions thus pro-
acceptance and socioeconomic group.430 In fact, vide evidence that, at least in that intervention,
if we exclude respondents who do not want to be political self-selection plays a role in determin-
vaccinated from the sample, we find that governing the willingness to participate in government
ment opponents willing to accept a vaccine were programs. At the same time, the fact that this
actually more likely than government backers to self-selection affects the willingness to be vacci-
be vaccinated. This pattern strongly suggests nated but not the likelihood of being vaccinat-
that the government did not strongly target vac- ed suggests that government policy has played
cines towards its supporters. a role in compensating for these differences.
More systematic regression analysis finds The most likely explanation is that vaccination
that opposition supporters are much less like- sites are more frequently located in areas with
ly to receive CLAP packages and Fatherland stronger opposition support (e.g., large cities)
Card transfers than government supporters; and that our controls don’t completely pick up
unaligned respondents fall in the middle, being those geographic differences.
less likely to receive the benefits than govern- The results thus suggest that the government
ment supporters yet more likely than oppo- is capable of designing programs that ensure that
nents. Those who do not declare their politi- politically motivated differences in willingness
cal affiliation are also generally less likely than to participate do not necessarily lead to low-
government supporters to receive the benefits, er participation rates among non-government
though the latter tend to be treated better not supporters. Indeed, after an initial public opin-
just than opposition supporters but also than ion outcry when Maduro suggested that vac-
those that state who declare that they are un- cines would be distributed through the Card of
aligned. The results are stronger for packages the Fatherland,431 the government backtracked

ASSESSING
ASSESSING POLITICAL
POLITICAL BIAS
BIAS IN
IN VENEZUELAN
VENEZUELAN SOCIAL
SOCIAL PROGRAMS
PROGRAMS
and allowed requests for vaccination appoint- of respondents reported receiving 1 clap food
ments to be made through the health ministry box per month, 20% 1 every 2 months, 10%
site without using the Fatherland System. 432 one every quarter. Meanwhile, 0.9% reported
Vaccines were also administered by health min- receiving more than 1 box per month and the
istry officials, without the participation of the rest said that supply was irregular or didn’t
political committees used to allocate CLAPs. know the answer. The results show that over
The fact that the effects are stronger for re- 60% of the surveyed population received at
cent access to CLAP packages and Fatherland least one CLAP food box every three months.
Card bonuses than in program participation is Alongside questions on the periodicity
also evidence against the idea that the differences with which the respondents received the ben-
are completely driven by political self-selection. efit, the survey also asked about their polit-
While we could expect some opposition sup- ical affiliations. Interestingly, the data shows
porters to opt out of these systems because they that respondents who identify with Chavismo
do not want to be perceived as lending their sup- broadly reported receiving at least one food
port to government policies, it is not clear why box per month at a lower rate (29%) than ei-
an opposition supporter would be more likely to ther opposition supporters (32%) or neutrals
register for the program and be willing to receive (33%). This contrasts with Datanálisis find-
food packages occasionally but be less willing to ings, suggesting that more intensity of politi-
receive them more regularly (given that we are cal competition leads the government to allo-
adequately controlling for respondent needs cate more packages to neutral and opposition
through our control variables). voters.
The Oil for Venezuela Foundation com- When directly asked if receiving the benefit
missioned a survey to verify whether these was contingent upon a menu of potential po-
results were systematically different in times litical conditions, 83% of respondents stated
of electoral competition. The sample cov- that no conditions beyond paying for the food
ers 2500 heads of households in the states box were imposed, while 15% mentioned that
of Barinas and Apure and asked respondents only registering in the Fatherland system was
about their receipt of CLAP food packages required. The survey also inquired about five
during the last quarter of 2021 and the first other potential conditions, such as voting in
quarter of 2022, a period which included the elections, participating in pro-government ral-
holding of gubernatorial elections in two lies, supporting the government, and being a
closely contested states. member of the ruling party, as well as any oth-
Overall results on program participation er unspecified conditions. Only 2% of respon-
are broadly in line with those of ENCOVI dents reported being subjected to at least one of
and Datanálisis. The survey found that 30% these additional conditions.

These results support the thesis that compet- findings also support the hypothesis that de-po-
itive elections may serve to reduce political bias liticizing the CLAP program would increase the
in the assignment of CLAP food boxes. The program’s effectiveness and equity.
Table 24. Periodicity of reception of CLAP food boxes by political affiliation, results from Barinas and
Apure study
At least
Political affiliation Bi-monthly Quarterly Other
monthly
Chavismo (supportive of Maduro) 27.6% 23.3% 10.0% 39.1%
Chavismo (but not supportive of Maduro) 33.5% 12.4% 11.8% 42.2%
Neutral 33.4% 19.0% 9.3% 38.3%
Opposition (but not supportive of the mainstream coalition) 38.9% 11.1% 9.5% 40.5%
Opposition (supportive of the mainstream coalition) 27.1% 21.7% 9.8% 41.4%
Doesn’t answer 25.6% 16.7% 12.8% 44.9%
Total 30.5% 19.9% 9.9% 39.7%
Chavismo in general 28.5% 21.8% 10.3% 39.5%
Neutral 33.4% 19.0% 9.3% 38.3%
Opposition in general 31.8% 17.5% 9.7% 41.0%
Doesn’t answer 25.6% 16.7% 12.8% 44.9%
Table 25. Reported conditioning by respondent who received CLAP food boxes, results from Barinas
and Apure Study
Condition Total Percent
Vote in elections 13 0.7%
Participate in pro-government rallies 4 0.2%
Participate in the communal council 16 0.9%
Supporting the government 6 0.3%
Being a member of the ruling party 18 1.0%
Register in the Fatherland System 343 18.6%
Others 5 0.3%
None 1,461 79.1%
Didn’t answer 16 0.9%
Total responses 1,848 100.0%

Recommendations
While the CLAP system has played and can One way to create incentives for the Maduro ad-
continue to play a useful role in alleviating poverty ministration to accept these changes to the program
in the country, several changes to its design would design would be to offer financing for it through
be desirable in order to eliminate or mitigate the one of the several funding sources proposed in this
system’s use as a vehicle for clientelism. work. For example, the CLAP program could be
Among the key problematic elements in the funded through an oil-for-essentials program, as
CLAP design, we note its strong pro-government described in Chapter 3; external resources from
branding and distribution through politicized existing liquid deposits of multilateral financing, as
committees that overrepresent pro-government described in Chapter 4; or even through aid dona-
social organizations. We also believe that increased tions, as described in Chapter 2. A cooperative de-
ownership by diverse political factions of the pro- sign can also benefit the program by incorporating
gram as a state policy, instead of the initiative of a multilateral oversight in procurement and distribu-
single political party, can prove beneficial, especial- tion to avoid slippage to corruption.
ly if combined with an information campaign to
dispel some myths surrounding its conditioning on
voting for the government.
When and Why Negotiations Fail

and What to do About It
The beginning of Venezuela’s crisis – a poorly-pre- sasters,433 but economic collapses in the absence of
pared economy facing an external shock after years these factors are far rarer. The depth of the Venezu-
of mismanagement –conforms with a fairly con- elan economic contraction can only be compared to
ventional pattern of economic crises. However, it episodes involving armed conflicts, which calls for
is difficult to account for the unprecedented depth observers to take a closer look into the case.
of the contraction. The academic literature has Rodríguez (2021c) argues that the Venezuelan cri-
found an unsurprisingly high incidence of growth sis is actually the confluence of two crises. The first
collapses during armed conflict and after natural di- one, which explains the decline in per capita income

during the 2012–16 period, is the standard unrav- exchange rate appreciate significantly while relying
eling of a populist economic cycle, caused by the on state-led rationing to allocate the increasing-
accumulation of macroeconomic distortions rely scarce foreign exchange. Rather than adjust the
sulting from overspending and insufficient savings prices of goods and services provided by the public
during a resource boom. The second one, which sector to the public – such as gasoline – it mon-
accounts for the continuation of the crisis in the etized rising budget deficits, driving the economy
2017–20 period, results from the escalation of po- into hyperinflation. Rather than improve condi-
litical conflict through the adoption of scorched- tions for foreign partners in the oil sector to fund
earth strategies with severe spillover effects on the the investment that PDVSA no longer had the
country’s economy. The first phase of the crisis is money to pay for, the government maintained tight
sufficiently addressed in Chapter 1 and elsewhere controls on the sector, forcing joint venture part-
in the literature; 434 this section instead focuses on ners to sell their dollars into the local market at the
the second phase.435 overvalued official rate, effectively imposing a large
The core idea in Rodríguez (2021c) is that polit- additional tax on their operations.
ical incentives in a zero-sum setup led the Maduro Rodríguez (2023c) highlights the seemingly
administration to make policy choices that contrib- irrational nature of these choices, documenting
uted to worsening the effects of the initial external and discussing several alternative hypotheses on
shock and later resulted in political agents from why the Maduro government made them. In the
both sides of the conflict adopting “scorched earth” author’s view, these apparently-irrational choices
strategies – actions that raise their odds of winning were the result of a short-term bias; in the presence
the contest for power in the short-run at the cost of high-stakes of power – which has been a wide-
of generating long-term productivity losses – that ly-employed characterization of the Venezuelan po-
deepened the collapse and precluded a recovery. litical economy436 – and frequent electoral contests,
In the immediate aftermath of the initial exter- the Maduro administration made policy choices
nal shock, a different policy set – one conformant that provided strong short-term rewards even if at
to the basic policy prescription of conventional a high medium-term cost. This short-term bias is
economics – could have helped Venezuela to nav- a product of the interaction between high-stakes
igate the downturn in oil prices with a smaller eco- winner-takes-all political institutions and the need
nomic contraction and decline in living standards, to frequently measure up in elections.
potentially also averting the worsening of the polit- After the initial external shock and the gov-
ical crisis that came after 2017 and that helped push ernment’s failure to respond to it by conventional
the country into an economic tailspin. means, Venezuela entered a period of continued es-
At that time, rather than devaluing the exchange calation of political conflict that led to the worsen-
rate to create incentives for import substitution ing of the economic collapse after 2017. Escalating
and export production, the government let the real political conflict and poor economic performance

WHEN AND WHY NEGOTIATIONS FAIL AND WHAT TO DO ABOUT IT
often interact through a self-reinforcing, destruc- had severe economic consequences. Buoyed by its
tive feedback loop: political conflict often leads to strong showing and the government’s repressive tac-
short-term bias and the adoption of scorched earth tics, the opposition coalesced around a strategy to
strategies that lead to worse economic outcomes, oust Maduro from office, initially pursued through
while the economic crisis can further raise the a drive to collect signatures for a recall referendum
stakes of power fueling the political conflict. and an international campaign to increase the rep-
As discussed in chapter 3, the evidence shows utational costs of doing business with the Maduro
that economic sanctions, initially deployed by the administration. In December 2016, the opposition
U.S. government in support of a political strategy leadership vowed to repudiate Maduro-issued debt
of the opposition that sought to restrict access to and 2015AN representatives formally asked banks
financing by the Maduro government, significant- not to enter into financing transactions with the
ly impacted the country’s oil production. In con- government or the central bank.
trast to other oil-dependent economies, Venezue- As we noted previously, the political crisis es-
lan growth did not recover as oil prices rose again calated further due to a combination of factors,
in the 2017-19 period to a great degree because including both the open conflict between the su-
sanctions strongly impacted the oil industry, driv- preme court and the 2015AN, and the holding of
ing production into a free fall. Restrictions barring elections under conditions that were not regarded
U.S. entities from extending credit to Venezuela as fair by the opposition and international commu-
as well as an opposition campaign to prevent in- nity, including those held to elect the Constitution-
ternational financing of the Maduro government al Convention and the 2018 presidential elections.
forced the nation into running a current account The escalating legitimacy crisis eventually resulted
surplus of 9% of GDP in 2017 – as opposed to a in dual claims on the presidency that contributed
deficit of 4% of GDP in 2016 – in a desperate at- to isolating the country.
tempt to comply with debt repayments and avoid Venezuela contracted 70% between 2014 and
a default. The result was more import cuts and a 2020. However, two-thirds of the total economic
deeper economic contraction. decline in the full collapse episode occurred between
Economically destructive political conflict only 2017-2020, which saw the economy run four con-
emerges when power is truly contested. This oc- secutive years of double-digit contraction. These oc-
curred in Venezuela after the negative 2014-16 curred precisely at the time in which the economy lost
terms of trade shock significantly lowered the gov- access to international capital and goods markets as its
ernment’s electoral competitiveness, leading to the political crisis worsened, descending into full-fledged
opposition’s resounding victory in the December economically destructive political conflict.
2015 legislative elections – which we covered in the
introductory chapter.
Already at this stage, the growing political crisis

Broadening Political Negotiations
In the last quarter of a century, Venezuela has facilitating political negotiations over zero-sum
started and abandoned 10 negotiations processes outcomes, conventional strategies have missed
without many tangible and long-lasting impro- the forest for the trees.
vements in governance. Recurrent failures of ne- Rodríguez (2023b) argues that Venezuela will
gotiation processes suggest a need to reevaluate likely remain mired in crisis unless the struc-
the underlying reasons impeding their success. In ture of political incentives underlying its con-
our introductory chapter, we already explained flict changes to reduce the stakes of the politi-
Venezuela’s economic crisis as the confluence of cal contest and lower the benefits from pursuing
the effects of an external shock and the intensifi- scorched earth strategies. The author contends
cation of political conflict on a poorly prepared, that growth-inducing policies are not a political
vulnerable economy. Here, we try to identify the equilibrium for Venezuela given the high stakes
structural issues that led to Venezuela’s descent embodied in the country’s structure of political
into political chaos and the channels through competition and that poor policies are less a re-
which this has affected economic outcomes. flection of the convictions of political leaders and
As we argued in the previous pages, political more a reflection of what they feel compelled to
developments since 2017 reflect competition do to survive politically.
in a zero-sum contest for power. When holding One possible solution to this problem would
on to power has such large rewards and losing it be to instead focus on changing the structure of
such high costs, it is unsurprising that political political incentives to reduce the stakes of pow-
agents resort to any available policy tools to se- er and lower the incentives for political actors
cure their grip on power. The same conflict can to continue adopting strategies that damage the
arguably be observed in negotiation processes economy in their fight for power. Rodríguez
attempted so far. Purely political negotiations in (2023b) offers three broad set of initiatives that
a highly polarized environment will often tend could achieve this:
to become zero-sum games. Whenever the nego- •Changing the agenda of negotiations
tiations are strictly about who will hold power, so that it can focus partially or totally on
the opposing sides will naturally be reluctant to different issues from the winner-take-
reach an agreement. all contest for power. For example, this
Most existing attempts at resolving Venezuela’s might entail conducting negotiations on
economic, humanitarian, and political crisis have constitutional reforms, a power-sharing
paid scant attention to the structure of political agreement or sectoral humanitarian
incentives behind it. By focusing on increasing initiatives.
the cost to the government of the status quo or •Change the set of actors involved in the

BROADENING POLITICAL NEGOTIATIONS
discussion either by including more actors ing participation and inclusion, multi-stakeholder
through multi-stakeholder talks or by approaches can also help the negotiations process
reframing intra-coalition competition. gain greater legitimacy in society. Furthermore, by
•Revision of the international including groups that are not directly competing
community’s strategy of sanctions and for political power but have a direct stake in the
economic statecraft or their involvement improvement of economic and social conditions,
in domestic politics to spur growth, the negotiations are more likely to be able to con-
strengthen civil society and facilitate verge to agreements that are positive sum for many
multilateral cooperation. participants. This could also open the way to in-
Rodríguez (2023b) and (2022d) argued that clude other stakeholders that usually lack a voice in
there is reason to question the representativeness political discourse, such as victims of human right
of the mainstream opposition coalition. In the abuses, humanitarian-oriented NGOs and civil so-
2021 regional elections for governors and may- ciety representatives.438
ors, the mainstream opposition coalition (Mesa One common concern is that the multiplicity
de la Unidad Democrática, MUD) only garnered of stakeholders may produce gridlock. This need
42% of the votes that were not cast for the gov- not be the case, if decision rules are designed to
ernment, with the remaining 58% going to non- ensure that participants do not have veto power.439
MUD candidates, most of them from centrist In practice, some groups will inevitably opt out
parties opposed to sanctions. The second largest of the negotiation at one stage of the process, but
opposition coalition, the Democratic Alliance the remaining group of participants may be ample
(Alianza Democrática, Adem) obtained 38% of enough so as to allow the process to be perceived
the opposition vote. as legitimate by most of society. Ideally, the agree-
Perhaps even more importantly, opinion stud- ments reached in any negotiations process would
ies regularly highlight low approval ratings for the be put before voters in a referendum. The participa-
majority of politicians, regardless of what sector of tion of organizations with broad legitimacy among
the government or opposition they belong to. In voters in the negotiations and in the presentation
contrast, the data shows high approval ratings for of the agreement before voters should increase the
broad non-political sectors such as business and likelihood of its subsequent approval.
the Catholic Church. This suggests that a negoti- By offering help in rebuilding the country, the
ation process could gain significantly from includ- international community can also help transform
ing a more ample representation that includes civil the zero-sum game into a positive one. Concrete
society organizations. options in helping to change the structure of the
Multi-stakeholder negotiations have proven suc- political game in Venezuela include a conditional
cessful in tackling complex conflicts such as those of international lifting of sanctions, the recognition
South Africa and Northern Ireland.437 By broaden- of Venezuelan government representatives and

even a broad support package to rebuild the country on a successful agreement in the negotiations.
Table 26. Varieties of initiatives to reduce stakes of power
Reforms Key actors Examples Benefits Risks

Eliminate authority of
Referendum
Constitutional Convention
defeat could
to dissolve branches of
Constitutional reforms deepen
Maduro government. Firmly establish
are difficult to revert. instability.
Constitutional government, supermajority requirements
Approval referendum Constitutional
reforms mainstream for key appointments and
could imply strong court could
opposition organic laws. Guarantee post-
mandate. distort
2024 recognition of heads of
interpretation of
judiciary and accountability
new norms.
branches.
Opposition and experts Facilitates international
Maduro to manage PDVSA, central economic support for
Political
Power-sharing government, bank and finance ministry. economic stabilization
instability and
agreements mainstream Chavismo maintains control and reforms. Lowers risk
policy paralysis.
opposition of national security, interior of post-transition judicial
and foreign affairs ministry. persecution and lawfare.
Maduro
government,
mainstream Expansion of talks to include Increases legitimacy
Multi- Increased chance
opposition, non-mainstream opposition, of talks. Benefits from
stakeholder of negotiations
other labor unions, business credibility of non-political
negotiations gridlock.
opposition associations and church. actors.
groups, civil
society actors
Generates concrete Political actors
Maduro improvements in living could block
government, standards of most implementation if
Oil-for-essentials program. UN-
Sectoral mainstream vulnerable groups. Greater they perceive that
administered social fund using
agreements opposition, willingness of political their opponents
blocked assets.
international actors to cooperate given capture the bulk
organizations separation of sectoral and of the political
political negotiations. benefits.
Spurs economic growth. Likely to be
Unilateral lifting of US
Reforming Economic recovery strongly opposed
United States, economic sanctions. Reforms
sanctions and could strengthen civil by opposition
Europe, United to reduce overcompliance
economic society groups vis-à-vis hardline groups
Nations and increase effectiveness of
statecraft government. Facilitates and their
targeted sanctions.
multilateral coordination. international allies.
Broadens opposiion coa-
Mainstream Hold direct elections for party litions and lowers risks of Likely to be
Reframing intra-
opposition, leaderships. Choose presiden- defection. Moves oppo- resisted by current
opposition
other opposition tial nominee in two-round or sition platform to center, party leaders and
competition
groups second-degree elections. making it more attractive hardline sectors.
to non-aligned voters.
Source. Adapted from Rodríguez (2023b).

Conclusions: Cooperation as a Way Forward
In the previous pages, we discussed the poor about. Rather than seek to provide a way to over-
track record of political negotiations in finding a come the standoff over control of political power
way out of Venezuela’s crisis during the past two between dueling political factions, we argue, ne-
decades. We also argued that this failure should gotiations could be focused on seeking concrete
not come as a surprise. Negotiations work when improvements in Venezuelan living conditions
they help find mutually advantageous arenas of that can be implemented through cooperative
co-operation. In zero-sum political games, such agreements that are reached even in the absence
as those in which parties are fighting over the of a global overarching solution to the conflict
distribution of power or control and the costs of over the legitimacy of political authority.
fighting for the parts in conflict are low, there is Negotiations that aim at cooperating to solve
little to gain from negotiation. In the rare in- specific problems of Venezuelans rather than
stances where parties come to an agreement, it reach a resolution to the country’s political crisis
may be because they have imperfect information are also known as sectoral negotiations. Sectoral
about the actual outcomes; once they find these negotiations are those that have direct value to
out, the party that lost out from a deal will rap- Venezuelans over and above the instrumental use
idly try to go back to the status quo by reneging for solving other problems and thereby may of-
on whatever deal it agreed to. fer tangible spaces for positive-sum interactions.
In contrast, political negotiations can only yield These are distinct from partial agreements,
stable changes from initial conditions if bargaining which are those in which the sphere of negoti-
takes place over a positive-sum structure of payoffs ation only has instrumental value in addressing
and there is a way to make the agreements enforce- a more complex problem. The appointment of
able. For a political negotiation to yield a stable out- electoral authorities would be an example of a
come that is conducive to a political transition in partial agreement, as it has no meaningful di-
Venezuela, that transition must yield improvements rect value to members of society except for its
– or at the very least, avoid deteriorations – relative contribution to a process that does have value
to the status quo for both parts. In chapter 6, we ex- (the capacity to exercise the political freedom
plored one potential avenue for changing the struc- to elect government officials). A humanitarian
ture of the political game by broadening the set of agreement to address food security, in contrast,
political and non-political actors involved in it. is a sectoral agreement in that it solves a specif-
Throughout this volume, we have mapped out ic problem and has value for Venezuelans even if
an alternate vision of what negotiation could be other issues are not addressed.

The fact that sectoral agreements have val- opposition can do with them without cooper-
ue for people in and of themselves implies that ating with Maduro; similarly, there is little that
there are potential gains from the parts to the Maduro can do regarding costly policy interven-
country’s conflict cooperating through them. tions if he doesn’t have access to the funds to pay
For example, political leaders from both factions for them.
that participate in an agreement to provide large It is of course not improbable that a sectoral
scale food assistance and are seen by voters as agreement could end with the sides stuck in ir-
having contributed to solving that problem will reconcilable differences, which in the end are
accumulate important political capital that will reflective of the zero-sum struggle for power.
strengthen their chances to aspiring to import- Both sides are likely to ask themselves how these
ant roles in the future under diverse political sce- agreements will factor into their bid to reach or
narios. It is easier to find immediate gains from maintain their hold on power. If, for example,
cooperation in sectoral agreements than in par- mobilizing resources that help address the hu-
tial or global political agreements, among other manitarian emergency leads to increases in gov-
reasons because they require actors to run much ernment approval, the opposition may conclude
lesser risks and allow them to build up credibility that entering into the deal is a poor choice.
over time in the context of repeated interactions. Sectoral agreements today may neverthe-
For the sides to find that it makes sense to en- less be more feasible than conceptually similar
ter into these sectoral agreements, they must be agreements put forward in the past, as awareness
convinced that they would be unable to address has grown on both sides that definitive victory
the specific problems that the agreements intend by either side in the winner-take-all contest for
to tackle on their own. In other words, there power is unlikely. Sectoral agreements may be
must be genuine gains from co-operation. Inter- more feasible if they count on the support of key
estingly, because of the current structure of con- international actors who could converge under a
straints over control of assets and legal represen- multilateral approach to convince both parts to
tation created by sanctions and non-recognition go along with the solution.
of the government, there are many problems that Building co-operation from the bottom-up
the government and opposition can only solve may not sound like the most ambitious of goals.
cooperatively. Those that require the mobili- Yet by creating institutions that can model
zation of resources – for example, by accessing co-operation and allow new political actors –
blocked funds or oil markets – are completely perhaps less stained by the conflict of the past
intractable in the absence of co-operation. Even years – to emerge, such an approach can begin to
having access to funds deposited in the interna- build a different model through which Venezu-
tional banking system, there is not much that the elans from different sides of the country’s polit-

ical spectrum engage with each other and begin Will such a shared vision ever emerge in conver-
to address their country’s problems. Ultimately, a co- sations between chavista and opposition leaders?
operative vision of society will require mechanisms Perhaps. Perhaps not. Perhaps such prospects may
through which Venezuelans from both camps can have seemed similarly unlikely to observers of the
work together and address the pressing issues of hun- South African crisis in 1989. At the very least, Vene-
ger, disease, and deprivation. zuelans of different political persuasions – and those
In his compelling recounting of the secret talks in the international community who wish to help –
that led to the end of Apartheid, South African phi- should devote efforts to try to establish such com-
losopher Willie Esterhuyse, who acted as a key inter- mon ground. The alternative is the prolongation of
locutor and intermediary in the talks, recalls the piv- a conflict that will continue to destroy the future of
otal moments in which the talks between the South millions of Venezuelans.
African government and leaders of Nelson Mande-
la’s African National Congress (ANC) party took
the turn that would enable them to reach an end to
the deadlock and begin South Africa’s transition to
non-racial, inclusive democracy. He recalls when,
after several meetings between representatives of the
ANC and Afrikaner reformists, the conversations
began to revolve around shared goals:
“I looked at [ANC leaders] Mbeki, Pahad,
Trew, [and Afrikaner representatives] de
Klerk and Terreblanche, and wrote half-
amazed in my notebook: ‘We’re not even
‘friendly enemies’ because we trust each other
with the future even though we have no idea
what it will look like in five or ten years’ time.
We’re sitting here discussing Botha, Mandela,
de Klerk, Tambo, the violence in the country,
the release of political prisoners and negoti-
ations as if we’re playing for the same team.
We accept that our country is being consumed
by conflict, and that a scorched earth is not
in anyone’s interest. And we share words like
‘peace’ and ‘reconciliation’ with each other.’”

Endnotes
411
Rodríguez (2008).
412
Observatorio Visiones (2018).
413
TeleSur (2016).
414
Sistema patria (n.d).
415
Berwick (2018).
416
Hsieh et al. (2011).
417
León (2018).
418
These take the form of either food boxes or bags. The main distinction is that food boxes come pre-packaged from
government suppliers, while food bags tend to be put together by local committees with the items that they receive
from providers.
419
Rubio (2016).
420
Penfold (2018).
421
Rodríguez and Navarro (2018).
422
Primicia (2020) and Ministerio del Poder Popular de Economía, Finanzas y Comercio Exterior (2022).
423
Granados (2021) and Torres (2021).
424
ENCOVI (2017).
Regrettably, the data contradicts that shown above, an example of the inconsistency in results that plague the
425
ENCOVI surveys and cloud their interpretation: while in one table ENCOVI reports that 86% of households
benefit from the CLAP system in another one it states that 19.6% of respondents do not receive CLAP packages. See
ENCOVI (2021) p. 60 for the 86% figure and p. 61 for the 19.6% figure.
426
Our estimate using midpoints of ENCOVI ranges.
427
Obviously, there are also sampling differences and differences in the actual question asked. ENCOVI asks about
the frequency during which respondents have received packages during the last 12 months, while Datanálisis asks
respondents whether they receive packages, and whether they have received them during the past month.
428
As is common practice among survey firms, Datanálisis groups respondents by socio-economic status, grouping
them into five classes, labelled A-E based on data on income and education. Given that A and B account for a negli-
gible fraction of Venezuela’s population, the firm only surveys respondents in classes C, D and E.
429
As described above, CLAP access is universal but conditional on a CLAP being organized and boxes arriving in
the community, with some families in greater need receiving more boxes. The right to a Fatherland Card is universal
yet bonuses are sometimes targeted to specific socioeconomic groups.
430
See Solís et al (2021). In Colombia – the only Latin American country in the sample, respondents with more than
secondary education were significantly more likely to accept a vaccine than those with less than secondary education,
though the difference (78 vs 73 percent) was not high in absolute terms.
431
Infobae (2021) and Lozano (2021b).
432
El Pitazo (2021).

433
Other key findings are that the likelihood of shocks causing collapses depends on a country’s degree of deve-
lopment. In developing countries, negative shocks on exports, either on production, demand, or prices, are closely
related to the incidence of collapses, as well as shocks affecting the country’s terms of trade. For emerging markets,
financial shocks – such as sudden stops on capital flows – are closely related to collapses (Becker and Mauro, 2006;
Hausmann et al. 2006). Other drivers discussed in the literature are high dependence on primary exports, misma-
nagement of natural resource rents, debt crises, weak conflict management institutions, political transitions, export
sector’s inability to rapidly adapt, and location (Rodrik, 1999; Cerra and Saxena, 2008; Reddy and Minoiu, 2009;
IMF, 2018; Meneses and Saboín, 2021).
434
See Rodríguez and Guerrero (2020).
435
For a more thorough discussion of the toxification of Venezuelan politics and its impact on economic outcomes
see Rodríguez and Imam (2022), Rodríguez (2021c) and Rodríguez (2023b).
436
Monaldi and Penfold (2012).
437
Mnookin (2003), Hancock (2008), Berman and Abdollahian (1999).
438
Lowering stakes of power may also make positive-sum agreements more feasible. Rodríguez and Imam (2022)
and Rodríguez (2023b) show that high stakes of power can lead political actors to adoprt scorched-earth strategies
that produce severe negative externalities on the rest of society. Lower stakes of power may thus induce these same
actors to choose to abide by binding institutional and constitutional constraints and to abandon these scorched-earth
strategies.
439
Austen-Smith et al. (2019).

References
Abuelafia, E., & Saboin, J. L. (2020). Una mirada a fu- Economic Sanctions on Income Inequality of Target
turo para Venezuela. Inter-American Development States. World Development, 83, 1–11.
Bank. Discussion Paper N° IDB-DP-798 http://dx- Agencias. (2022, August 23). Bloomberg: Venezue-
.doi.org/10.18235/0002621 la contrata a Siemens para reconstruir red eléctrica
Acción Democrática. (2022, September 22). Bernabé en ruinas. Tal Cual. https://talcualdigital.com/
Gutiérrez: En AD si queremos elecciones primarias pero bloomberg-venezuela-contrata-a-siemens-para-re-
con la participación de todas las organizaciones políti- construir-red-electrica-en-ruinas/
cas sin exclusión [Press release]. https://ademocratica. Al Jazeera. (2020, June 3). Venezuela’s Maduro joins
com/2022/09/22/bernabe-gutierrezen-ad-si-quer- hands with Guaido in fight against virus. Al Ja-
emos-elecciones-primarias-pero-con-la-participa- zeera. https://www.aljazeera.com/news/2020/6/3/
cion-de-todas-las-organizaciones-politicas-sin-ex- ven e zu e la s -ma duro - j o ins ha n d s -wi th- g ua i -
clusion/ do-in-fight-against-virus
Acemoglu, D., & Robinson, J. A. (2019). The narrow Alcalde, C. (2022, July 13). “Es una tragedia la que es-
corridor: states, societies, and the fate of liberty. Pen- tamos viviendo,” el drama de obtener un pasaporte
guin Press. venezolano. VOA News. https://www.vozdeam-
Aceris Law LLC. (2020, February 18). Sovereign Im- erica.com/a/es-una-tragedia-que-estamos-vivien-
munity from Jurisdiction in International do-el-drama-de-obtener-un-pasaporte-venezola-
Arbitration. Aceris Law LLC. https://www.acerislaw. no/6656675.html
com/sovereign-immunity-from-jurisdiction-in-in- Allen, S. H., & Lektzian, D. J. (2013). Econom-
ternational-arbitration/ ic sanctions: A blunt instrument?. Journal of
Ackerman, S. (2022, September 19). U.S. Rejected Tali- Peace Research, 50(1), 121–135. https://doi.
ban Seat on Board of Fund Controlling Afghanistan’s org/10.1177/0022343312456224
Wealth. Forever Wars by Spencer Ackerman. https:// Alvarado, A. [@AngelAlvaradoR] (2020, March 2).
foreverwars.ghost.io/u-s-rejected-taliban-seat-on- Siguen los maquillajes de balance en @AgendaCAF
board-of-fund-controlling-afghanistans-wealth/ Pretenden que mañana en el directorio venda sus ac-
Asamblea Nacional de la República Bolivariana de Ven- ciones en la Corporación para evitar otra vez la cesación
ezuela (2019, February 19). Acuerdo para la Autor- de pagos. Señor Carranza, haga lo que corresponde: de-
ización de Ingreso al País de la Ayuda Humanitar- clare la cesación de pagos y reestructuremos la deuda.
ia. https://www.asambleanacionalvenezuela.org/ [Tweet]. Twitter. https://twitter.com/AngelAlvara-
actos/detalle/acuerdo-para-la-autorizacion-de-in- doR/status/1234559010029948935
gresoal-pais-de-la-ayuda-humanitaria-351 Alvarez, J. A., Arena, M., Brousseau, A., Faruqee, H.,
Afesorgbor, S., & Mahadevan, R. (2016). The Impact of Fernandez, E. W., Guajardo, J., Peraza, G. & Yepez, J.
214
(2022). Regional Spillovers from the Venezuelan Cri- com/a/americas_diesel-shortage-raises-fears-hu-
sis: Migration Flows and Their Impact on Latin Amer- manitarian-crisis-venezuela/6201835.html
ica and the Caribbean. International Monetary Fund. Asamblea Nacional [@AsambleaVE]. (2019a, Janu-
https://www.imf.org/en/Publications/Departmen- ary 10). Pronunciamiento de la junta directiva de la
tal-Papers-Policy-Papers/Issues/2022/12/01/Re- #AsambleaVe al país y toda la Comunidad Interna-
gional-Spillovers-from-the-Venezuelan-Crisis-Mi- cional [Tweet]. Twitter. https://twitter.com/Asam-
grationFlows-and-Their-Impact-on-Latin-525729 bleaVE/status/1083435678715785216
Antolínez, H. (2023, January 10). En Alianza Asamblea Nacional. (2019b, November 27). Nora Bra-
Democrática dan casi como un hecho la no partici- cho: Trabajamos juntos la CAF y PNUD en un proyec-
pación en la primaria. Crónica uno. https://cronica. to legal para atender la crisis eléctrica del país [Press
uno/en-alianza-democratica-dan-casi-como-un- release]. https://www.asambleanacionalvenezuela.
hecho-la-no-participacion-en-la-primaria/ org/noticias/nora-bracho-trabajamos-juntos-la-caf-
Arena, M., Fernandez, E., Guajardo, J. & Yepez, J. F. y-pnud-en-un-proyecto-legal-para-atender-la-crisis-
(2022, December 7). Venezuela’s Migrants Bring electrica-del-pais
Economic Opportunity to Latin America. IMF Coun- Asamblea Nacional. (2019c). Guidelines for the renegoti-
try Focus. https://www.imf.org/en/News/Arti- ation of the Chávez/Maduro era legacy public external
cles/2022/12/06/cf-venezuelas-migrants-bring-eco- debt [White Paper]. Asamblea Nacional. https://
nomic-opportunity-to-latin-america www.creditslips.org/files/wp-deuda-oper-eng.pdf
Argus Media. (2018, January 11). Oil seizure aggravates Atlantic Council (2022a). Exploring humanitarian
Venezuela-Carib tensions. Argus Media. https:// frameworks for Venezuela [White Paper]. Atlantic
www.argusmedia.com/es/news/1605857-oil-sei- Council. https://www.atlanticcouncil.org/in-depth-
zure-aggravates-venezuelacarib-tensions?amp= research-reports/report/exploring-humanitari-
Armas, M., & Buitrago, D. (2023). Venezuela expects an-frameworks-for-venezuela/
to sign gas licenses by year-end, oil minister says. Atlantic Council Experts. (2022b, November 27). Ex-
Reuters. https://www.reuters.com/business/energy/ perts react: As the US eases oil sanctions, is Venezuela
venezuela-expects-sign-gas-licenses-by-year-end-oil- coming in from the cold? Atlantic Council. https://
minister-2023-07-21/ www.atlanticcouncil.org/blogs/new-atlanticist/
Armas, M. (2022, December 30). Venezuela opposi- us-eases-oil-sanctions-venezuela-chevron-maduro/
tion removes interim President Guaido. Reuters. Auty, R. M (2001). Resource Abundance and Economic
https://www.reuters.com/world/americas/vene- Development. Oxford University Press.
zuela-opposition-removes-interim-president-guai- Austen-Smith, D., Dziuda, W., Harstad, B. & Loeper, A.
do-2022-12-31/ (2019). Gridlock and inefficient policy instruments.
Arredondo, A., & Ocando, G. (2021, February 9). Die- Theoretical Economics, Econometric Society, 14(4).
sel Shortage Raises Fears for Humanitarian Crisis https://ideas.repec.org/a/the/publsh/3329.html
in Venezuela. VOA News. https://www.voanews. Bahar, D., Bustos, S., Morales, J. R., & Santos, M. A. (2019).
215
Impact of the 2017 sanctions on Venezuela: Revisit- 53(4), 1075 – 1094. http://www.jstor.org/sta-
ing the evidence. Brookings Institution. https://www. ble/27735136
brookings.edu/wp-content/uploads/2019/05/im- BBC News. (2019a, February 24). Venezuela crisis:
pact-of-the-2017-sanctions-on-venezuela_final.pdf Deadly border clashes as Maduro blocks aid. BBC
Bahar, D., Dooley, M., & Selee, A. (2020). Venezue- News. https://www.bbc.com/news/world-lat-
lan migration, crime, and misperceptions: A review in-america-47346253
of data from Colombia, Peru, and Chile. Brookings BBC News. (2019b, April 17). Venezuelans receive first
Institute. https://www.brookings.edu/research/ven- Red Cross aid amid crisis. BBC News. https://www.
ezuelan-migration-crime-and-misperceptions-a-re- bbc.com/news/world-latin-america-47960734
view-of-data-from-colombia-peru-and-chile/ BBC News Mundo. (2017, August 25). Estados Uni-
Bahar, D. & Rapoport, H. (2018). Migration, Knowl- dos impone por primera vez sanciones financieras
edge Diffusion and the Comparative Advantage of contra el gobierno de Nicolás Maduro en Venezue-
Nations. The Economic Journal, 128(612), 273-305. la. BBC News. https://www.bbc.com/mundo/noti-
https://doi.org/10.1111/ecoj.12450 cias-america-latina-41055728
Banca y Negocios. (2022a, April 19). Refuerzan pa- BBC News Mundo. (2020, October 9). Aprueban en
trullaje militar en instalaciones eléctricas luego de Venezuela la “Ley Antibloqueo” con la que Maduro
apagones en 10 estados. Banca y Negocios. https:// tendrá plenos poderes para firmar nuevos negocios
www.bancaynegocios.com/refuerzan-patrulla- petroleros. BBC News Mundo. https://www.bbc.
je-militar-en-instalaciones-electricas-luego-de-apa- com/mundo/noticias-america-latina-54478149
gones-en-10-estados/ Becker, T., & Mauro, P. (2006). Output Drops and the
Banca y Negocios (2022b, November 26). Gobier- Shocks That Matter. International Monetary Fund.
no y oposición acuerdan fondo humanitario por https://www.imf.org/external/pubs/ft/wp/2006/
más de US$ 3.000 millones avalado por la ONU. wp06172.pdf
Banca y Negocios. https://www.bancaynegocios. Berman, D., & Abdollahian, A. (1999). Negotiating the
com/gobierno-y-oposicion-acuerdan-fondo-hu- Peaceful Expansion of the South African Electorate.
manitario-por-mas-de-us-3-000-millones-avala- Journal of Conflict Resolution, Peace Science Society
do-por-la-onu/ (International), 43(2), 229-244. https://ideas.repec.
Banco Central de Venezuela ad hoc. (2023). Balance org/a/sae/jocore/v43y1999i2p229-244.html
General. BCV ad hoc. https://www.bcvadhoc.com/ Bertorelli, J. R. (2022, August 28). Entrevista a José
estados-financieros María de Viana: “nunca debe otorgarse un contrato
Banco Central de Venezuela v. Juan Guaidó. 941 F.3d tan grande a una sola empresa”. Somos tu voz. https://
111. (2nd Cir. 2019). somostuvoz.net/entrevista-a-jose-maria-de-viana-
Bapat, N., & Morgan, C. (2009). Multilateral versus nunca-debe-otorgarse-un-contrato-tan-grande-a-
Unilateral Sanctions Reconsidered: A Test Us- una-sola-empresa/
ing New Data. International Studies Quarterly, Berwick, A. (2018, November 14). How ZTE helps
216
Venezuela create China-style social control. Reuters. search/recognition-and-the-taliban-2/
https://www.reuters.com/investigates/special-re- Brunk, I. (2018). Immunity from Execution of Cen-
port/venezuela-zte/ tral Bank Assets. In T. Ruys, N. Angelet, & L. Ferro
Bierstecker, T. & Hudáková, Z. (2015). UN sanctions (Eds.) The Cambridge Handbook of Immunities and
and peace negotiations: possibilities for complemen- International Law (pp. 18 – 24). Cambridge.
tarity. Centre for Humanitarian Dialogue. https:// Buchheit, L., & Mitu, G. (2018). Sovereign Debt Re-
hdcentre.org/insights/un-sanctions-and-peace-ne- structuring and U.S. Executive Power). Capital Mar-
gotiations-possibilities-for-complementarity/ kets Law Journal (Forthcoming), 55. https://ssrn.
Biersteker, T. J., Eckert, S. E., Tourinho, M., & Hudáková, com/abstract=3243663
Z. (2018). UN targeted sanctions datasets (1991– Buitrago, D. (2023). Venezuela corruption probe snares
2013) [Data set]. Journal of Peace Research, 55(3), another former top PDVSA executive. Reuters.
404–412. https://www.jstor.org/stable/48595892 https://www.reuters.com/world/americas/venezue-
Blum, J. (2021, January 15). CITGO still in limbo as la-corruption-probe-snares-another-former-top-pd-
judge approves sale of Venezuelan holding company’s vsa-executive-2023-04-19/
shares. SandP Global Commodity Insights. https:// Byrd, W. (2022a, August 15). Demands for Prompt Re-
www.spglobal.com/commodityinsights/en/mar- turn of Afghan Central Bank Reserves Miss the Full
ket-insights/latest-news/oil/011521-CITGO-still- Picture. United States Institute of Peace. https://www.
in-limbo-as-judge-approves-sale-of-venezuelan- usip.org/publications/2022/08/demands-prompt-
holding-companys-shares return-afghan-central-bank-reserves-miss-full-pic-
Bracci, L. (2021, March 24). Guaidó bloqueó recursos de ture
Venezuela para compra de vacunas: Delcy Rodríguez Byrd, W. (2022b, September 28). U.S. to Move Afghan-
solicita investigarlo [Video]. YouTube. https://www. istan’s Frozen Central Bank Reserves to Swiss Fund.
youtube.com/watch?v=pdjIqRYeEtc United States Institute of Peace. https://www.usip.
Brewer-Carías. A. (2022). La reforma del estatuto de org/publications/2022/09/us-move-afghanistans-
transición a la democracia para asegurar, a partir del frozen-central-bank-reserves-new-swiss-fund
5 de enero de 2022, la continuidad institucional de Caballero v. Fuerzas Armadas Revolucionarias de Co-
la asamblea nacional electa en 2015 y del presidente lom., 579 F. Supp. 3d 315 (D. Conn. 2022). https://
encargado. Vicisitudes de una reforma. In A. Brew- casetext.com/case/caballero-v-fuerzas-armadas-rev-
er-Carías, Comentarios constitucionales sobre una olucionarias-de-colom-5
transición hacia la democracia que no fue 2019-2023 CAF - Development Bank of Latin America. (2020,
(pp. 368-382). Academia de Ciencias Políticas y So- August 3). IADB, CAF, and FONPLATA Launch
ciales. Alliance for Regional Integration. https://www.
Brookings. (2022, September 30). Recognition and iadb.org/en/news/idb-caf-fonplata-launch-alli-
the Taliban. Session 15 of the Congressional Study ance-regional-integration#:~:text=The%20Inter%-
Group. Brookings. https://www.brookings.edu/re- 2DAmerican%20Development%20Bank,and%20
217
generate%20knowledge%20and%20applied la emergencia humanitaria compleja: Respuesta Hu-
CAF - Development Bank of Latin America. (2022, manitaria, Desafíos para la Sociedad Civil [White pa-
July 6). ONU en Venezuela y CAF firman acuerdo de per]. WOLA. https://www.wola.org/wp-content/
colaboración. Corporación Andina de Fomento [Press uploads/2020/11/Informe-de-Vanessa-Cartaya-1.
release]. https://www.caf.com/es/actualidad/noti- pdf
cias/2022/07/onu-en-venezuela-y-caf-firman-acuer- Caruso, G., Gómez, C., & Mueller, V. (2019). Spillover
do-de-colaboracion effects of the Venezuelan crisis: migration impacts
CAF - Development Bank of Latin America. (2023). in Colombia. Oxford Economic Papers, (pp. 1-25).
Financial Statements. CAF. https://www.caf.com/ https://doi.org/10.1093/oep/gpz072
media/4384356/cafannualingle-s31-12-2022conin- CBS Miami Team. (2022, September 15). Gov. De-
formedelosauditoresindependientes.pdf Santis defends decision to fly migrants to Mar-
Cagan (1956). The Monetary Dynamics of Hyperinfla- tha’s Vineyard: ‘We’re not a sanctuary state’. CBS
tion. In: Friedman, M., Ed., Studies in Quantity The- News. https://www.cbsnews.com/miami/news/
ory of Money. The University of Chicago Press, (pp. south-florida-venezuelans-slam-desantis-administra-
25-117). tion-for-flying-migrants-to-marthas-vineyard/
Campo, F., Fuerte, G. & Portes, J. (2018). The Im- Center for Disaster Philanthropy. (2022). The Dan-
pact of Migration on Productivity and Native-Born gers of Forced Displacement: Chronic and Emerging
Workers’ Training. IZA Institute of Labor Econom- Health Needs of Displaced Venezuelans in the Amer-
ics, 11833. https://papers.ssrn.com/sol3/papers. icas Region [White Paper]. Simón Bolivar Founda-
cfm?abstract_id=3261692 tion. https://www.simonbolivarfoundation.org/
Campos, R., & Lawder, D. (2019, April 11). Venezue- presentations/2022REVISEDVenezuelanMigra-
la leadership issue still blocking IMF, World Bank tionChronic%20EmergingHealthNeeds.pdf
aid. Reuters. https://www.reuters.com/article/ Cerra, V., & Saxena, S. (2008). Growth Dynamics: The
us-imf-worldbank-venezuela-idUSKCN1RN1TH Myth of Economic Recovery. International Monetary
Cancillería de la República de Ecuador. (2018, Septem- Fund.
ber 4). Declaración de Quito sobre Movilidad Huma- Chevron. (2021). 2021 supplement to the annual re-
na de ciudadanos venezolanos en la Región [Press report. Chevron. https://www.chevron.com/-/media/
lease]. https://www.cancilleria.gob.ec/2018/09/04/ shared-media/documents/2021-chevron-annual-re-
declaracion-de-quito-sobre-movilidad-huma- port-supplement.pdf
na-de-ciudadanos-venezolanos-en-la-region/ Choi, S., & Luo, S. (2013). Economic Sanctions, Pov-
Caritas (2021). Monitoreo Centinela de la Desnutrición erty, and International Terrorism: An Empirical
Infantil: VENEZUELA. Caritas. https://caritasven- Analysis. International Interactions, 39(2), 217–245.
ezuela.org/wp-content/uploads/sites/6/2022/04/ https://whanchoi.people.uic.edu/Economic-Sanc-
BOLETIN-SAMAN-CARITASVZLA-2021.pdf tions-Poverty-and-International-Terrorism.pdf
Cartaya, V., Reyna, F., & Ramsey G. (2020). Venezue- CITGO. (2022a, March 31). CITGO Enters 2022 With
218
Strong Momentum [Press release]. https://www. CITGO. (2023, March 9). CITGO Reports Fourth
CITGO.com/newsroom/press-releases/2022/CIT- Quarter and Full-Year 2022 Results [Press release].
GO-enters-2022-with-strong-momentum https://www.CITGO.com/newsroom/press-releas-
CITGO. (2022b, May 17). CITGO Reports First Quar- es/2023/CITGO-reports-fourth-quarter-and-full-
ter 2022 Results [Press release]. https://www.CIT- year-2022-results
GO.com/newsroom/press-releases/2022/CITGO- Cohen, L. (2021, May 19). Diesel shortages paralyze
reports-first-quarter-2022-results Venezuelan farms, prompting sanctions debate. Re-
CITGO. (2022c, August 11). CITGO Reports Second uters. https://www.reuters.com/world/americas/
Quarter 2022 Results [Press release]. https://www. diesel-shortages-paralyze-venezuelan-farms-prompt-
CITGO.com/newsroom/press-releases/2022/CIT- ing-sanctions-debate-2021-05-19/
GO-reports-second-quarter-2022-results Cohen, L., & Stempel, J. (2019). Court ruling against
CITGO. (2022d, September 9). CITGO holding, inc. Venezuela in Crystallex case puts CITGO at risk.
announces the expiration and final results of offer to Reuters. https://www.reuters.com/article/venezue-
purchase up to $286.231 million in aggregate princi- la-pdvsa-crystallex-idUSL2N24U0GA
pal amount of its 9.25% senior secured notes due 2024 Cohen, L., Parraga, M., & Stempel, J. (2019). U.S. court
[Press release]. https://www.CITGO.com/news- rules against Maduro bid to oust opposition-backed
room/press-releases/2022/CITGO-holding-inc- CITGO board. Reuters. https://www.reuters.
announces-the-expiration-and-final-results-of-offer- com/article/venezuela-CITGO-court-idUSL-
to-purchase-up-to-286-231-m 2N24Z04D
CITGO. (2022e, November 10). CITGO Reports Third Constitución de la República Bolivariana de Venezuela.
Quarter 2022 Results [Press release]. https://www. Art 195. 1999 (Venezuela)
CITGO.com/newsroom/press-releases/2022/CIT- Constitución de la República Bolivariana de Venezuela.
GO-reports-third-quarter-2022-results Art 196. 1999 (Venezuela)
CITGO. (2022f, November 17). Simon Bolivar Foun- ConocoPhillips. (2021). ConocoPhillips 2021 Annual
dation announces support for health programs for Report. ConocoPhillips. https://static.conocophil-
Venezuelan and other migrants in Colombia, Ecua- lips.com/files/resources/conocophillips-2021-an-
dor and Peru [Press release]. https://www.CITGO. nual-report.pdf
com/newsroom/press-releases/2022/simon-boli- ConocoPhillips Gulf of Paria v. Corporación Venezola-
var-foundation-announces-support-for-health-pro- na de Petróleo. Case No. 22-mc-00264-LPS. (2022).
grams-for-venezuelan-and-other-migrants-in Cornell Law School. (n.d.). Alter ego. In Cornell Law
CITGO. (2022g, December 21). CITGO petroleum School. Retrieved March 23, 2023, from https://
announces full repayment of term loan [Press release]. www.law.cornell.edu/wex/alter_ego#:~:tex-
https://www.CITGO.com/newsroom/press-releas- t=Alter%20ego%20is%20a%20legal,respect%20
es/2022/CITGO-petroleum-announces-full-repay- to%20their%20limited%20liability
ment-of-term-loan Correlates of War. (n.d). About the Correlates of War
219
Project. COW. https://correlatesofwar.org/ Venezuela and Petróleos de Venezuela SA, (Case 18-
Cortright, D., & Lopez, G. (2000a). The Limits of Co- 2797). (3th Cir. 2019). U.S. Third Circuit Court of
ercion. Bulletin of the Atomic Scientists, 56(6), 18-20. Appeals, Opinion of the Court.
Cortright, D., & Lopez, G. (2000b). The Sanctions De- Crystallex International Corp. v Bolivarian Republic
cade: Assessing UN Strategies in the 1990s. Lynne Ri- of Venezuela and Petróleos de Venezuela SA, Case
enner Publishers. 1:17-mc-00151-LPS (D.l. No. 258). (3th Cir. 2022).
Cortright, D., & Lopez, G. (2002). Smart Sanctions: U.S. Third Circuit Court of Appeals, Opinion of the
Targeting Economic Statecraft. Rowman and Little- Court.
field Publishers. Crystallex International Corp. v Bolivarian Republic
Council of the European Union. (2021). Council con- of Venezuela and Petróleos de Venezuela SA (Case
clusions on Venezuela (25 January 2021). General 18-2797). (2023a). Special Master’s Supplemental
Secretariat of the Council. https://www.consilium. Report and recommendation pursuant to sale pro-
europa.eu/media/48053/st05582-en21.pdf cedures order.
Croft, J., & Long, G. (2020, May 20). Venezuela sues Crystallex International Corp. v Bolivarian Republic of
Bank of England over refusal to release gold. Finan- Venezuela and Petróleos de Venezuela SA (Case 18-
cial Times. https://www.ft.com/content/b03977ed- 2797). (2023b). Memorandum Order, May 4.
4f69-4e55-a3b6-77a8befdd5f3 Da Afghanistan Bank. (n.d). Supreme Council. DAB.
Crystal, C. (2023). Landmark UN Humanitarian Sanc- https://www.dab.gov.af/supreme-council2
tions Exemption Is a Massive Win but Needs More Sup- Dai, M., Felbermayr, G., Kirilakha, ASyropoulos, C.,
port. Carnegie Endowment For International Peace. Yalcin, E., &Yotov, Y. (2021). Timing the Impact of
https://carnegieendowment.org/2023/03/20/land- Sanctions on Trade. In Cheltenham (Ed), Research
mark-un-humanitarian-sanctions-exemption-is-mas- Handbook on Economic Sanctions. Edward Elgar
sive-win-but-needs-more-support-pub-89311 Publishing Limited.
Crystallex International Corporation v. Bolivari- Dashti-Gibson, J., Davis, P., & Radcliff, B. (1997).
an Republic of Venezuela. ICSID Case No. AR- On the Determinants of the Success of Economic
B(AF)/11/2. (2011). https://investmentpolicy.unc- Sanctions: An Empirical Analysis. American Jour-
tad.org/investment-dispute-settlement/cases/403/ nal of Political Science, 41(2), 608–618. https://doi.
crystallex-v-venezuela org/10.2307/2111779
Crystallex International Corp. v Bolivarian Republic of Dawi, A. (2022, October 12). Uncertainty Sur-
Venezuela, (Case1:16-cv-00661-RC). (2017). Mem- rounds Billions of Dollars in Afghanistan’s Funds.
orandum opinion. VOA News. https://www.voanews.com/a/uncer-
Crystallex International Corp. v. Bolivarian Republic of tainty-surrounds-billions-of-dollars-in-afghani-
Venezuela, (Case No. 19-1049), (S.C. 2020). Certio- stan-s-funds-/6786856.html
rari Denied. Dayanim, B., & Morris, C. (n.d). United States Sanc-
Crystallex International Corp. v Bolivarian Republic of tions: General Considerations for Minority Invest-
220
ment. Paul Hastings. https://webstorage.paulhast- EWCA 1249. (2020b). https://jusmundi.com/
ings.com/Documents/PDFs/1676.pdf en/document/decision/en-deutsche-bank-v-vene-
De Jesus, L. (2023, May 30). Primero Justicia negó zuelan-central-bank-bcv-judgment-of-the-united-
afirmaciones de Yon Goicoechea y pidió a EE UU kingdom-court-of-appeal-2020-ewca-1249-mon-
extender la protección de CITGO. El Nacional. day-5th-october-2020#decision_12538Deutsche
https://www.elnacional.com/venezuela/primero- Bank v. Venezuelan Central Bank (BCV). UKSC
justicia-nego-afirmaciones-de-yon-goicoechea-y-pi- 57. (2021). https://jusmundi.com/en/document/
dio-a-ee-uu-extender-la-proteccion-de-CITGO/ decision/en-deutsche-bank-v-venezuelan-central-
Delgado, M. (2020). Does immigrant diversity affect pro- bank-bcv-judgment-of-the-united-kingdom-su-
ductivity? The Spanish experience (Publication No. preme-court-2021-uksc-57-monday-20th-decem-
286) [Bachelor Thesis, Universitat Jaume I]. Depar- ber-2021#decision_18854
tament of Economics. http://repositori.uji.es/xm- Deutsche Bank v. Venezuelan Central Bank (BCV).
lui/handle/10234/175555 EWHC 2040. (2022a). https://jusmundi.com/en/
Deloitte. (n.d). Estados Financieros Por los años ter- document/decision/en-deutsche-bank-v-venezue-
minados el 31 de diciembre de 2021 y 2020. Corpo- lan-central-bank-bcv-judgment-of-the-high-court-
ración Andina de Fomento (CAF). of-justice-of-england-and-wales-2022-ewhc-2040-
Deniz, R. (2017, April 23). Empresarios cuestio- friday-29th-july-2022#decision_26293
nados en Ecuador y EEUU le venden comida al Deutsche Bank v. Venezuelan Central Bank (BCV).
gobierno venezolano. ArmandoInfo. https://ar- EWHC 2702. (2022b). https://jusmundi.com/en/
mando.info/empresarios-cuestionados-en-ecua- document/decision/en-deutsche-bank-v-venezue-
dor-y-eeuu-le-venden-comida-al-gobierno-venezola- lan-central-bank-bcv-judgment-of-the-high-court-
no/ of-justice-of-england-and-wales-2022-ewhc-2702-
Department of Homeland Security (2022, October monday-12th-september-2022#decision_44748
12). DHS Announces New Migration Enforcement Deutsche Bank v. Venezuelan Central Bank (BCV).
Process for Venezuelans [Press release]. Department EWHC 2040. (2022c). https://www.judiciary.uk/
of Homeland Security. https://www.dhs.gov/ wp-content/uploads/2022/07/DB-Venezuela-fi-
news/2022/10/12/dhs-announces-new-migra- nal-for-hand-down-290722.pdf
tion-enforcement-process-venezuelans Diario El Universal. (2023, May 15). Presidente Mad-
Deutsche Bank v. Venezuelan Central Bank (BCV). uro acusó de la retención de CITGO a precandi-
EWHC 1721. (2020a). https://jusmundi.com/en/ datos presidenciales de la oposición. El Universal.
document/decision/en-deutsche-bank-v-venezue- https://www.eluniversal.com/politica/155427/
lan-central-bank-bcv-judgment-of-the-high-court- presidente-maduro-acuso-de-la-retencion-de-CIT-
of-justice-of-england-and-wales-2020-ewhc-1721- GO-a-precandidatos-presidenciales-de-la-oposicion
thursday-2nd-july-2020#decision_12537 Discusión Proyecto Reforma Estatuto para La tran-
Deutsche Bank v. Venezuelan Central Bank (BCV). sición. 030121. December 31, 2022. (Venezuela).
221
Docquier, F., Ozden, C., & Peri, G. (2014). The La- cial-aprobado-en-mexico/
bour Market Effects of Immigration and Emi- El Pitazo (2023, May 14). Horacio Medina: no es que
gration in OECD Countries. Economic Journal, CITGO estaba en riesgo de perderse, estaba perdido
124(579),1106–1145. doi:10.1111/ecoj.12077 en 2019. El Pitazo. https://elpitazo.net/entrevistas/
Donn, N. (2022, March 3). Novo Banco lets courts horacio-medina-no-es-que-CITGO-este-en-riesgo-
decide who Venezuela’s €1.5 billion belongs to. Por- de-perderse-estaba-perdida-en-2019/
tugal resident. https://www.portugalresident.com/ Embajada de México en Venezuela (2023, January 20).
novo-banco-lets-courts-decide-who-venezuelas-e1- Visas. Relaciones Exteriores. Secretaria de Relaciones
5-billion-belongs-to/ Exteriores. https://embamex.sre.gob.mx/venezuela/
Doocy, S., Page, K., & De la Hoz, F. (2019). Ven- index.php/servicios-consulares/visas
ezuelan Migration and the Border Health Cri- Encuesta de Condiciones de Vida ENCOVI. (2022,
sis in Colombia and Brazil. Journal on Migration November). Condiciones de vida de los venezolanos
and Human Security, 7(3), 79–91. https://doi. 2022. Universidad Católica Andrés Bello. https://
org/10.1177/2331502419860138 assets.website-files.com/5d14c6a5c4ad42a4e794d-
Dorante, C. (2021, March 5). REDD Latam: Víctimas 0f7/636d0009b0c59ebfd2f24acd_Presenta-
de las Farc podrían incautar activos de Venezuela en cion%20ENCOVI%202022%20completa.pdf
EE. UU. El Pitazo. https://elpitazo.net/internacio- Eni. (2022). Eni Annual Report 2021. Eni. https://www.
nal/redd-latam-victimas-de-las-farc-podrian-incau- eni.com/assets/documents/eng/reports/2022/An-
tar-activos-de-venezuela-en-ee-uu/ nual-Report-2022.pdf
Drezner, D. (2000). Bargaining, Enforcement, and Equipo Anova. (2021). Impacto de las Sanciones Finan-
Multilateral Sanctions: When Is Cooperation Coun- cieras Internacionales contra Venezuela: Nueva Evi-
terproductive?. International Organization, 54(1), dencia. 3(1), 1 – 3.
709–731. Escribà-Folch, A., & J. Wright. (2010). Dealing with
Drezner, D. (2003). The Hidden Hand of Economic Tyranny: International Sanctions and the Survival
Coercion. International Organization, 57(3), 643– of Authoritarian Rulers.” International Studies Quar-
659. terly, 54(2), 335–359.
DW. (2018, July 22). Maduro acusa a EE.UU. y a la UE Esra, Y., & Andrew, W. (2022, September 20). Waiv-
de retener dinero venezolano. DW. https://www. er of Immunity from Execution. Jus Mundi. https://
dw.com/es/maduro-acusa-a-eeuu-y-a-la-ue-de-re- jusmundi.com/en/document/publication/en-waiv-
tener-dinero-venezolano/a-44775920 er-of-immunity-from-execution
Efecto Cocuyo (2023, May 29). Jorge Rodríguez European Council of the European Union. (2019, Jan-
asegura que James Story impidió crear fondo so- uary 23). Declaration by the High Representative on
cial aprobado en México. Efecto Cocuyo. https:// behalf of the European Union on latest developments
efectococuyo.com/politica/jorge-rodriguez-ase- in Venezuela [Press Release]. https://www.consili-
gura-que-james-story-impidio-crear-fondo-so- um.europa.eu/en/press/press-releases/2019/01/23/
222
declaration-by-the-high-representative-on-be- Nations. https://www.fao.org/in-action/voices-of-
half-of-the-european-union-on-latest-develop- the-hungry/fies/en/
ments-in-venezuela/ FAO. (2023). The Bolivarian Republic of Venezuela: Hu-
Exceptions to the immunity from attachment or exe- manitarian Response Plan 2022-2023. FAO. https://
cution, 28 U.S. Code § 1610 (2008). https://www. www.fao.org/3/cc6775en/cc6775en.pdf
govinfo.gov/content/pkg/USCODE-2011-title28/ Felbermayr, G., Kirilakha, A., Syropoulos, C., Yalcen,
html/USCODE-2011-title28-partIV-chap97.htm E., & Yotov, Y. (2020). The Global Sanctions Data
Executive Intelligence Review. (n.d). U.S. Policy Is ‘Suf- Base, August 4, 2020 [Data set]. https://voxeu.
focating the Afghan People’. Executive Intelligence org/article/global-sanctions-data-base#:~:text=-
Review. https://larouchepub.com/other/inter- To%20facilitate%20progress%2C%20we%20devel-
views/2021/4851-dr_shah_mehrabi.html oped%20a%20novel%20data,change%20their%20
Executive Order 13808, 3. C.F.R. 166, (2017). https:// behaviour%20or%20to%20constrain%20their%20
ofac.treasury.gov/media/5476/download?inline actions
Executive Order No 14064. 3 C.F.R. 8391-8393, Fieser, E. Itriago, A., & Zerpa, F. (2022, November 4).
(2022). https://www.federalregister.gov/docu- US Urges Venezuelans to Negotiate to Avoid Losing
ments/2022/02/15/2022-03346/protecting-cer- CITGO Parent Company. Bloomberg. https://www.
tain-property-of-da-afghanistan-bank-for-the-bene- bloomberg.com/news/articles/2022-11-04/us-urg-
fit-of-the-people-of-afghanistan es-venezuelans-to-negotiate-to-avoid-losing-CIT-
Executive Order No 13129. 3 C.F.R. 64-129, (1999) GO-parent?leadSource=uverify%20wall
https://irp.fas.org/offdocs/eo/eo-13129.htm Figueroa, A. (2019a, November 12). Forced internal
Executive Order 13857. 3 C.F.R. 20 (2019). https:// migration grows in Venezuela. OpenDemocracy.
www.state.gov/venezuela-related-sanctions/ https://opendemocracy.net/en/democraciaabier-
Executive Order 13303. 3 C.F.R 646 (2003). https:// ta/la-forzosa-migración-interna-crece-en-venezue-
ofac.treasury.gov/media/24106/download?inline la-en/
Executive Order 13808. 3 C.F.R. 166 (2017). https:// Figueroa, A. (2019b, December 20). CAF se juega otra
ofac.treasury.gov/media/5476/download?inline vez su prestigio con el polémico crédito para el sector
Executive Order 13224. 3 C.F.R. 186 (2001). https:// eléctrico. Tal Cual. https://talcualdigital.com/la-
www.state.gov/executive-order-13224/ caf-se-juega-otra-vez-su-prestigio-con-el-polemico-
Fabre, C. (2018). Economic Statecraft. Cambridge: Har- credito-para-el-sector-electrico/
vard University Press. Figueroa, A. (2023, February 23). Pdvsa ad hoc estima
FAO. (2022a). FAOSTAT [Dataset]. Food and Agricul- ganancias por $2.500 millones en la refinería CIT-
ture Organization of the United Nations. https:// GO en 2022. Tal Cual. https://talcualdigital.com/
www.fao.org/faostat/en/#data/FBS/metadata pdvsa-ad-hoc-estima-ganancias-por-2-500-mil-
FAO. (2022b). The Food Insecurity Experience Scale. lones-en-la-refineria-CITGO-en-2022/
Food and Agriculture Organization of the United Fiona Havlish, individually and on behalf of the ES-
223
TATE OF DONALD G. HAVLISH, JR., De- oilprice.com/Latest-Energy-News/World-News/
ceased, et al., v THE TALIBAN, et al., (Case No. PDVSA-Tankers-To-Be-Detained-For-Lack-Of-
03-md-1570), (S.N.Y 2001) Payment.html
Fitch Ratings. (2022a, January 17). Fitch Revises CAF’s Garip, P. (2020, April 15). Metor reverting to direct
Outlook to Positive; Affirms at ‘A+’. Fitch Ratings. methanol loading in Venezuela. Argus Media. https://
Fitch Ratings. (2022b, March 4). Fitch Affirms CIT- www.argusmedia.com/en/news/2096639-metor-re-
GO’s IDR at ‘B’; Outlook Stable. Fitch Ratings. verting-to-direct-methanol-loading-in-venezuela
https://www.fitchratings.com/research/corpo- Garip, P. (2020, March 23). Curacao seizes PdV oil ter-
rate-finance/fitch-affirms-CITGO-idr-at-b-out- minal in Bonaire. Argus Media. https://www.argus-
look-stable-04-03-2022 media.com/pt/news/2089584-curacao-seizes-pdv-
France 24. (2022, February 4). Honduras restablece rel- oil-terminal-in-bonaire?amp=1
aciones con Venezuela y las mantiene con Taiwán. Garip, P. (2021, January 20). US may restore Venezu-
France 24. https://www.france24.com/es/minu- ela diesel swaps, ease waiver. Argus Media. https://
to-a-minuto/20220204-honduras-restablece-rel- www.argusmedia.com/en/news/2179007-us-may-
aciones-con-venezuela-y-las-mantiene-con-tai- restore-venezuela-diesel-swaps-ease-waiver
w%C3%A1n Garip, P. (2023, January 12). ConocoPhillips in Talks
France 24. (2023, May 05). Maduro acusa al gobierno to Sell Venezuelan Oil in U.S. to Recover Billions
de Biden de “saquear” la petrolera de Venezuela en It Is Owed. The Wall Street Journal (WSJ). https://
EEUU. France24. https://www.france24.com/es/ www.wsj.com/articles/conocophillips-in-talks-to-
minuto-a-minuto/20230505-maduro-acusa-al-go- sell-venezuelan-oil-in-u-s-to-recover-billions-in-
bierno-de-biden-de-saquear-la-petrolera-de-venezu- debt-11673561640
ela-en-eeuu Gavi, the Vaccine Alliance. (2021). COVAX Facility -
Fund for the Afghan People. (2023a, June 16). Minutes COVID-19 Vaccines Global Access: Interim Distribu-
of the meeting of the board of trustees held virtually tion Forecast - Cumulative Allocation, Country-Level
on february 16, 2023, between 12:00pm and 4:10pm COVID-19 Vaccine Distribution Forecast. World
(et). Fund for the Afghan People. https://www.af- Health Organization. https://www.gavi.org/sites/
ghanfund.ch/files/afghan-fund-board-of-trustees- default/files/covid/pr/COVAX_CA_COIP_List_
feb-16-meeting-minutes-for-board-approval.pdf COVAX_PR_12-05-21.pdf
Fund for the Afghan People. (2023b, June 16). State- Gelb, A (1988). Oil windfalls: Blessing or curse. Oxford
ment [Press release]. https://www.afghanfund.ch/ University Press.
files/af-press-release-june-23.pdf General License No. 18. 31 C.F.R. 594. (2021). https://
Fund for the Afghan People. (n.d). Website. https:// ofac.treasury.gov/media/917131/download?inline
www.afghanfund.ch/ General License No. 41. 31 C.F.R. 591. (2022) https://
Geiger, J. (2019, May 24). PDVSA Tankers To Be De- home.treasury.gov/policy-issues/financial-sanc-
tained For Lack Of Payment. Oil Price. https:// tions/sanctions-programs-and-country-informa-
224
tion/venezuela-related-sanctions International Monetary Fund. International Mone-
General License No. 8k. 31 C.F.R. 591. (2022) tary Fund.
h t t p s : / / w w w. f e d e r a l r e g i s t e r. g o v / d o c u - Gómez, S. (2018). Increasing cases of HIV/AIDS in the
m ents / 2 0 2 3 / 0 1 / 1 3 / 2 0 2 3 - 0 0 5 1 5 / p u b l i c a - northern region of the Colombia-Venezuela border:
tion-of-venezuela-sanctions-regulations-web-gener- The impact of high scale migration in recent years.
al-licenses-8k-and-41 Travel Med Infect Dis, 25, 16-17. https://pubmed.
General License No. 42. 31 C.F.R. 591. (2023) https:// ncbi.nlm.nih.gov/29857141/
ofac.treasury.gov/media/931696/download?inline González, E. (2020, January 7). El Gobierno argentino
Ghareghozli, O. (2017). An Estimation of the Eco- retira las credenciales a la representante diplomáti-
nomic Cost of Recent Sanctions on Iran Using the ca de Guaidó en Buenos Aires. El País. https://
Synthetic Control Method. Economics Letters, 157, elpais.com/internacional/2020/01/07/argenti-
141–144. na/1578433322_971218.html
Ghomi, M. (2021). Who is afraid of sanctions? The Goodman, J. (2019, November 14). Oil tankers ‘go dark’
macroeconomic and distributional effects of the off Venezuela to evade US sanctions. AP News. https://
sanctions against Iran. Economics and Politics, 34(3), apnews.com/article/84cabe36652c4194ae2db852e-
395 – 428. 8bab2c4
Gilroy, T., Test, L. S., & Tovar, A. (2022, December 2). Gordon, J. (2006). The accusations against the oil for
OFAC Issues Venezuela General License Authoriz- food program: the volcker reports. Arab Studies
ing Chevron to Resume Limited Extraction Opera- Quarterly, 28(34), 19 – 26.
tions, Related FAQs, and Extends General License Gordon, J. (2020). The Enduring Lessons of the Iraq
Related to PdVSA Wind-Down Transactions. Baker Sanctions. Middle East Report. https://merip.
McKenzie. https://sanctionsnews.bakermckenzie. org/2020/06/the-enduring-lessons-of-the-iraq-
com/ofac-issues-venezuela-general-license-autho- sanctions/
rizing-chevron-to-resume-limited-extraction-oper- Government of UK (February 4, 2019). Joint declara-
ations-related-faqs-and-extends-general-license-re- tion on Venezuela. Government of United Kingdom
lated-to-pdvsa-wind-down-transactions/ [Press Release]. https://www.gov.uk/government/
Gleave, J. (2022, July 28). Repsol confirms Venezue- news/joint-declaration-on-venezuela
la crude deal restart. Argus Media. https://www. Granados, L. (2021, August 12). Cobertura de los Clap
argusmedia.com/en/news/2355519-repsol-con- bajó a solo 1,7 millones de familias de a julio. El Pi-
firms-venezuela-crude-deal-restart tazo. https://elpitazo.net/gran-caracas/cobertura-
Gold Reserve Inc. (n.d.). Brisas Arbitral Award Arbitral de-los-clap-bajo-a-solo-17-millones-de-familias-de-
Award, Settlement Agreement and Mining Data Sale. enero-a-julio/
https://www.goldreserveinc.com/international-ar- Granados, J. (2023, January 18). Venezuelan Talks at
bitration-new/ Risk of Collapse After Gov’t Accuses Opposition of
Gold, J. (1974). Membership and Nonmembership in the Breaking Pledge. Venezuelanalysis. https://venezue-
225
lanalysis.com/news/15686 bach, A. (2023). Economic Sanctions and Human
Grattan, S. (2019, December 3). Protests in Co- Rights: Quantifying Proportionality. University of
lombia spark backlash against Venezuelan mi- Hamburg, 12.
grants. Reuters. https://www.reuters.com/article/ Ha, L., & Nam, P. (2022). An Investigation of Relation-
us-colombia-strike-venezuela/protests-in-colom- ship Between Global Economic Sanction and Life
bia -spark-backla sh- a g a inst-vene zuelan-mi- Expectancy: Do Financial and Institutional System
grants-idUSKBN1Y516U Matter?. Development Studies Research, 9(1), 48–66.
Greenfield, C., & Landay, J. (2022, July 26). Exclusive: Hancock. (2008). The Northern Irish Peace Process:
US and Taliban make progress on Afghan reserves, From Top to Bottom. International Studies Re-
but big gaps remain. Reuters. https://www.reuters. view, 10(2), 203 – 238. http://www.jstor.org/sta-
com/world/exclusive-us-taliban-make-progress- ble/25481958
afghan-reserves-big-gaps-remain-2022-07-26/ Hardie, D. (2020, December 21). Is the integrity of
Grupo de Boston. (2019, November 7). Proyecto de me- Afghanistan’s central bank under threat?. Central
canismo de apoyo Humanitario para la emergencia banking. https://www.centralbanking.com/cen-
del sector eléctrico en Venezuela: Propuesta al Presi- tral-banks/governance/7720661/is-the-integri-
dente y Miembros de la Asamblea Nacional. Grupo de ty-of-afghanistans-central-bank-under-threat
Boston. https://grupodeboston.com/wp-content/ Hausmann, R., & Rigobón, R. (2003). An Alternative
uploads/2022/06/07112019-B1-Servicios-de-Pro- Interpretation of the ‘Resource Curse’: Theory and
duccio%CC%81n-CARTA-GB-CAF-PNUD-AN. Policy Implications. In J.M Davis (Ed.), Fiscal Policy
pdf Formulation and Implementation in Oil-Producing
Grupo de Boston. (2021, June 28). Proyecto de me- Countries.
canismo venezolano de venta de petróleo para la Hausmann, R., & Morales-Arilla, J. (2021). What
ejecución de proyectos humanitarios a través de la should Biden do about Venezuela?. Project Syndi-
ONU: propuesta y consideración. Grupo de Bos- cate. https://www.project-syndicate.org/commen-
ton. https://grupodeboston.com/wp-content/ tary/biden-strategy-on-venezuela-by-ricardo-haus-
uploads/2022/06/28062021-B13-Mecanismo-de- mann-and-jose-morales-arilla-2021-03
Venta-de-Petro%CC%81leo-1.pdf Hausmann, R., & Muci, F. (2019). Don’t Blame Wash-
Gutmann, J. Neuenkirch, M., & Neumeier, F. (2021a). ington for Venezuela’s Oil Woes: A Rebuttal. Amer-
The Economic Effects of International Sanctions: icas Quarterly. https://www.americasquarterly.
An Event Study. Journal of Cooperative Economics, 3. org/article/dont-blame-washington-for-venezue-
Gutmann, J., Neuenkirch, M., & Neumeier, F. (2021b) las-oil-woes-a-rebuttal/
Sanctioned to Death? The Impact of Economic Hausmann, R., Rodríguez, F., & Wagner, R. (2006).
Sanctions on Life Expectancy and its Gender Gap. Growth Collapses. Center for International Devel-
The Journal of Development Studies, 57(1), 139-162. opment at Harvard University. CID Working Paper,
Gutmann, J., Neuenkirch, M., Neumeier, F., & Stein- 136.
226
Hejazi, J., & Emamgholipour, S. (2022). The effects of Hierländer, R., Huber, P., Iara, A., Landesmann, M.,
the Re-imposition of US Sanctions on Food Security Nowotny, K., O’Mahony, M., Peng, F., Robinson,
in Iran. International Journal of Health Policy Man- C., & Stehrer, R. (2010). Migration, Skills and
agement, 11(5), 651 – 657. Productivity. Vienna Institute for International Eco-
Hernández, A. (2022). Omar Barboza: “Primarias son nomic Studies, 365. https://www.econstor.eu/han-
para lograr el cambio político y no para quienes dle/10419/204137
quieren seguir siendo cómplices del régimen”. La Hoffman, A., & Batalova, J. (2023, February 15). Ven-
Gran Aldea. https://lagranaldea.com/2022/06/14/ ezuelan Immigrants in the United States. Migration
omar-barboza-primarias-son-para-lograr-el-cam- Policy Institute. https://www.migrationpolicy.org/
bio-politico-y-no-para-quienes-quieren-seguir-sien- article/venezuelan-immigrants-united-states
do-complices-del-regimen/ Hornby, J. (2016, June 19). China seeks to renego-
Hernández, I., & Monaldi, F. (2016). Weathering Col- tiate Venezuela loans. Financial Times. https://
lapse: An Assessment of the Financial and Opera- www.ft.com/content/18169fbe-33da-11e6-bda0-
tional Situation of the Venezuelan Oil Industry. CID 04585c31b153
Working Paper, 327. Hsieh, C, Miguel, E. Ortega, D., & Rodriguez, F.
Hernández, J. I. (2022a). La defensa judicial del Esta- (2011). The Price of Political Opposition: Evidence
do venezolano en el extranjero y la deuda legada de from Venezuela’s Maisanta. American Economic Jour-
Chávez y Maduro (2019-2020) (1st Ed.). Editorial nal: Applied Economics, 3(2), 196-214.
Jurídica Venezolana. Hufbauer, G. C., Schott, J. J., & Elliott, K. A. (1985).
Hernández, J. I. (2022b). Estudios sobre la reforma del Economic Sanctions Reconsidered: History and Cur-
estatuto de transición de 2022 y la continuidad con- rent Policy. Peterson Institute for International Eco-
stitucional en Venezuela (1st Ed). Editorial Jurídica nomics.
Venezolana Internacional. Hufbauer, G. C., Schott, J. J., & Elliott, K. A. (1990).
Hernández, O. (2023, January 17). Gobierno de Mad- Economic Sanctions Reconsidered: History and Cur-
uro condiciona negociaciones en México con la rent Policy (2nd ed.). Peterson Institute for Interna-
oposición a la “devolución” de US$ 3.200 millones tional Economics.
del acuerdo de protección social. CNN. https:// Hufbauer, G. C., Schott, J. J., Elliott, K. A., & Oegg, B.
cnnespanol.cnn.com/2023/01/17/gobierno-mad- (2007). Economic Sanctions Reconsidered: History
uro-condiciona-negociaciones-mexico-oposici- and Current Policy (3rd ed.). Peterson Institute for
on-devolucion-millones-acuerdo-proteccion-so- International Economics.
cial-orix/ Human Rights Watch. (2019, October 29). Iran: Sanc-
HFW (2022, March 6). EU follows us ban on oil im- tions Threatening Health. Human Right Watch.
ports and expands list of designated persons. HFW. https://www.hrw.org/news/2019/10/29/iran-sanc-
https://www.hfw.com/Syria-Sanctions-EU-Fol- tions-threatening-health
lows-US-Ban Human Rights Watch. (2022, July 5). México/América
227
Central: Nuevos visados hacen sufrir a venezolanos. fobae.com/venezuela/2023/03/07/voluntad-popu-
Human Rights Watch. https://www.hrw.org/es/ lar-anuncio-que-juan-guaido-sera-su-candidato-pa-
news/2022/07/05/mexico/america-central-nue- ra-las-primarias-opositoras-en-venezuela/
vos-visados-hacen-sufrir-venezolanos Infobae. (2023c, May 5). El partido Voluntad Popular
Humphreys, M., Sachs, J., & Stiglitz, J. E. (2007). Escap- anunció que Freddy Superlano será su candidato en
ing the Resource Curse (Initiative for Policy Dialogue las primarias de la oposición en Venezuela. Infobae.
at Columbia: Challenges in Development and Global- https://www.infobae.com/venezuela/2023/05/05/
ization). Columbia University Press. el-partido-voluntad-popular-anuncio-que-fred-
Ibañez, A., Moya, A., Ortega, M., Rodríguez, M., Rozo, dy-superlano-sera-su-candidato-en-las-prima-
S., & Urbina, M. (2022). Cómo un programa de regu- rias-de-la-oposicion-en-venezuela/
larización mejoró la vida de los migrantes venezolanos InfoPa´Lante. (2022, October 3). Conoce cuáles son
en Colombia. IDB. https://publications.iadb.org/ los países que exigen visa a los venezolanos. In-
publications/spanish/viewer/Salir-de-la-sombra-co- foPa´Lante. https://www.infopalante.org/hc/es-co/
mo-un-programa-de-regularizacion-mejoro-la-vida- articles/4466249482775-Conoce-cu%C3%A1les-
de-los-migrantes-venezolanos-en-Colombia.pdf son-los-pa%C3%ADses-que-exigen-visa-a-los-
INE SPAIN. (2022). Cifras de Población (CP) a 1 de ju- venezolanos-
lio de 2022 Estadística de Migraciones (EM). Primer Inter-American Development Bank. (2021a). Annual
semestre de 2022 [Press release]. https://www.ine.es/ Report 2021 Financial Statements. Interamerican
prensa/cp_j2022_p.pdf Development Bank. https://publications.iadb.org/
Infobae. (2020, January 6). Juan Guaidó renunció a su en/inter-american-development-bank-annual-re-
partido Voluntad Popular para dedicarse a la presi- port-2021-financial-statements
dencia interina de Venezuela. Infobae. https://www. Inter-American Development Bank. (2021b). In-
infobae.com/america/venezuela/2020/01/06/ ter-American Development Bank Annual Report
juan-guaido-renuncio-a-su-partido-voluntad-popu- 2021: Year in Review. Interamerican Development
lar-para-dedicarse-a-la-presidencia-interina-de-ven- Bank. https://publications.iadb.org/en/inter-ameri-
ezuela/ can-development-bank-annual-report-2021-year-re-
Infobae. (2023a, February 16). Maduro volvió a patear view
la mesa de diálogo y puso en duda el regreso a las Inter-American Development Bank. (n.d.a). Overview.
negociaciones con la oposición. Infobae. https:// Interamerican Development Bank. https://www.iadb.
www.infobae.com/venezuela/2023/02/16/maduro- org/en/about-us/overview
volvio-a-patear-la-mesa-de-dialogo-y-puso-en-duda- Inter-American Development Bank. (n.d.b). Public
el-regreso-a-las-negociaciones-con-la-oposicion/ Sector Financing. Interamerican Development Bank.
Infobae. (2023b, March 7). Voluntad Popular anunció https://www.iadb.org/en/about-us/public-sector-fi-
que Juan Guaidó será su candidato para las primarias nancing
opositoras en Venezuela. Infobae. https://www.in- Inter-American Development Bank. (n.d.c). Investment
228
Lending Category. Interamerican Bank. https:// 1key=2001-05-31
www.iadb.org/en/about-us/public-sector-financ- International Monetary Fund – IMF. (n.d.d). SDR Val-
ing/investment-lending-category uation. IMF https://www.imf.org/external/np/fin/
Inter-American Development Bank. (n.d.d). Poli- data/rms_sdrv.aspx
cy-Based Lending Category. Interamerican Devel- International Monetary Fund – IMF. (n.d.e). Total IMF
opment Bank. https://www.iadb.org/en/about-us/ Credit Outstanding. IMF. https://www.imf.org/ex-
public-sector-financing/policy-based-lending-cate- ternal/np/fin/tad/balmov2.aspx?type=TOTAL
gory International Monetary Fund – IMF. (n.d.f ). Ques-
Inter-American Development Bank. (n.d.e). Special tions and answers on special drawing rights (SDRs).
Development Lending. Interamerican Development IMF. https://www.imf.org/en/About/FAQ/spe-
Bank. https://www.iadb.org/en/about-us/pub- cial-drawing-right
lic-sector-financing/special-development-lending International Monetary Fund – IMF. (n.d.g). SDR In-
Inter-American Development Bank. (n.d.f ). Poli- terest Rate Calculation. IMF. https://www.imf.org/
cy-Based Lending Category. Interamerican Devel- external/np/fin/data/sdr_ir.aspx
opment Bank. https://www.iadb.org/en/about-us/ International Monetary Fund – IMF. (2003). External
public-sector-financing/policy-based-lending-cate- debt statics. IMF. https://www.imf.org/external/
gory pubs/ft/eds/eng/guide/file2.pdf
Inter-American Development Bank. (n.d.g). Conces- International Monetary Fund – IMF. (2005). Current
sional Resources. Interamerican Development Bank. Developments in monetary and Financial Law. Vol 3.
https://www.iadb.org/en/about-us/concessional-re- International Monetary Fund.
sources International Monetary Fund – IMF. (2011). IMF Sur-
International Development Association – IDA. (2023, vey: IMF Revamps Lending Options in Response to
March 8). How Are IDA Resources Allocated?. World Global Crisis, December. https://www.imf.org/en/
Bank Group. https://ida.worldbank.org/en/financ- News/Articles/2015/09/28/04/53/sopol120711a
ing/resource-management International Monetary Fund – IMF. (2018). Chal-
International Monetary Fund – IMF. (n.d). IMF Lend- lenges to Steady Growth. World Economic Outlook.
ing. IMF https://www.imf.org/en/About/Fact- IMF. https://www.imf.org/en/Publications/WEO/
sheets/IMF-Lending Issues/2018/09/24/world-economic-outlook-octo-
International Monetary Fund. (n.d.b). The Rapid Fi- ber-2018
nancing Instrument (RFI). IMFhttps://www.imf. International Monetary Fund – IMF. (2019). “The
org/en/About/Factsheets/Sheets/2023/Rapid-Fi- fund’s financing role-reform proposals on liquidity
nancing-Instrument-RFI and emergency assistance- rapid financing instrument
International Monetary Fund. (n.d.c). Quota of Vene- (RFI),” Selected decisions and selected documents of the
zuela. IMF https://www.imf.org/external/np/fin/ IMF. Fortieth Issue. IMF
tad/exquota.aspx?memberKey1=1050anddate- International Monetary Fund – IMF. (2020a). Colom-
229
bia: Declaración al término de la misión sobre la Con- tics-in-fresh-bid-to-unseat-maduro#xj4y7vzkg
sulta del Artículo IV. IMF. https://www.imf.org/es/ Itriago, A., & Marlow, I. (2023, March 31). Maduro Foes
News/Articles/2020/02/21/mcs-022120-colom- Can’t Get Money for Lawyers After Guaidó’s Oust-
bia-staff-concluding-statement-of-the-2020-article- er. Bloomberg. https://www.bloomberg.com/news/
iv-mission articles/2023-03-31/venezuela-opposition-can-t-ac-
International Monetary Fund – IMF. (2020b). Articles cess-millions-frozen-by-us-sanctions-to-pay-lawyers
of Agreement of the International Monetary Fund. Itriago, A., & Flatley, D. (2023, May 4). Venezuela Op-
IMF position Regains Access to $347 Million Frozen
International Monetary Fund – IMF. (August 23, 2021). by US. Bloomberg. https://www.bloomberg.com/
2021 General SDR Allocation SPECIAL DRAW- news/articles/2023-05-04/venezuela-opposition-re-
ING RIGHTS. International Monetary Fund. gains-access-to-us-accounts-frozen-by-sanctions
https://www.imf.org/en/Topics/special-draw- Itriago, A., Martin, E., & Yapur, N. (2023, May 18).
ing-right/2021-SDR-Allocation US Green Light’s UN’s Venezuela Fund in Boost to
International Monetary Fund – IMF. (2023a). 2021 Negotiations. Bloomberg. https://www.bloomberg.
General SDR Allocation. IMF. https://www.imf.org/ com/news/articles/2023-05-18/us-green-lights-un-
en/Topics/special-drawing-right/2021-SDR-Allo- s-venezuela-fund-in-boost-to-negotiations
cation Jiménez, C. (2022, November 8). Current migration
International Monetary Fund – IMF. (2023b, June 30). dynamics call for new regional approaches. WOLA.
IMF Executive Board Approves an Extension of the https://www.wola.org/analysis/current-migra-
Temporarily Higher Cumulative Access Limits under tion-dynamics-call-new-regional-approaches/
the Fund’s Emergency Financing Instruments and an Jiménez v. Palacios, 250 A.3d 814. (2019). https://case-
Extension of the Food Shock Window. IMF. https:// text.com/case/jimenez-v-palacios-4
www.imf.org/en/News/Articles/2023/06/30/ Joya, O. [@joyacabolitae]. (2022, September 15). Newly
pr23252-food-shock-imf-exec-board-approves-ext- established Afghan Fund managing $3.5bn of FX re-
temp-higher-cum-access-limits-emerg-fin-inst-ext serves will simply alleviate fiscal pressures for TLB and
International Monetary Fund staff. (2020a). Protecting provide them with windfall income. I’m suggesting
IMF Resources - Safeguards Assessments of Central some essential accountability and transparency stan-
Banks. International Monetary Fund. March.ISDA. dards to avoid disaster, 4 details see following note @
(2017). Determinations Committee Decision. US4AfghanPeace [Tweet]. Twitter. https://twitter.
https://www.cdsdeterminationscommittees.org/ com/joyacabolitae/status/1570400358454931458
documents/2017/11/pdvsa-vote-nov-16.pdf/ Kancs, D., & Lecca, P. (2019). Long-term social, eco-
Itriago, A., & Laya, P. (2022, October 11). Venezuela nomic and fiscal effects of immigration into the EU:
Opposition Plans to Take on Maduro in 2024 Vote. The role of the integration policy. The World Econo-
Bloomberg. https://www.bloomberg.com/news/ my, 41(10), 2599-2630. https://onlinelibrary.wiley.
articles/2022-10-11/venezuela-parties-switch-tac- com/doi/full/10.1111/twec.12637

Kangasniemi, M., Mas, M., Robinson, C., & Serra- sacar carnet de la patria. La Patilla. https://www.
no, L. (2012). The economic impact of migration: lapatilla.com/2018/07/30/francisco-cardiel-es-in-
productivity analysis for Spain and the UK. J Prod constitucional-y-dictatorial-obligar-a-los-venezola-
Anal, 38, 333–343. https://link.springer.com/arti- nos-para-sacar-carnet-de-la-patria/
cle/10.1007/s11123-012-0280-4 Laya, P., & Vasquez, A. (2020, March 17). IMF Won’t
Kassai, L. (n.d). VENEZUELA TRACKER: Oil Flows Lend to Venezuela Because Maduro Lacks Recog-
Fall Despite Easing of US Sanctions. Bloomberg. nition. Bloomberg. https://www.bloomberg.com/
Katzman, K., & Blanchard C. (2005). Iraq: Oil-For- news/articles/2020-03-17/venezuela-requests-5-bil-
Food Program, Illicit Trade, and Investigations. CRS lion-from-imf-to-fight-coronavirus
Report for Congress. Congressional Research Service. Lebow, J. (2022). The Labor Market Effects of Venezue-
Kavakli, K., Chatagnier, J. & Hatipoglu, E. (2019). The lan Migration to Colombia: Reconciling Conflicting
Power to Hurt and the Effectiveness of International Results. IZA Journal of Development and Migration,
Sanctions. The Journal of Politics, 82(3) https://doi. 13(1). https://papers.ssrn.com/sol3/papers.cfm?ab-
org/10.1086/707398 stract_id=3778377
Kholodilin, A., & Netšunajev, A. (2018). Crimea and Legal Sidebar. (2016, August 11). When Does Sovereign
punishment: the impact of sanctions on Russian Immunity Protect Property Owned by State Sponsors
economy and economies of the euro area. Baltic of Terrorism?. CRS Reports and Analysis. https://
‘Journal of Economics, 19(1), 39 – 51. https://doi.org sgp.fas.org/crs/misc/immunity.pdf
/10.1080/1406099X.2018.1547566 Leon, I. (2023, February 3). Obstáculos políticos y
Kim, Y. (2019). Economic Sanctions and HIV/AIDS jurídicos bloquean el acuerdo social: esto es lo que se
in Women. Journal of Public Health Policy, 40(3), sabe. Efecto Cocuyo.https://efectococuyo.com/polit-
351–366. https://www.jstor.org/stable/48703568 ica/obstaculos-politicos-y-juridicos-bloquean-el-ac-
La Nación. (2020, November 10). Afuera Guaidó, ad- uerdo-social-esto-es-lo-que-se-sabe/
entro Bolívar. Tras la asunción de Arce en Levin, R., & Pettersson, R. (2019). The transfer of Ven-
Bolivia, el chavismo volvió a la embajada de Venezuela. ezuela´s oil assets to a successor entity and fraudulent
La Nación. https://www.lanacion.com.ar/el-mun- conveyance. Capital Markets Law Journal, 14(4),
do/venezuela-embajada-bolivia-cuadro-juan-guai- 531 – 550. https://doi.org/10.1093/cmlj/kmz020
do-jorge-nid2505449/ Ley del Estatuto que rige la Transición a la Democracia.
La Nación. (2023, April 25). Juan Guaidó llegó a Esta- December 16, 2020. (Venezuela).
dos Unidos tras ser obligado a abandonar Colombia. Ley Orgánica de Hidrocarburos de 2006. Gaceta Oficial
La Nación. https://www.lanacion.com.ar/el-mun- 38443: 2006. May 24, 2006, (Venezuela).
do/juan-guaido-llego-a-estados-unidos-tras-aban- Ley Orgánica de Planificación Pública y Popular de
donar-colombia-nid25042023/ Venezuela. December 10, 2010. (Venezuela)
La Patilla. (2018, July 30). Francisco Cardiel: Es incon- Libertad Diario. (2021, August 20). Supersociedades
stitucional y dictatorial obligar a los venezolanos para Somete A Control A Monómeros Colombo Venezola-

nos. Libertad Diario. https://es.scribd.com/docu- Lucena, C., & Apolinário L. (2016). Targeted Versus
ment/523568929/Supersociedades-somete-a-con- Conventional Economic Sanctions: What Is at Stake
trol-a-Monomeros-Colombo-Venezolanos# for Human Rights?. Empirical and Theoretical Re-
Llamas, T., Chase, B. Torres, I., Radia, K., Castano, A., search in International Relations, 42(4), 565–589.
Hoyos, J., & Jacobo, J. (2019, February 26). Venezu- https://doi.org/10.1080/03050629.2015.1036989
ela President Nicolas Maduro accuses US government Lugo, O. (2022, October 4). Cómo la libertad de
of fabricating a crisis to start war in South America. narcosobrinos desnuda agonía de la oposición en
ABC News. https://abcnews.go.com/Internation- Venezuela. El Estímulo. https://elestimulo.com/
al/maduro-accuses-us-government-fabricating-cri- venezuela/2022-10-04/como-la-libertad-de-nar-
sis-start-war/story?id=61215212 cosobrinos-desnuda-agonia-de-la-oposicion-en-ven-
Los #Sinluz. (2018, February 19). EL SERVICIO ezuela/
ELÉCTRICO ZULIANO AL BORDE DEL CO- Lusa. (2019, April 17). Maduro exige ao Novo Algo del
LAPSO. Los #Sinluz en la prensa. https://www. tipo “os 1,5 mil milhões que nos roubaram”. Diário
lossinluzenlaprensa.com/servicio-electrico-zulia- de Noticias. https://www.dn.pt/mundo/venezue-
no-al-borde-del-colapso/ la-maduro-pede-a-portugal-para-desbloquear-fun-
Los #Sinluz. (2019, April 1). “Ha sido casi un milagro dos-retidos-no-novo-banco-10805427.html
tener luz en Guayana cuando todo el país ha estado Maduradas. (2023, February 27). José Brito se quejó
a oscuras.” Los #Sinluz en la prensa. https://www. de que Primero Venezuela no fue convocado a las
lossinluzenlaprensa.com/ha-sido-casi-un-milagro- primarias de la oposición: “Nos excluyeron”. Mad-
tener-luz-en-guayana-cuando-todo-el-pais-ha-esta- uradas. https://maduradas.com/jose-brito-se-que-
do-a-oscuras/ jo-primero-venezuela-no-fue-convocado-las-prima-
Los #Sinluz. (2022, October 20). Grupo Orinoco: recu- rias-la-oposicion-nos-excluyeron/
peración del sistema eléctrico supera los 15.000 mil- Maia, M., & Paraguassu, L. (2018, August 23). Brazil
lones de dólares. Los #Sinluz en la prensa. https:// sends troops as Venezuelans flee crisis at home. Re-
www.lossinluzenlaprensa.com/grupo-orinoco-recu- uters. https://www.reuters.com/article/uk-venezue-
peracion-del-sistema-electrico-supera-los-15-000- la-migration-brazil-idUKKCN1L51JG
millones-de-dolares/ Majaski, C. (2022, November 22). Statute of Limita-
Lozano, D. (2021a, October 16). El nuevo Gobierno tions: Definition, Types, and Example. Investope-
peruano rompe con Guaidó y abraza a Maduro. El dia. https://www.investopedia.com/terms/s/stat-
Mundo. https://www.elmundo.es/internaciona- ute-of-limitations.asp
l/2021/10/16/616a9db1e4d4d826778b45bc.html Maldonado, L., & Olivo, V. (2022) Venezuela Still an
Lozano, D. (2021b, April 15). Un carnet de la patria Upper-Middle-Income Country? Estimating GNI
para acceder a la vacuna en Venezuela. El Mundo. per capita for 2015-2021. IADB. http://dx.doi.
https://www.elmundo.es/internacional/2021/04/1 org/10.18235/0004612
5/60787662fdddfff5b68b4594.html Mármol, B. [@bmarmoldeleon]. (2018, August 30).
232
“ El “Carnet de la Patria” es inconstitucional. Es dis- la República. https://repositorio.banrep.gov.co/
criminación prohibida en el artículo 21 de la CN que bitstream/handle/20.500.12134/9846/DTSE-
dice que no se permitirán discriminaciones que tengan RU_289.pdf
por objeto menoscabar goce o ejercicio en condiciones Mendoza, N. (2015, October 5). CAF vs IADB: How
de igualdad de los derechos de toda persona” [Tweet]. They Compare. Devex. https://www.devex.com/
Twitter. https://twitter.com/bmarmoldeleon/sta- news/caf-vs-IADB-how-they-compare-86997
tus/1035206269538377728 Meneses, J., & Saboin, J. (2021). Growth Recoveries
Marois, G., Bélanger, A., & Lutz, W. (2020). Population from Collapses. IADB Discussion Paper Nº IADB-
aging, migration, and productivity in Europe. DP-880. http://dx.doi.org/10.18235/00034
Proc Natl Acad Sci U S A, 117(14), 7690-7695. Miers, A., & Morgan, C. (2002). Multilateral Sanc-
10.1073/pnas.1918988117 tions and Foreign Policy Success: Can Too
Martin, L. (1992). Coercive Cooperation: Explaining Many Cooks Spoil the Broth?. Internation-
Multilateral Economic Sanctions. Princeton Univer- al Interactions 28(2), 117– 136. https://doi.
sity Press. org/10.1080/03050620212099
Martínez, D. (2022a, August 11,). Procurador especial Ministerio del Poder Popular de Economía, Finanzas
alerta que se necesitan fondos para pagar por la de- y Comercio Exterior. (2020, December 13). Toll-
fensa de activos. Efecto Cocuyo. https://efectococuyo. ing Agreement. MPPEFF. http://www.oncp.gob.
com/politica/procurador-delegada-legislativa-recur- ve/jdownloads/noticias/Venezuela_-_TOLLING_
sos-defensa-activos/ AGREEMENT_11.11.2020_Ingles.pdf
Martínez, D. (2022b, November 9). Estos son los 10 Ministerio del Poder Popular de Economía, Finanzas
miembros de la Comisión Nacional de Primaria de la y Comercio Exterior. (2023, March 30). Tolling an-
oposición. Efecto Cocuyo. https://efectococuyo.com/ nouncement. MPPEFF. http://www.oncp.gob.ve/
politica/plataforma-unitaria-democratica-comis- jdownloads/noticias/MPPEF-_Tolling_Announce-
ion-nacional-primaria/ ment_Draft_30.03.2023_ENGv3.pdf
Martínez, D. (2004). El proceso migratorio entre Co- Ministerio del Poder Popular de Economía, Finanzas y
lombia y Venezuela (1989-2014). [Master’s Thesis, Comercio Exterior. (2022, January 7). Soberanía y
Universidad Católica de Colombia]. https://repos- seguridad alimentaria: distribuidas más de 3 mil ton-
itory.ucatolica.edu.co/bitstream/10983/3107/4/ eladas de alimentos durante el 2022. MPPEF. http://
TESINA%20EL%20PROCESO%20MIGRA- www.mppef.gob.ve/soberania-y-seguridad-alimenta-
TO R I O % 2 0 E N T R E % 2 0 C O L O M B I A % 2 0 ria-distribuidas-mas-de-3-mil-toneladas-de-alimen-
Y%20VENEZUELA%201989%202014%20%20 tos-durante-el-2022/
PRINCIPALES%20CAUSAS%20Y%20EFEC- Ministerio del Poder Popular para la Energía Eléctrica.
TOS%20P.pdf (2020, October 30). Néstor Reverol Torres es desig-
Melo, A., Otero, A., Ramos, J., & Tribín, A. (2020). nado nuevo ministro de Energía Eléctrica. Ministerio
Impacto fiscal de la migración venezolana. Banco de del Poder Popular para la Energía Eléctrica [Press re-
233
lease]. Gobierno Bolivariano de Venezuela. http:// gon-masivo-en-2019-afecta-22-estados-de-venezue-
www.corpoelec.gob.ve/noticias/n%C3%A9s- la/
tor-reverol-torres-es-designado -nuevo -min- Morales, J. R. (2019). Sanciones: ¿causa o consecuencia
istro-de-energ%C3%ADa-el%C3%A9ctrica de la crisis?. Prodavinci. https://prodavinci.com/
Miranda, B. (2021, January 5). Asamblea Nacional de sanciones-causa-o-consecuencia-de-la-crisis/
Venezuela: qué cambia ahora que el chavismo con- Morales, M. (2022, November 25). Primero Venezuela
trola también el Parlamento (y qué pasa con Juan solicitó reunión a la Comisión Nacional de Primaria.
Guaidó). BBC News Mundo. https://www.bbc.com/ Crónica 1. https://cronica.uno/primero-venezue-
mundo/noticias-america-latina-55540295 la-solicito-reunion-a-la-comision-nacional-de-pri-
Mnookin, R. H. (2003). Strategic Barriers to Dispute maria/
Resolution: A Comparison of Bilateral and Multilat- Morales, M., & García, A. (2021, December 29).
eral Negotiations. Journal of Institutional and Theo- Monómeros se salvó de la corrupción de Maduro
retical Economics (JITE) / Zeitschrift Für Die Gesam- pero no de los intereses partidistas de la oposición.
te Staatswissenschaft, 159(1), 199–220. http://www. Crónica Uno. https://cronica.uno/monomer-
jstor.org/stable/40752385 os-salvo-corrupcion-maduro-no-intereses-partidis-
Moleiro, A. (2023, February 15). La oposición venezola- tas-oposicion/
na convoca primarias el 22 de octubre para elegir al Morgan, C. Bapat, N., & Kobayashi, Y. (2014a). Threat
candidato que enfrente a Maduro en 2024. El País. and imposition of economic sanctions 1945–2005:
https://elpais.com/internacional/2023-02-15/la- Updating the TIES dataset. Conflict Management
oposicion-venezolana-convoca-primarias-el-22-de- and Peace Science, 31(5), 541–558. https://doi.
octubre-para-elegir-al-candidato-que-enfrente-a- org/10.1177/0738894213520379
maduro-en-2024.html Morgan, C. Bapat, N., & Kobayashi, Y. (2014b). Threat
Monaldi, F., Hernández, I., & La Rosa Reyes, J. (2021). and Imposition of Economic Sanctions (TIES) Data
The collapse of the Venezuelan oil industry: The role [Data set]. Threat and Imposition of Sanctions
of above-ground risks limiting foreign investment. (TIES) Data Page. https://sanctions.web.unc.edu/
Resources Policy, 72. https://doi.org/10.1016/j.re- Mutis, O., Ríos, C, Montaño, L., & Monroy, V. (2021).
sourpol.2021.102116. Crisis u oportunidad: impacto de la migración
Monaldi, F., & Penfold, M. (2012). Institutional Col- venezolana en la productividad colombiana. Desar-
lapse: The Rise and Breakdown of Democratic Gov- rollo y sociedad, 89, 13-56. https://revistas.uniandes.
ernance in Venezuela. In F. Rodriguez & R. Haus- edu.co/doi/full/10.13043/DYS.89.1
mann (Eds.), Venezuela Before Chávez: Anatomy of Neuhaus, J., & Neverova, Y. (2017). Sullivan & Crom-
an Economic Collapse. Penn State University Press. well Discusses Sovereign Debt Litigation. The CLS
Monitor ProDaVinci. (2019, July 22). Cuarto apagón blue sky Blog. https://clsbluesky.law.columbia.
masivo en 2019 afecta 22 estados de Venezuela. edu/2017/01/06/sullivan-cromwell-discusses-sov-
ProDaVinci. https://prodavinci.com/cuarto-apa- ereign-debt-litigation/
234
Nederr, S. (2021, September 28). Procurador Es- mentación: De la gran Red Mercal a las bol-
pecial señaló desatención de la AN y pide re- sas Clap. Radiografía del fracaso [White Paper].
cursos para defender activos. Tal Cual. https:// Transparencia Venezuela. http://saber.ucv.ve/
talcualdigital.com/procurador-especial-senalo-desa- bitstream/10872/19258/1/2018%20Mision%20
tencion-de-la-an-y-pide-recursos-para-defender-ac- Alimentacion%20De%20la%20gran%20red%20
tivos/ MERCAL%20a%20las%20bolsas%20CLAP%20
Nederr, S. (2023a, January 19). AN-2015 nombra Con- Radiograf%c3%ada%20del%20fracaso.pdf
sejo de Administración de Activos y ratifica Junta ad Observatorio Venezolano de Servicios Públicos (2022).
hoc del BCV. Tal Cual. https://talcualdigital.com/ Percepción ciudadana de los servicios públicos: Resulta-
an-2015-nombra-consejo-de-administracion-de-ac- dos de encuestas a usuarios de fecha abril-mayo 2022.
tivos-y-ratifica-junta-ad-hoc-del-bcv/ OVSP. http://www.observatoriovsp.org/wp-con-
Nederr, S. (2023b, February 10). Exprocurador Sánchez tent/uploads/Boletin-35.pdf
Falcón ejecutó $ 883 mil y dice que el oro y CITGO Observatorio Venezolano de Servicios Públicos (2023a,
siguen a salvo. Tal cual. https://talcualdigital.com/ January 29). OVSP: 87% de los encuestados almacena
exprocurador-sanchez-falcon-ejecuto-883-mil-y- agua en sus hogares, mientras que el 58,7% señala que
dice-que-el-oro-y-CITGO-siguen-a-salvo/ el recurso hídrico presenta coloración. OVSP. https://
Nephew, R. (2017). The Art of Sanctions: A View from www.obser vatoriovsp.org/ovsp-87-de-los-en-
the Field. Columbia University Press. cuestados-almacena-agua-en-sus-hogares-mien-
Neuenkirch, M., & Neumeier, F. (2015). The Impact of tras-que-el-587-senala-que-el-recurso-hidrico-pre-
UN and US Economic Sanctions on GDP Growth. senta-coloracion/
European Journal of Political Economy, 40 (part Observatorio Venezolano de Servicios Públicos (2023b,
A), 110–125. https://doi.org/10.1016/j.ejpole- February 12). Conozca la evaluación del servicio eléc-
co.2015.09.001 trico según el más reciente estudio del OVSP. OVSP.
Neuenkirch, M., & Neumeier, F. (2016). The impact https://www.observatoriovsp.org/conozca-la-evalu-
of US sanctions on poverty. Journal of Development acion-del-servicio-electrico-segun-el-mas-reci-
Economics, 121 (part C), 110 – 119. ente-estudio-del-ovsp/
News desk. (2022, October 22). Freezing of Afghan Ocando, G. (2022, August 11). Abogados dan ultimato
assets was political decision: Ahadi. Pakistan OB- a la oposición venezolana por falta de pagos por litigios
SERVER. https://pakobserver.net/freezing-of-af- de activos. VOA News. https://www.vozdeamerica.
ghan-assets-was-political-decision-ahadi/ com/a/tres-firmas-de-abogados-dan-ultimato-a-
Norton Rose Fulbright. (2015, April). Bancec ap- oposici%C3%B2n-venezolana-por-falta-de-pa-
plied. Norton Rose Fulbright. https://www.nor- gos/6698024.html
tonrosefulbright.com/en/knowledge/publica- Office for the Coordination of Humanitarian Affairs -
tions/00e642d1/bancec-applied OCHA. (2019). Financial Tracking service: Venezu-
Observatorio de Misiones. (2018). Misión Ali- ela, Bolivarian Republic 2019. OCHA. https://fts.
235
unocha.org/countries/242/summary/2019 loads/2021/04/OIL-FOR-VENEZUELA-2021-1.
Office for the Coordination of Humanitarian Af- pdf
fairs - OCHA. (2020, September 30). The impact Ojeda, L. (2020, March 17). En lucha contra Covid-19
of bank de-risking on humanitarian action. Relief Venezuela solicita financiamiento al FMI. Ministerio
Web. https://reliefweb.int/training/3674051/im- del Poder Popular para Relaciones Exteriores. Gobi-
pact-bank-de-risking-humanitarian-action erno Bolivariano de Venezuela. https://mppre.gob.
Office for the Coordination of Humanitarian Af- ve/2020/03/17/lucha-covid-19-venezuela-solici-
fairs - OCHA. (2022). Venezuela Humanitar- tud-financiamiento-fmi/
ian Response Plan. OCHA Services. https:// Oliveros, L. (2020). Efecto de las Sanciones Financieras
humanitarianaction.info/plan/1097?bs=eyJibG- y Petroleras sobre Venezuela. Washington Office on
9jay04Yjc1NGFhMS0yNzE4LTRhNzAtYTE4M- Latin America (WOLA).
S02ODkyMzM5ZTY5NzYiOnsidGFyZ2V0Ijow- Olmo, G. D. (2018, August 29). Por qué es tan difícil
f X0%3D conseguir un pasaporte para salir de Venezuela. BBC
Office for the Coordination of Humanitarian Affairs - News Mundo. https://www.bbc.com/mundo/noti-
OCHA. (2023). Venezuela, Bolivarian Republic of - cias-america-latina-45292923
Requirements and Funding Data [Data set]. OCHA Organización Panamericana de la Salud (PAHO).
Services. https://data.humdata.org/dataset/fts-re- (2022, March 18,). Llega a Venezuela nuevo lote con
quirements-and-funding-data-for-venezuela-boli- cerca de 4,7 millones de dosis de vacunas contra la
varian-republic-of COVID-19 a través de COVAX. Organización Pan-
OI European Group et al. v Bolivarian Republic of Ven- americana de la Salud. https://www.paho.org/es/
ezuela, Case 1:19-mc-00290. District Court of noticias/18-3-2022-llega-venezuela-nuevo-lote-con-
Delaware, 2023. Order March 23, 2023. cerca-47-millones-dosis-vacunas-contra-covid-19
Oil For Venezuela (2019). A humanitarian oil Organización Panamericana de la Salud (PAHO).
agreement for Venezuela an emergency pro- (2020, October 23). Venezuela ampliará a todo el país
gram to protect Venezuelans from the collater- el diagnóstico confirmatorio de COVID-19. Organi-
al impact of the country’s political conflict [White zación Panamericana de la Salud. https://www.paho.
paper]. Oil for Venezuela. https://en.oilfor- org/es/noticias/23-10-2020-venezuela-ampliara-to-
venezuela.org/wp-content/uploads/2022/02/Hu- do-pais-diagnostico-confirmatorio-covid-19
manitarian-Oil-Agreement-PDF.pdf Organization of the Petroleum Exporting Countries
Oil for Venezuela. (2020). US sanctions on Venezuela: (OPEC). (2012). OPEC Annual Report: 2012.
alternatives to maximum pressure. Oil for Venezuela. OPEC. https://www.opec.org/opec_web/stat-
Oil for Venezuela. (2021). Tackling Venezuela’s hu- ic_files_project/media/downloads/publications/
manitarian crisis: Mobilizing Resources Through a AR2012.pdf
Political Agreement [White paper]. Oil for Venezu- Organization of the Petroleum Exporting Countries
ela. https://en.oilforvenezuela.org/wp-content/up- (OPEC). (2013). OPEC Annual Report: 2013.
236
OPEC. https://www.opec.org/opec_web/stat- OPEC. https://www.opec.org/opec_web/stat-
ic_files_project/media/downloads/publications/ ic_files_project/media/downloads/publications/
AR_2013.pdf AR%202020.pdf
Organization of the Petroleum Exporting Countries Organization of the Petroleum Exporting Countries
(OPEC). (2014). OPEC Annual Report: 2014. (OPEC). (2021). OPEC Annual Report: 2021.
OPEC. https://www.opec.org/opec_web/static_ OPEC. https://www.opec.org/opec_web/stat-
files_project/media/downloads/publications/An- ic_files_project/media/downloads/publications/
nual_Report_2014.pdf AR%202021.pdf
Organization of the Petroleum Exporting Countries Organization of the Petroleum Exporting Countries
(OPEC). (2015). OPEC Annual Report: 2015. (OPEC). (2023). OPEC Monthly Oil Market Re-
OPEC. https://www.opec.org/opec_web/stat- port: January 2023. OPEC. https://www.opec.org/
ic_files_project/media/downloads/publications/ opec_web/en/publications/7107.htm
AR%202015.pdf Parker, D. Foltz, J., & Elsea, D. (2017). Unintended
Organization of the Petroleum Exporting Countries Consequences of Sanctions for Human Rights: Con-
(OPEC). (2016). OPEC Annual Report: 2016. flict Minerals and Infant Mortality. The Journal of
OPEC. https://www.opec.org/opec_web/stat- Law and Economics, 59(4), 731-774. http://dx.doi.
ic_files_project/media/downloads/publications/ org/10.1086/691793
AR%202016.pdf Parraga, M., & Guanipa, M. (2021a, October 4). Dilu-
Organization of the Petroleum Exporting Countries ent shortage curbs Venezuela’s September oil exports,
(OPEC). (2017). OPEC Annual Report: 2017. data shows. Reuters. https://www.reuters.com/
OPEC. https://www.opec.org/opec_web/stat- business/energy/diluent-shortage-curbs-venezue-
ic_files_project/media/downloads/publications/ las-september-oil-exports-data-shows-2021-10-04/
AR%202017.pdf Parraga, M., & Guanipa, M. (2021b, December 2).
Organization of the Petroleum Exporting Countries Venezuela’s oil exports fell in Nov amid quality,
(OPEC). (2018). OPEC Annual Report: 2018. infrastructure issues -data. Reuters. https://www.
OPEC. https://www.opec.org/opec_web/stat- reuters.com/markets/europe/venezuelas-oil-ex-
ic_files_project/media/downloads/publications/ ports-fell-nov-amid-quality-infrastructure-issues-da-
AR%202018.pdf ta-2021-12-02/
Organization of the Petroleum Exporting Countries Parraga, M., & Buitrago, D. (2021, November 19). EX-
(OPEC). (2019). OPEC Annual Report: 2019. CLUSIVE Venezuelan petrochemicals arrive in U.S.
OPEC. https://www.opec.org/opec_web/stat- despite Washington trade curbs. Reuters. https://
ic_files_project/media/downloads/publications/ www.reuters.com/markets/europe/exclusive-vene-
AR%202019%20for%20web.pdf zuelan-petrochemicals-arrive-us-despite-washing-
Organization of the Petroleum Exporting Countries ton-trade-curbs-2021-11-18/
(OPEC). (2020). OPEC Annual Report: 2020. Parraga, M. (2022a, January 10). Venezuela to ex-
237
port diluted crude after 9-month pause, document sia-mexico-data-sources-2023-04-26.
shows. Reuters. https://www.reuters.com/markets/ Párraga, M. (2023c, June 30). Venezuela pursues debt
commodities/venezuela-export-diluted-crude-af- settlement with Crystallex, Conoco, bondholders.
ter-9-month-pause-document-shows-2022-01-10/ Reuters. https://www.reuters.com/article/CIT-
Parraga, M., & Spetalnick, M. (2022b, June 6). U.S. to GO-court-negotiations-idAFL1N38K2FD
let Eni, Repsol ship Venezuela oil to Europe for debt. Párraga, M. and Hals, T. (2023, September 12). Citgo
Reuters. https://www.reuters.com/business/energy/ valued at $32 billion-$40 billion ahead of auction of
exclusive-us-let-eni-repsol-ship-venezuela-oil-eu- shares -court hearing. Reuters. https://www.reuters.
rope-debt-sources-2022-06-05/ com/business/energy/citgo-petroleum-valued-32-
Parraga, M. (2022c, June 8). EXCLUSIVE Vene- bln-40-bln-ahead-auction-shares-parent-compa-
zuela demands prepayment on spot oil sales after ny-2023-09-12/
buyer defaults -sources. Reuters. https://www.reu- Peksen, D., & Cooper, D. (2010). Coercive or Corro-
ters.com/world/americas/exclusive-venezuela-de- sive: The Negative Impact of Economic Sanctions
mands-prepayment-spot-oil-sales-after-buyer-de- on Democracy. International Interactions: Empirical
faults-2022-06-08/ and Theoretical Research in International Relations,
Parraga, M. (2022d, August 12). Exclusive: PDVSA 36(3), 240–264. https://doi.org/10.1080/0305062
pauses oil-for-debt shipments to Europe, wants 9.2010.502436
product swaps. Reuters. https://www.reuters. Peksen, D. (2009). Better or Worse? The Effect of Eco-
com/business/energ y/exclusive-pdvsa-pauses- nomic Sanctions on Human Rights. Journal of Peace
oil-for-debt-shipments-europe-wants-product- Research, 46(1), 59–77. http://www.jstor.org/sta-
swaps-2022-08-12/ ble/27640799
Parraga, M. (2022e, November 07). Italy’s Eni to resume Peksen, S. (2011). Economic Sanctions and Human Se-
taking Venezuelan oil after 4-month pause. Reuters. curity: The Public Health Effect of Economic Sanc-
https://www.reuters.com/business/energy/italys- tions. Foreign Policy Analysis, 7(3), 237–251. http://
eni-resume-taking-venezuelan-oil-after-4-month- www.jstor.org/stable/24909796
pause-2022-11-07/ Penfold, M. (2007). Clientelism and Social Funds: Evi-
Parraga, M. (2023a, March 21). Middlemen have left dence from Chávez’s Misiones. Latin American Poli-
Venezuela’s PDVSA with $2.12 billion in unpaid tics and Society, 49(4), 63–84. http://www.jstor.org/
bills. Reuters. https://www.reuters.com/business/ stable/30130824
energ y/middlemen-have-left-venezuelas-pdv- Penfold, M. (2018). Food, Technology, and Authoritar-
sa-with-212-billion-unpaid-bills-2023-03-21/ ianism in Venezuela’s Elections.The Wilson Center.
Parraga, M. (2023b, April 26). Unable to process Ven- https://www.wilsoncenter.org/sites/default/files/
ezuela’s heavy oil, Cuba turns to Russia, Mexico. media/documents/misc/penfold_venezuela_elec-
Reuters. https://www.reuters.com/business/energy/ tions_final.pdf
unable-process-venezuelas-heavy-oil-cuba-turns-rus- Penfold, M., & Arnson, C. (2023). Overcoming Barriers
238
to Humanitarian Aid in Venezuela. The Wilson Cen- com/images/DocumentosOficiales/comunicados/
ter. https://www.wilsoncenter.org/sites/default/ TOLLING_AGREEMENT_9_10_2020.pdf
files/media/uploads/documents/OVERCOM- Petróleos de Venezuela - PDVSA. (2020b, December
ING%20BARRIERS%20TO%20HUMANITAR- 13). Tolling Agreement. PDVSA. http://www.pdvsa.
IAN%20AID%20IN%20VENEZUELA.pdf com/images/DocumentosOficiales/comunicados/
Peñaloza-Pacheco, L. (2021). Living with the neighbors: comunicadodeextension11.11.2020_ENG.pdf
The effect of Venezuelan forced migration on the la- Petróleos de Venezuela - PDVSA. (2021a, Janu-
bor market in Colombia. Journal for Labour Market ary 13). Tolling Agreement. PDVSA. http://
Research, 56(4). https://static1.squarespace.com/ www.pdvsa.com/images/DocumentosOficiales/
static/609c48182747022f80ae9ed1/t/609db0d0e- comunicados/PdVSA_TOLLING_AGREE-
ce4d67fcb09179f/1620947220550/Migration.pdf MENT_07.12.2020ENG.pdf
Peri, G. (2012). Immigration, labor markets, and produc- Petróleos de Venezuela - PDVSA. (2021b, February
tivity. Cato Journal, 32(1). https://ciaotest.cc.colum- 13). Tolling Agreement. PDVSA. http://www.pdvsa.
bia.edu/journals/cato/v32i1/f_0024452_19953. com/images/DocumentosOficiales/comunicados/
pdf TOLLINGAGREEMENT_12_01_2021.pdf
Peri, G., & Sparber, C. (2009). Task Specialization, Im- Petróleos de Venezuela - PDVSA. (2023, March
migration, and Wages. American Economic Journal: 30). Tolling announcement. PDVSA. http://si-
Applied Economics,1(3). 135–169. http://www.jstor. tioeyp.pdvsa.com/index.php?option=com_con-
org/stable/25760175 tent&view=article&id=9840:tolling-announce-
Pescatore v. Pineda, 345 F. Supp. 3d 68 (D.D.C. 2018). ment&catid=10:news&Itemid=908&lang=en
Petroguía. (2020, April 29). Primero Justicia consid- Petróleos de Venezuela S.A. v. Juan Guaidó. 399 F. Supp.
era errada estrategia de Guaidó con bonos PDVSA 3d 404. (2019a)
2020. Petroguía. http://www.petroguia.com/pet/ Petróleos de Venezuela S. A. v. Juan Guaidó. 442 F.
noticias/petr%C3%B3leo/primero-justicia-consid- Supp. 3d 373. (2019b).
era-errada-estrategia-de-guaid%C3%B3-con-bo- Pharo Gaia Gund, Ltd. Et al. v. Bolivarian Republic of
nos-pdvsa-2020 Venezuela, Case No. 19-cv-3123, (S.D.N.Y., 2021).
Petroguía. (2023, February 26). Delcy Rodríguez Piña, A. (2022, September 5). Antonio Ecarri descar-
gestiona con la CAF agilizar préstamos para sec- ta su participación en las primarias de la Plataforma
tor eléctrico y canal de navegación del lago de Ma- Unitaria. El Informador. https://www.elinforma-
racaibo. Petroguía. http://www.petroguia.com/ dorve.com/05/09/2022/venezuela/antonio-ecarri-
pet/noticias/electricidad-sustentabilidad/delcy- no-se-medira-en-las-primarias-de-la-plataforma-uni-
rodr%C3%ADguez-gestiona-con-la-caf-agilizar- taria/
pr%C3%A9stamos-para Pons, C. (2018, April 27). Exclusive: Venezuela faces
Petróleos de Venezuela - PDVSA. (2020a, November heavy bill as grace period lapses on China loans –
13). Tolling Agreement. PDVSA. http://www.pdvsa. sources. Reuters. https://www.reuters.com/article/
239
us-venezuela-china-idUSKBN1HY2K0 blyde/
Pons, C., & Armas, M (2018, October 29). Venezuelan Primero Justicia (2023, May 24). Primero Justi-
Socialists seek dialogue, opposition rebuffs. Reuters. cia realiza foro y explica responsabilidad de Mad-
https://www.reuters.com/article/us-venezuela-poli- uro en endeudamiento de CITGO [Press re-
tics-idUSKCN1N32EU lease]. http://www.primerojusticia.org.ve/cms/
Pons, C., & Armas, M. (2020, August 12). Exclusive: index.php?view=item&cid=148:rotator-arti-
Venezuela wins grace period on China oil-for-loan cles&id=43404:primero-justicia-realiza-foro-y-ex-
deals, sources say. Reuters. https://www.reuters. plica-responsabilidad-de-maduro -en-endeu-
com/article/us-venezuela-china-exclusive-idUSKC- damiento-de-CITGO&pop=1&tmpl=compo-
N2581UN nent&print=1
Prensa AN. (2019a, December 3). AN difiere Proyecto Primicia (August 28, 2020). CLAP llegó a 7 millones de
de Asistencia Financiera para atender emergen- familias. Primicia. https://primicia.com.ve/nacion/
cia humanitaria del sector eléctrico [Press release]. clap-llego-a-7-millones-de-familias/
Asamblea Nacional de Venezuela. https://www. Procuraduría Especial de la República de Venezuela [@
asambleanacionalvenezuela.org/noticias/an-di- DeProcuraduria]. (2020, May 12). The Office of the
fiere-proyecto-de-asistencia-financiera-para-aten- Special Attorney General recommends starting an in-
der-emergencia-humanitaria-del-sector-electrico vestigation on the disposal of controlling stake of PDVSA
Prensa AN. (2019b, December 10). Asamblea Nacional in Nynas AB [Tweet]. Twitter. https://twitter.com/
aprueba acuerdo que reconoce crisis humanitaria en DeProcuraduria/status/1260288249638998016
Zulia debido fallas eléctricas. https://asambleanacio- Programa Venezolano de Educación Acción en Dere-
nalvenezuela.org/noticias/asamblea-nacional-aprue- chos Humanos (PROVEA) (2016, November 4).
ba-acuerdo-que-reconoce-crisis-humanitaria-en-zu- Especial | Los CLAP: 7 indicios de discriminación
lia-debido-fallas-electricas política. https://provea.org/trabajos-especiales/es-
Prensa AN. (2023, January 19). Asamblea Nacional peciales/los-clap-7-indicios-de-discriminacion-po-
legítima de Venezuela designó Comité de Adminis- litica/
tración y Protección de Activos en el Exterior [Press Programa Venezolano de Educación Acción en Dere-
release]. Asamblea Nacional de Venezuela. https:// chos Humanos (PROVEA) (2022, April 14). Especial
www.asambleanacionalvenezuela.org/noticias/ | Lo que padecen quienes dependen de la electricidad
asamblea-nacional-legitima-de-venezuela-desig- en Venezuela. https://provea.org/actualidad/espe-
no-comite-de-administracion-y-proteccion-de-acti- cial-lo-que-padecen-quienes-dependen-de-la-electri-
vos-en-el-exterior cidad-en-venezuela/
Primeraedicioncol. (2023, January 12). El toma y Puerta, J., Ferreyra, G., Taddia, A., & Castellani, F.
dame de Leopoldo López con Gerardo Blyde. Prime- (2023). Development Lending for a New Reality: The
ra Edición COL. https://primeraedicioncol.com/ Evolution of Financing Instruments across Multilater-
el-toma-y-dame-de-leopoldo-lopez-con-gerardo- al Development Banks. Inter-American Development
240
Bank. http://dx.doi.org/10.18235/0004762 terino-acuerda-con-junta-ad-hoc-del-bcv-presta-
Punto De Corte. (2019, December 5). (+Proyecto de mo-de-80-millones/
Ley) Un “acuerdo” por financiamiento de la CAF re- R4V. (2021). Refugiados y Migrantes Venezolanos en la
vuelve aguas. Punto De Corte. https://puntodecorte. Región. R4V. https://www.r4v.info/sites/default/
net/proyecto-de-ley-un-acuerdo-con-el-regimen-pa- files/2021-06/R4V_Stock_Jun21_Esp.pdf
ra-obtener-financiamiento-de-la-caf-revuelve-aguas- Radio Fe y Alegría. (2023, February 25). Primero Ven-
en-la-an-en-medio-de-entramado-de-corrupcion/ ezuela sobre Primaria : Nos negaron el decrecho a
Pulido, J., & Varón A. (2020). Misallocation of the Im- partaicipar. Primacia. https://primicia.com.ve/na-
migrant Workforce: Aggregate Productivity Effects cion/primero-venezuela-sobre-primaria-nos-nega-
for the Host Country. Borradores de Economia 1135. ron-el-derecho-a-participar/
https://doi.org/10.32468/be.1135 Raffali, S., & Villalobos, C. (2021). Recent Patterns of
Qazi, S. (2022, November 22). Trust responsible for Stunting and Wasting in Venezuelan Children: Pro-
seized Afghan money meets in Geneva What would gramming Implications for a Protracted Crisis. Fron-
you like to learn more about?. TRT World. https:// tiers, 5. https://doi.org/10.3389/fsufs.2021.638042
www.trtworld.com/magazine/trust-responsible-for- Ramírez, J. (2021). Migrantes venezolanos en Co-
seized-afghan-money-meets-in-geneva-62781 lombia: principales efectos macroeconómicos (Pu-
Queaq, E. (2019). The effects economic integration of mi- blication No. 936) [Thesis, Universidad de los
grants have on the economy of host countries. Institute Andes]. https://repositorio.uniandes.edu.co/han-
of Development Studies (IDS). dle/1992/53916?show=full
Quesada, J. D. (2023, March 28). Maduro volverá a Ramsey, G., & Martinez-Gugerli, K. (2021). THE CRI-
la mesa de México si se liberan los activos en el ex- SIS CAN’T WAIT: How U.S. Policymakers Can Sup-
tranjero y recibe licencias para vender petróleo. El port Humanitarian Accords in Venezuela. WOLA.
País. https://elpais.com/internacional/2023-03-28/ https://www.wola.org/analysis/how-us-policymak-
maduro-volvera-a-la-mesa-de-mexico-si-se-liberan- ers-can-support-humanitarian-accords-venezuela/
los-activos-en-el-extranjero-y-recibe-licencias-para- Redacción BBC Mundo. (2017, May 1). El presidente
vender-petroleo.html Nicolás Maduro convoca a una Asamblea Nacional
Quesada, J. D. (2022, November 22). El Gobierno y la Constituyente en Venezuela. BBC Mundo. https://
oposición venezolana vuelven a la mesa de diálogo www.bbc.com/mundo/noticias-america-lati-
en México este fin de semana. El País. https://elpais. na-39774863
com/internacional/2022-11-23/el-gobierno-y-la- Redacción BBC Mundo. (2022, August 12). Colombia
oposicion-venezolana-vuelven-a-la-mesa-de-dialo- y Venezuela: los gobiernos de Maduro y Petro nom-
go-en-mexico-este-fin-de-semana.html bran embajadores y avanzan en la normalización de
Quintero, L. (2020, June 23). Gobierno interino acuerda relaciones. BBC Mundo. https://www.bbc.com/
con junta ad hoc del BCV préstamo de $80 millones. mundo/noticias-america-latina-62514599
Tal Cual. https://talcualdigital.com/gobierno-in- Redacción Internacional. (2019, January 14). El
241
polémico préstamo de la CAF a Maduro. El Espect- Reuters Staff. (2021b, April 19). Programa Mundial de
ador. https://www.elespectador.com/mundo/amer- Alimentos y Venezuela acuerdan suministrar comida
ica/el-polemico-prestamo-de-la-caf-a-maduro-arti- a 185.000 niños. Reuters. https://www.reuters.com/
cle-833958/ article/venezuela-politica-pma-idLTAKBN2C62R4
Reddy, S., & Minoiu, C. (2009). Real Income Stag- Reuters Staff. (2023, May 16). Venezuela’s state oil firm
nation of Countries 1960–2001. The Journal of restarts distillation unit at El Palito refinery -sources.
Development Studies, 45(1), 1-23, https://doi. Reuters. https://www.reuters.com/article/venezue-
org/10.1080/00220380802265249 la-oil-refinery-idUKL8N37D4X9
Repsol. (2022). Informe financiero anual 2022. Gru- Reuters. (2018, December 17). Venezuela seeks $4
po REPSOL. https://www.repsol.com/content/ bln loan from regional bank CAF -sources. Reu-
dam/repsol-corporate/es/accionistas-e-inversores/ ters. https://www.reuters.com/article/venezue-
informes-anuales/2022/informe-financiero-anu- la-caf-idUSL1N1YM12J
al-consolidado-2022.pdf Reuters. (2021a, September 27). They yell ugly things:
Republic of Venezuela v. Juan Guaidó. Case No. 1:20- migrants in Chile’s north fearful after fiery protests.
cv-01925. (2019). Resolution 986 (1995) / adopted Reuters. https://www.reuters.com/world/americas/
by the UNSC at its 3519th meeting, on 14 April they-yell-ugly-things-migrants-chiles-north-fearful-
1995. after-fiery-protests-2021-09-27/
Reuters Staff. (2019, December 13). Sanctions-hit refin- Reuters. (2021b, September 15). U.S. denies Crystallex
er Nynas handed administrator by Swedish court. Re- request for CITGO shares, will reassess in 2022.
uters. https://www.reuters.com/article/us-nynas-re- Reuters. https://www.reuters.com/business/us-de-
construction-idUSKBN1YH20A nies-crystallex-request-CITGO-shares-will-reas-
Reuters Staff. (2018, August 20). Venezolana PDVSA sess-2022-2021-09-15/
reanudará uso de terminal en San Eustaquio tras Reuters. (2022a, February 14). Afghan central bank
acuerdo de pago a NuStar. Reuters. https://www. says U.S. plan for frozen funds an ‘injustice’. Reuters.
reuters.com/article/petroleo-pdvsa-nustar-idL- https://www.reuters.com/markets/funds/afghan-
TAKCN1L5271-OUSLB central-bank-says-us-plan-frozen-funds-an-injus-
Reuters Staff. (2020, March 23). EU to provide 20 tice-2022-02-12/
mln euros in humanitarian aid to Iran. Reuters. Reuters. (2022b, August 11). Argentina orders sei-
https://www.reuters.com/article/health-corona- zure of Venezuelan plane at U.S. request. Reu-
virus-eu-iran-idUSL8N2BG6OK ters. https://www.reuters.com/world/americas/
Reuters Staff. (2021a, March 25). Maduro dice que argentina-orders-seizure-venezuelan-plane-us-re-
a Venezuela ingresarán solo las vacunas autoriza- quest-2022-08-12/
das. Reuters. https://www.reuters.com/article/sa- Reuters. (2022c, September 15). Taliban condemn
lud-coronavirus-venezuela-vacunas-idESKBN2BH- U.S. move to form Swiss-based trust for Afghan
0MO central bank funds. Reuters. https://www.reuters.
242
com/world/asia-pacific/taliban-condemn-us- ble/20032580
move-form-swiss-based-trust-afghan-central-bank- Rodríguez, F. (2018). Crude Realities: Understanding
funds-2022-09-15/ Venezuela’s Economic Collapse. WOLA. https://
Reuters. (2022d, October 11). U.S. judge approves sales www.venezuelablog.org/crude-realities-understand-
process for shares in CITGO Petroleum’s parent. ing-venezuelas-economic-collapse/
Reuters. https://www.reuters.com/markets/us/us- Rodríguez, F., & Navarro, P. (2018, February 14). ¿Cómo
judge-approves-sales-process-shares-CITGO-petro- moviliza votos el chavismo?. Prodavinci. https://
leums-parent-2022-10-11/ prodavinci.com/como-moviliza-votos-el-chavismo/
Reuters. (2023, January 6). Venezuela owes over $20 Rodríguez, F. (2019). Sanctions and the Venezuelan
million to law firms on guarding overseas assets. Economy: what the data say. Latam Economics
Reuters. https://www.reuters.com/world/americas/ Viewpoint. https://torinocap.com/wp-content/
venezuela-owes-over-20-mln-law-firms-guarding- uploads/2019/06/Sanctions-and-Vzlan-Economy-
overseas-assets-2023-01-06/ June-2019.pdf
Rodolfo Enrique Jiménez et al. v. Luisa Palacios et al. Rodríguez, F. [@frrodriguezc]. (2020, April 21).
Case No. 2019-0490-KSJM. (2019). https://law.jus- Recomendamos una transferencia de $100 por familia
tia.com/cases/delaware/court-of-chancery/2019/c- para emigrantes venezolanos ($500 en países desar-
a-no-2019-0490-ksjm-0.html rollados). El programa no requiere acuerdo con el ofi-
Rodríguez, F., & Guerrero, G. (2020). Toward sustain- cialismo y puede ser aprobado por la @AsambleaVE.
able human development in Venezuela: diagnosis, #JuntosSomosMás. [Tweet]. Twitter. https://twitter.
challenges and economic strategy. Revista Tempo do com/frrodriguezc/status/1252564965413847041
Mundo. https://doi.org/10.38116/RTM23ART11 Rodríguez, F. (2021a). Venezuela’s economic collapse:
Rodríguez, F., & Hausmann, R. (2012). Venezuela Be- implications for Latin America and the Caribbe-
fore Chávez: Anatomy of an Economic Collapse. The an. https://franciscorodrigueznet.files.wordpress.
Pennsylvania State University Press. com/2021/02/venezuela-lac.pdf
Rodríguez, F., & Rodríguez, J. A. (2019, March 26). Rodríguez, F. (2021b, October 15). ¿Se ha debilita-
Venezuela´s Powerless Revolution. The New York do la defensa de activos durante el gobierno interino?
Times. https://www.nytimes.com/2019/03/26/ Francisco Rodríguez Website. https://franciscoro-
opinion/venezuela-maduro-blackout.html driguez.net/2021/10/15/se-ha-debilitado-la-defen-
Rodríguez, F., & Sachs, J. (1999). Why Do Re- sa-de-activos-durante-el-gobierno-interino/
source-Abundant Economies Grow More Slowly? Rodríguez, F. (2021c). Toxic conflict: understanding
Journal of Economic Growth, 4 (3), 277–303. http:// Venezuela’s economic collapse. Kellog Institute, 466.
www.jstor.org/stable/40216009 https://kellogg.nd.edu/sites/default/files/working_
Rodríguez, F. (2008). An Empty Revolution: The papers/Rodriguez%20WP%20446%20FINAL3_0.
Unfulfilled Promises of Hugo Chávez. Foreign pdf
Affairs, 87(2), 49–62. http://www.jstor.org/sta- Rodríguez, F. (2021d, November 17). What should be
243
done with Venezuela’s interim government? Francis- American Perspectives.
co Rodríguez Website. https://franciscorodriguez. Rodríguez, F., & Imam, P. (2022). Political Growth
net/2021/11/17/what-should-be-done-with-vene- Collapses. SSRN. https://dx.doi.org/10.2139/
zuelas-interim-government/#_ftn4 ssrn.4153885
Rodríguez, F. (2022a). Sanctions and Oil Production: Rodríguez, M. (2019, February 6). MAPA: ¿Qué
Evidence from Venezuela’s Orinoco Basin. Lat- países reconocen a Guaidó y cuáles a Maduro como
in American Economic Review, 31(6). https://doi. presidente de Venezuela?. Euronews. https://es.eu-
org/10.47872/laer.v31.33 ronews.com/2019/01/24/mapa-que-paises-recon-
Rodríguez, F. (2022b). Sanctions, Economic Statecraft, ocen-a-guaido-y-cuales-a-maduro-como-presiden-
and Venezuela’s Crisis. Sanctions and Security Re- te-de-venezuela
search Project. https://sanctionsandsecurity.org/ Rodríguez, R. (2023, November 28). Gerardo Blyde:
wp-content/uploads/2022/01/January-2022-Vene- El acuerdo social no es la negociación, es el rein-
zuela-Case_Rodriguez.pdf icio del proceso. Efecto Cocuyo. https://efectoco-
Rodríguez, F. (2022c). What Venezuela’s Opposition cuyo.com/politica/gerardo-blyde-el-acuerdo-so-
Can Learn from the Barinas Victory. Global Ameri- cial-no-es-la-negociacion-es-el-reinicio-del-proceso/
cans. https://theglobalamericans.org/2022/01/ven- Rodrik, D. (1999). Where Did All the Growth Go?
ezuela-opposition-barinas/ External Shocks, Social Conflict, and Growth Col-
Rodríguez, F. (2022d). Sanctions and Imports of Essen- lapses. Journal of Economic Growth, 4(4), 385–412.
tial Goods: A Closer Look at the Equipo Anova (2021) https://doi.org/10.1023/a:1009863208706
Results. http://dx.doi.org/10.2139/ssrn.4298623 Rojas, A. (2023). Chevron está generando dólares
Rodríguez, F. (2022e, November 1). To Halt the y produce bolívares no inflacionarios. Petroguía.
Venezuelan Migration Crisis, Stop Banning Ven- ht tp : / / w w w.p e tro g u i a . c o m / p e t / n o ti c i a s /
ezuelan Oil. Foreign Policy. https://foreignpoli- p etr%C3%B3le o/%E2%80%9Cche vron- es-
cy.com/2022/11/01/maduro-venezuela-migra- t%C3%A1-generando-d%C3%B3lares-y-pro-
tion-crisis-sanctions-ban-oil/ duce-bol%C3%AD vares-no -inflacionari-
Rodriguez, F. (2023a). The Human Consequences of os%E2%80%9D
Economic Sanctions. Center for Economic and Pol- Rolfe, H., Rienzo, C., Lalani, M., & Portes, J. (2013).
icy Research. https://cepr.net/wp-content/up- Migration and productivity: employers’ practices, pub-
loads/2023/04/FINAL-The-Human-Consequenc- lic attitudes and statistical evidence. National Institute
es-of-Economic-Sanctions-Rodriguez-7.pdf of Economic and Social Research (NIESR).
Rodríguez, F. (2023b). Scorched Earth the Political Rubio, M. (2016, June 11). Aseguró Freddy Bernal|“Los
Economy of Venezuela’s Collapse, 2012-2020. Unpub- Clap no pertenecen a ningún partido político, son
lished manuscript. instrumentos para fortalecer el Poder Popular”.
Rodríguez, F. (2023c). The economic determinants Correo del Orinoco. http://www.correodelorinoco.
of Venezuela´s hunger crisis. Forthcoming, Latin gob.ve/%e2%80%9clos-clap-no-pertenecen-a-ni-
244
ngun-partido-politico-son-instrumentos-para-for- Shah Mehrabi. [Video]. YouTube. https://www.you-
talecer-poder-popular%e2%80%9d/ tube.com/watch?v=43wHU4M9uXE
Runrun.es (2021, September 27). Jorge Rodríguez acusa Scull, C. [@carlosscull]. (2020, April 2). Nuestro pro-
a la oposición de pretender “pretender” quebrar el di- grama de “alimentación solidaria” para la comunidad
alogo por casos de Monómeros y CITGO. RunRun. venezolana en Perú continúa. Hasta el día de ayer he-
es. https://runrun.es/noticias/454953/jorge-rodri- mos beneficiado a 1073 familias y hemos comenzado
guez-acusa-a-la-oposicion-de-pretender-quebrar-el- a entregar las 500 cestas otorgadas por Caritas Perú.
dialogo-por-casos-monomeros-y-CITGO/ (1/5). [Tweet]. Twitter. https://twitter.com/carloss-
Runrun.es. (2022, December 7). Lo que se ha dicho y lo cull/status/1245790593340538882
que no está claro del fondo de $3,000 millones acor- Section 25B. Act 12 USC 632 (1993) https://www.fed-
dado en el diálogo que manejará la ONU. Runrun.es. eralreserve.gov/aboutthefed/section25b.htm
https://runrun.es/noticias/490381/lo-que-se-ha- Sequera, E. (2021, December 28). Sánchez Falcón:
dicho-y-lo-que-no-esta-claro-del-fondo-de-3000- “La reforma al Estatuto para la transición será nega-
millones-acordado-en-el-dialogo-que-manejara-la- da o modificada”. Politiks. https://politiks.co/san-
onu/ chez-falcon-la-reforma-al-estatuto-para-la-transici-
Rusoro Mining. (2022). 2022 third quarter manage- on-sera-negada-o-modificada/
ment discussion and analysis. Rusoro Mining. http:// Sequera, V., Spetalnick, M., & Parraga, M. (2022,
rusoro.com/i/pdf/2022-09-30-RML-q3-MDA-Fi- May 17). Venezuela’s Maduro, opposition expect-
nal.pdf S.2142 - 113th Congress (2013-2014): Ven- ed to talk; U.S. eases some sanctions -sources. Reu-
ezuela Defense of Human Rights and Civil Society ters. https://www.reuters.com/world/americas/
Act of 2014. (2014, December 18). https://www. talks-between-venezuelas-maduro-opposition-ex-
congress.gov/bill/113th-congress/senate-bill/2142 pected-us-easing-some-restrictions-2022-05-17/
Sak H., G. W. (2022, October 25). How a portion of Sequera, V., & Ellsworth, B. (2020). Líder opositor
Afghanistan’s foreign reserves ended up in Geneva. Guaidó busca que Europa frene tráfico de “oro de
Swissinfo. https://www.swissinfo.ch/eng/how-a- sangre” venezolano. Reuters. https://www.reuters.
portion-of-afghanistan-s-foreign-reserves-ended- com/article/venezuela-politica-guaido-idLTAKB-
up-in-geneva/47994058 N1Z82HT
Schaeffer, K. (2022, August 17). A year later, a look back Shagabutdinova, E., & Berejikian, J. (2007). Deploy-
at public opinion about the U.S. military exit from ing Sanctions while Protecting Human Rights: Are
Afghanistan. Pew Research Center. https://www. Humanitarian “Smart” Sanctions Effective?. Jour-
pewresearch.org/fact-tank/2022/08/17/a-year-lat- nal of Human Right, 6(1), 59 – 74. https://doi.
er-a-look-back-at-public-opinion-about-the-u-s-mil- org/10.1080/14754830601098386
itary-exit-from-afghanistan/ Simoes, L. (2019, March 22). Venezuela tenta retirar
Schiller Institute. (2021, December 18). U.S. Policy Is 1,5 mil milhões de euros do Novo Banco. O Jornal
‘Suffocating the Afghan People’ — Interview with Dr. Económico. https://jornaleconomico.pt/noticias/
245
venezuela-tenta-retirar-15-mil-milhoes-de-eu- (FARC), 16 Misc. 405 (LGS) (SN) (S.D.N.Y. Dec.
ros-do-novo-banco-424869 21, 2022).
Singer, F. (2021, December 17). Un fallo de energía Swissinfo. (2022, September 14). Swiss foundation to
deja sin luz a al menos 19 de los 23 Estados de Ven- manage frozen Afghanistan funds. Swissinfo. https://
ezuela. El País. https://elpais.com/internacion- www.swissinfo.ch/eng/swiss-foundation-to-man-
al/2021-12-17/un-fallo-de-energia-deja-sin-luz-a- age-frozen-afghanistan-funds/47900974
al-menos-19-de-los-23-estados-de-venezuela.html TalCual. (2022, November 23). María Corina Mach-
Sistema Patria (n.d.). https://www.patria.org.ve/ ado pide a la Comisión de Primaria garantizar voto
Siverio, J. (February 15, 2023). Copei y Avanzada Pro- en el exterior. Tal Cual. https://talcualdigital.com/
gresista no participarán en primarias opositoras. maria-corina-machado-pide-a-la-comision-de-pri-
Correo del Caroní. https://correodelcaroni.com/ maria-garantizar-voto-en-el-exterior/
pais-politico/copei-y-avanzada-progresista-no-par- TalCual. (2021, June 14). Venezuela en camino de otro
ticiparan-en-primarias-opositoras/ apagón nacional: «más fuerte que el de 2019». Tal
Smith, J. (1987). Trade Credit and Informational As- Cual. https://talcualdigital.com/venezuela-en-cami-
symetry. The Journal of Finance, 42(4), 863–872. no-de-otro-apagon-nacional-mas-fuerte-que-el-
https://doi.org/10.2307/2328295 de-2019/
Solís, J., Warren, S., Meriggi, N., Scacco, A., McMurry, TankerTranckers.com. (2023). Data Monthly Export by
N., Voors, M., Syunyaev, G. et al. (2021). COVID-19 Country [Dataset]. TankerTranckers. https://tanker-
vaccine acceptance and hesitancy in low- and mid- trackers.com/report
dle – income countries. Nature Medicine 27, 1385 Terziev, T., & Can, H. (2018). The Relations Between
– 1394. https://doi.org/10.1038/s41591-021- the Migration, Population Aging, Labor Force Pro-
01454-y ductivity and Economic Growth: An Analysis for
Souquett, M. (2021, June 14). Venezuela y Covax: lo Bulgaria. IJASOS- International E-Journal of Ad-
avanzado y lo que falta para la llegada de las vacunas. vances in Social Sciences, 4(10), 77-83.
Efecto Cocuyo. https://efectococuyo.com/salud/ven- TeleSur. (2018, February 16). Venezuela: Operación
ezuela-y-covax-claves-llegada-de-vacunas-covid-19/ “Ataque al Gorgojo” ha dejado 55 detenidos. TeleSur.
Splinter, M., & Klomp, J. (2021). Do Sanctions Cause https://www.telesurtv.net/news/Venezuela-Op-
Economic Growth Collapses? In R. Beeres, R. Ber- eracion-Ataque-al-Gorgojo-ha-dejado-55-deteni-
trand, J. Klomp, J. Timmermans, & J. Voetelink dos-20160218-0017.html
(Eds.), NL ARMS Netherlands Annual Review of The Carter Center. (2020). Navigating Humanitarian
Military Studies 2021: Compliance and Integri- Exceptions to Sanctions Against Syria. The Carter
ty in International Military Trade (pp. 115-132). Center. https://www.cartercenter.org/resources/
The Hague: T.M.C. Asser Press. http://dx.doi. pdfs/peace/conflict_resolution/syria-conflict/nav-
org/10.1007/978-94-6265-471-6_7 igating-humanitarian-exceptions-in-syria-oct2020.
Stansell v. Revolutionary Armed Forces of Colom. pdf
The Economist. (1977). The Dutch Disease. The Econ- Transparencia Venezuela. (2017). Alimentos Dis-
omist. https://www.uio.no/studier/emner/sv/oe- tribuidos por los Clap No Cubren las Necesidades
konomi/ECON4925/h08/undervisningsmateri- Alimentarias de los venezolanos. Transparencia
ale/DutchDisease.pdf Venezuela. https://transparenciave.org/alimen-
The Rome Declaration on World Food Security (1996). tos-distribuidos-por-los-clap-no-cubran-las-necesi-
FAO. https://www.fao.org/3/w3613e/w3613e00. dades-alimentarias-de-los-venezolanos/
htm Transparencia Venezuela. (2020). Los CLAP: la dom-
Thomas, C. (2021). U.S. Military Withdrawal and Tali- inación se entrega puerta a puerta. Transparencia
ban Takeover in Afghanistan: Frequently Asked Ques- Venezuela. https://transparenciave.org/project/
tions. Congressional Research Service. https://crsre- los-clap-la-dominacion-se-entrega-puerta-puerta/
ports.congress.gov/product/pdf/R/R46879 Transparencia Venezuela. (2020a). The China Deals.
Thomson Reuters. (2023). Glossary. Thomson Re- Transparencia Venezuela. https://transparenciave.
uters. https://uk.practicallaw.thomsonreuters. org/wp-content/uploads/2020/10/The-Chi-
com/0-504-9398?transitionType=Default&contex- na-Deals-Transparencia-Venezuela-oct-2020.pdf
tData=(sc.Default)&firstPage=true Transparencia Venezuela. (n.d). Transparencia Venezue-
ToloNews [@ToloNews]. (2022, December 4). Shah la presenta sus dudas sobre nuevo endeudamiento para
Mohammad Mehrabi, a member of the Afghan Cen- el sector eléctrico. Transparencia Venezuela. https://
tral Bank’s supreme council and trustee of the Afghan transparenciave.org/transparencia-venezuela-pre-
fund in Switzerland, has confirmed he will travel to senta-sus-dudas-sobre-nuevo-endeudamiento-pa-
Kabul on Monday and attend a two-day meeting of ra-el-sector-electrico/
the council [Tweet]. Twitter. https://twitter.com/ Trenee, A. (2023, May 7). House Republicans to vote
TOLOnews/status/1599402622670508032 Thursday on border security package as Title 42
Toosi, N. (2019). How Trump’s ‘weaponized’ use of ends. CNN. https://edition.cnn.com/2023/05/07/
foreign aid is backfiring. Politico. https://www. politics/title-42-border-security-package-vote/in-
politico.com/story/2019/06/30/trump-foriegn- dex.html
aid-1390417 Turkewitz, J., & Kanno-Youngs, Z. (2022). U.S. Allows
Torres, A. (2021, February 3). En 2020 la caja CLAP Chevron to Expand Energy Operations in Vene-
solo llegó a 38 % de los hogares con un peso prome- zuela. The New York Times. https://www.nytimes.
dio de 8 kilos. Crónica uno. https://cronica.uno/en- com/2022/11/26/world/americas/venezuela-chev-
2020-la-caja-clap-solo-llego-a-38-de-los-hogares- ron-oil-us.html
con-un-peso-promedio-de-8-kilos/ U.S. Department of Justice Letter Crystallex Interna-
TotalEnergies. (2021). Venezuela: TotalEnergies exits tional Corp. v. Bolivarian Republic of Venezuela,
from Petrocedeño [Press release]. https://totalener- No. 17-151-LPS, (2023). https://ultimasnoticias.
gies.com/media/news/press-releases/venezuela-to- com.ve/wp-content/uploads/2023/05/DoJ-Let-
talenergies-exits-petrocedeno ter-1.pdf
U.S. Department of State (n.d). Syria Sanctions. U. S. Upon Resumption of Mexico City Talks [Press Re-
Department of State. https://www.state.gov/syr- lease]. https://home.treasury.gov/news/press-releas-
ia-sanctions/ es/jy1127
U.S. Department of the Treasury (n.d.a). Afghan- U.S. Energy Information Administration (EIA). (2023).
istan-Related Sanctions. U. S. Department of U.S. Imports by Country of Origin [Dataset]. https://
the Treasury. https://ofac.treasury.gov/sanc- www.eia.gov/dnav/pet/pet_move_impcus_a2_
tions-programs-and-countr y-information/af- nus_ep00_im0_mbbl_m.htm
ghanistan-related-sanctions#:~:text=The%20 U.S. Securities and Exchange Commission. (2017).
Afghanistan%2DRelated%20Sanctions%20pro- Exhibit D: Bolivarian Republic of Venezuela. ED-
gram,statutes)%20passed%20by%20The%20Con- GAR System. https://www.sec.gov/Archives/
gress. edgar/data/103198/000119312517376486/
U.S. Department of the Treasury. (n.d.b). Sanctions d505622dex99d.htm
Programs and Country Information. U. S. Depart- UCAB. (2022, November). Condiciones de vida de los
ment of the Treasury. https://home.treasury.gov/ venezolanos ENCOVI 2022. UCAB. https://as-
policy-issues/financial-sanctions/sanctions-pro- sets.website-files.com/5d14c6a5c4ad42a4e794d-
grams-and-country-information 0f7/636d0009b0c59ebfd2f24acd_Presenta-
U.S. Department of the Treasury. (n.d.c). Venezuela cion%20ENCOVI%202022%20completa.pdf
sanctions Frequently Asked Questions: 1581. U. S. UCABve. (November 10, 2022). Presentación de re-
Department of the Treasury. https://home.treasury. sultados: Encuesta Nacional de Condiciones de Vida
gov/policy-issues/financial-sanctions/faqs/top- (ENCOVI) 2022. [Video]. YouTube. https://www.
ic/1581 youtube.com/watch?v=-tVJIYEHdKk
U.S. Department of the Treasury. (n.d.d). Venezuela UK Government. (2022). UK statement on further eco-
sanctions Frequently Asked Questions: 817. U. S. De- nomic sanctions targeted at the Central Bank of the
partment of the Treasury. https://ofac.treasury.gov/ Russian Federation [Press release]. https://www.
faqs/817 gov.uk/government/news/uk-statement-on-further-
U.S. Department of the Treasury. (2020, June 18). Trea- economic-sanctions-targeted-at-the-central-bank-
sury Targets Sanctions Evasion Network Supporting of-the-russian-federation
Corrupt Venezuelan Actors [Press release]. https:// Ulmer, A., Graham, D., & Spetalnick, M. (2021, No-
home.treasury.gov/news/press-releases/sm1038 vember 15). EXCLUSIVE Mexico considers tighter
U.S. Department of the Treasury. (2022a, November entry rules for Venezuelans after U.S. requests -sources.
21). Readout of Fund for the Afghan People Board Reuters. https://www.reuters.com/world/americas/
Meeting. U. S. Department of the Treasury. https:// exclusive-mexico-considers-tighter-entry-rules-ve-
home.treasury.gov/news/press-releases/jy1122 nezuelans-after-us-requests-2021-11-12/
U.S. Department of the Treasury. (2022b, November UN Security Council Resolution 1153. http://unscr.
26). Treasury Issues Venezuela General License 41 com/en/resolutions/1153
248
UN Security Council Resolution 1175. https://digi- https://www.reuters.com/business/energ y/che-
tallibrary.un.org/record/255785?ln=en vron-could-raise-oil-output-venezuela-by-50-ceo-
UN Security Council Resolution 1284. https://www. says-2023-04-28/
un.org/Depts/unscom/Keyresolutions/sres99-1284. Valores Mundiales, S.L. and Consorcio Andino, S.L. v
htm Bolivarian Republic of Venezuela (Case No 1:23-mc-
UN Security Council Resolution 1293.http://unscr. 00298), (D.C. 2023). Memorandum order.
com/en/resolutions/1293 Van Bergeijk, P. (2015). Sanctions against Iran – A pre-
UN Security Council Resolution 1483. https://digitalli- liminary economic assessment. In Iana Dreyer, José
brary.un.org/record/495555?ln=en#:~:text=De- Luengo-Cabrera (eds), On target? EU sanctions as se-
cides%20that%20all%20Member%20States,of%20 curity policy tools, 49 – 56. doi:10.2815/710375
prohibitions%20related%20to%20the Vasquez, A., Bernstein, B., & Zerpa, F. (2020, March
UNHCR (2022, March 29). Number of Venezue- 20). Rejected Venezuela Returns to IMF Seeking $1
lans crossing the Darien Gap soars. UNHCR The Billion in Aid. Bloomberg. https://www.bloomberg.
UN Refugee Agency. https://www.unhcr.org/ com/news/articles/2020-03-21/rejected-venezuela-
news/press/2022/3/6243298f4/number-venezue- returns-to-the-imf-seeking-1-billion-in-aid
lans-crossing-darien-gap-soars.html Vasquez, A. (2021). A rare Maduro-Guaidó deal could
United Nations Office for the Coordination of Human- unlock vaccines for Venezuela. Bloomberg. https://
itarian Affairs (OCHA). (2022). Plan de respuesta www.bloomberg.com/news/articles/2021-03-19/a-
humanitaria: Venezuela. OCHA. https://www.hu- rare-maduro-guaido-deal-could-unlock-vaccines-
manitarianresponse.info/sites/www.humanitarian- for-venezuela
response.info/files/documents/files/hrp_ven_2022- VenAnalytics. (2021, January 19). PDVH Sale Gets Yel-
23.pdf low Light [Private report]. VenAnalytics Venezuela
United Nations Office for the Coordination of Human- Weekly.
itarian Affairs (OCHA). (2019). Venezuela, Bolivar- Venezuela Admin. (2021, April 23). Venezuela WeeFood
ian Republic of 2019. OCHA. https://fts.unocha. Assistance to Children. Venezuelan politics and
org/countries/242/summary/2019 human rights. https://www.venezuelablog.org/
United Nations. (2019). UN News - Global perspec- venezuela-weekly-wfp-agreement-reached-to-pro-
tive, human stories. UN. https://news.un.org/en/ vide-food-assistance-to-children/
story/2019/08/1043981 Venezuela solidarity campaign. (2020, February). Brief-
US Census Bureau. (n.d.). CPS Historical Migration/ ing: The effects of the economic blockade of Venezuela
Geographic Mobility Tables [Data set]. https://www. [White Paper]. https://www.venezuelasolidarity.
census.gov/data/tables/time-series/demo/geograph- co.uk/wp-content/uploads/2020/06/Updated-
ic-mobility/historic.html briefing-18-02-2020-final-The-effects-of-the-eco-
Valle, S., & Parraga, M. (2023). Chevron could raise nomic-blockade-of-Venezuela-1774.pdf
oil output in Venezuela by 50%, CEO says. Reuters. Vera, L. (2021, October 14). ¿Cómo leer a Cred-
249
it Suisse?. Politika UCAB. https://politikaucab. Weisbrot, M. (2019). Pompeo: Sanctions Increase Pain
net/2021/10/14/como-leer-a-credit-suisse/ and Suffering in Venezuela (Pt 2/2). The Real News
Viana, J. [@josedeviana]. ( July 13, 2022). Señores: Network. https://therealnews.com/pompeo-sanc-
Presidente Ejecutivo de la CAF Coordinador Res- tions-increase-pain-and-suffering-in-venezue-
idente de las Naciones Unidas A través de los medios la-pt-2-2
de comunicación, hemos sido informados la CAF y la Wen, J. Xinxin Zhao, Q., & Chun-Ping, C. (2020). The
ONU han suscrito un acuerdo para invertir recursos Impact of International Sanctions on Energy Se-
en la recuperación de los servicios públicos. [Tweet]. curity. Energy and Environment, 32(3), 458–480.
Twitter. https://twitter.com/josedeviana/sta- https://doi.org/10.1177/0958305X20937686
tus/1547381705916432384 WFP. (2019). Food Consumption Score. World Food
VOA News. (2021, April 14). NATO to Cut Forces in Programme. https://resources.vam.wfp.org/da-
Afghanistan, Match US Withdrawal. VOA News. ta-analysis/quantitative/food-security/food-con-
https://www.voanews.com/a/usa_nato-cut-forc- sumption-score
es-afghanistan-match-us-withdrawal/6204555.html WOLA. (2020, September 1). 115 Venezuelan Orga-
Voz de América. (2023, January 20). Oposición de nizations and Individuals to the U.S. Government:
Venezuela podría mover fondos en pequeñas can- Don’t Cut off Diesel to Venezuela. WOLA. https://
tidades para evitar acreedores: fuentes. Voz de www.wola.org/2020/09/diesel-sanctions-venezue-
América. https://www.vozdeamerica.com/a/ la-letter/
oposicion- de-vene zuela -podria -mover-fon- Wong, E. (2019). Venezuelan Opposition Leader
dos-en-pequenas-cantidades-para-evitar-acree- Guaidó Controls U.S. Bank Accounts, State Dept.
dores-fuentes/6927236.html Says. The New York Times. https://www.nytimes.
Warburton, C. (2016). The International Law and Eco- com/2019/01/29/us/politics/venezuela-bank-ac-
nomics of Coercive Diplomacy: Macroeconomic Ef- counts-guaido-pompeo.html
fects and Empirical Findings. Applied Econometrics Wood, R. (2008). A Hand upon the Throat of the
and International Development, 16(1), 35 – 52. Nation’: Economic Sanctions and State Repres-
Weber, P., & Schneider, G. (2019). Post-ColdWar sanc- sion, 1976–2001. International Studies Quarterly,
tioning by the EU, the UN, and the US: Introduc- 52(3), 489–513. https://doi.org/10.1111/j.1468-
ing the EUSANCT [Dataset]. Conflict Manage- 2478.2008.00512.x
ment and Peace Science, 39(1), 1-18. https://doi. World Bank. (n.d). IDA Borrowing Countries: What is
org/10.1177/0738894220948729 IDA?, International Development Association. World
Weisbrot, M., & Sachs, J. (2019). Economic Sanctions as Bank. https://ida.worldbank.org/en/about/bor-
Collective Punishment: The Case of Venezuela [White rowing-countries
paper]. Center for Economic and Policy Research. World Bank. (2021, June 18). How Do the World’s Poor-
https://cepr.net/images/stories/reports/venezue- est Countries Get Help with their Biggest Challeng-
la-sanctions-2019-04.pdf es? Understanding IDA [Video]. YouTube. https://
250
www.youtube.com/watch?v=eKc_F_76y28 Yapur, N. (2021, January 21). Venezuela’s Access to Vac-
World Bank. (2021). COVAX and World Bank to cines Imperiled By Seized Virus Tests. Bloomberg.
Accelerate Vaccine Access for Developing Coun- h t t p s : / / w w w. b l o o m b e r g . c o m / n e w s / a r t i -
tries [Press release]. https://www.worldbank. cles/2021-01-21/venezuela-s-access-to-vaccines-im-
org/en/news/press-release/2021/07/26/co - periled-by-seized-virus-tests
vax-and-world-bank-to-accelerate-vaccine-ac- Yapur, N. (2023a, March 23). Refiner CITGO Valued
cess-for-developing-countries at $13.4B On Improved. Bloomberg.
World Food Programme. (2020, February 23). WFP Yapur, N. (2023b, August 8). Venezuela Opposition to
Venezuela Food Security Assessment Main Findings Push Back Deadline for Bonds Until 2028.
| Data Collected between July and September 2019. Bloomberg. https://www.bloomberg.com/
Relief Web. https://reliefweb.int/report/venezue- news/articles/2023-08-08/venezuela-oppo -
la-bolivarian-republic/wfp-venezuela-food-securi- sition-to -push-back-deadline-for-bonds-un-
ty-assessment-main-findings-data til-2028#xj4y7vzkg
World Food Programme. (2021, April 19). WFP to pro- Yi-Chang, H. (2020). The Impact of Migrant Labor on
vide school meals in Venezuela. https://www.wfp. Labor Productivity: Evidence from the United States
org/news/wfp-provide-school-meals-venezuela-0 and Europe [Bachelor’s Thesis, Oregon State Univer-
World Food Programme. (2022a, January 13). WFP ex- sity]
pands school meals programme in Venezuela. https:// Zakrison, T., & Muntaner, C. (2019). US sanctions in
www.wfp.org/news/wfp-expands-school-meals-pro- Venezuela: help, hindrance, or violation of human
gramme-venezuela rights?. Lancet, 393(10191), 2586-2587. https://
World Food Programme. (2022b, April 19). World doi.org/10.1016/S0140-6736(19)31397-2
Food Programme marks first anniversary of cooper- Zerpa, F., & Crowley, K. (2022, July 6). Chevron Looks
ation agreement with Venezuela. https://www.wfp. to Revamp Venezuela Oil Pact in Bid to Lift Output.
org/news/world-food-programme-marks-first-anni- Bloomberg. https://www.bloomberg.com/news/ar-
versary-cooperation-agreement-venezuela ticles/2022-07-06/chevron-looks-to-revamp-vene-
Wroughton, L., & Rampton, R. (2019, March 22). zuela-oil-pact-in-bid-to-lift-output
Exclusive: IADB cancels China meeting after Bei- Zerpa, F. (2022a). Chevron Could Boost Venezuelan
jing bars Venezuela representative. Reuters. https:// Oil Output 33% Without Sanctions. Bloomberg
www.reuters.com/article/us-venezuela-politics-chi- News.
na-iadb-exclusi-idUSKCN1R32NU Zerpa, F. (2022b, August 23). Maduro contrataría
Yapur, N., & Fieser, E. (2021, September 24). CITGO a Siemens para reconstruir centrales eléctricas.
Hires JPMorgan to Deal With Creditors Trying to Bloomberg Línea. https://www.bloomberglinea.
Take Over. Bloomberg. https://www.bloomberg.com/ com/2022/08/23/maduro-contrata-a-siemens-pa-
news/articles/2021-09-24/jpmorgan-hired-in-vene- ra-reconstruir-centrales-electricas/
zuela-opposition-s-bid-to-keep-CITGO Zerpa, F. (2022c, August 23). Siemens to Help Rebuild
251
Venezuela’s Electricity Grid. Bloomberg. https://
www.bloomberg.com/news/articles/2022-08-23/
venezuela-hires-siemens-to-help-rebuild-crum-
bling-power-grid
Zerpa, F., & Laya, P. (2023, March 22). Power Struggle
and Missing Billions Roil Venezuelan Ruling Elite.
Bloomberg. https://www.bloomberg.com/news/ar-
ticles/2023-03-22/power-struggle-and-missing-bil-
lions-roil-venezuelan-ruling-elite
Zettelmeyer, J., & Sturzenegger, F. (2006). Debt Defaults
and Lessons from a Decade of Crises. MIT Press.
https://doi.org/10.7551/mitpress/2295.001.0001
252
During the past decade, Venezuela suffered one of the largest economic and
humanitarian crises seen in modern economic history outside of wartime. Yet the
prevalent thinking in the international and policy communities has prioritized the
design of policy solutions to be implemented after a political transition alongside
efforts to generate domestic political change. Regrettably, these efforts have
proved insufficient, ineffective, and at times even counterproductive in helping
overcome the deep deterioration in living conditions suffered by Venezuelans.
Cooperative Responses to Venezuela’s Crisis seeks to think outside the box of the
prevailing conventional wisdom that believes that nothing can be done to help
Venezuelans in the absence of political change. The volume consolidates existing
knowledge and proposals to address Venezuela’s crisis within a framework
of cooperation among the country’s political and non-political stakeholders.
Intended to provide a roadmap for negotiations, it presents a compendium of
proposals made by scholars, policy experts and civil society organizations to
address the deprivations suffered by vulnerable Venezuelans through agreements
between the parties to the country’s political conflict.

Cooperative Responses To Venezuela's Crisis: A Roadmap For Negotiations

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Cooperative Responses To Venezuela's Crisis: A Roadmap For Negotiations

Uploaded by

Copyright:

Available Formats

FRANCISCO RODRÍGUEZ • GIANCARLO BRAVO • GUILLERMO GUERRERO

OIL FOR VENEZUELA, INC. United States, 2023.

ALL RIGHTS RESERVED.

Francisco Rodríguez, Giancarlo Bravo, Guillermo Guerrero.

ISBN 13: 979-8-9892033-6-9.

Cover’s photography: Juan Carlos Hernández.

Chapter 1: The Humanitarian Crisis in Context 23

Chapter 2: International Policy and the Venezuelan Crisis 49

Chapter 3: Oil-for-Essentials Initiatives 79

Chapter 4: Accessing Multilateral Cooperation and Blocked Funds 113

Chapter 5: Asset Protection 157

Chapter 6: Rethinking Policy and Negotiations Design 189

Figure 2. Prevalence of undernourishment, 2000-2020 (% of population) 25

Figure 3. Food Imports, 2012-2020 32

Figure 4. Ratio of total funding to HRP funding requirements, Venezuela 58

Figure 5. Funding by source, Venezuela 59

Figure 6. Venezuela’s oil production (OPEC Secondary Sources, TBD) 82

Figure 7. Iraq’s oil production , 1987-2014(TBD) 88

Figure 8. Iran’s oil production, 2010-2019 (TBD) 89

Figure 9. Syria’s oil production, 2008-2022 (TBD) 90

Figure 10. Libya’s oil production, 2010-2012 (TBD) 90

Figure 11. PDVSA organization chart 164

Figure 12. Public external debt (USD bn) 165

Figure 13. Food- related government program beneficiaries, 2014-2021 195

Figure 14. Receipt of CLAP packages by frequency, 2017-2022 (% of households) 196

Table 1: Summary of proposals by objective 15

Table 3: Largest per capita GDP collapses, constant-price GDP 28

Table 4: Stock of Venezuelan immigrants per country, 2015-2022 52

Table 6: Comparison of OCHA HRP for recent humanitarian crises in 2022 60

Table 7: Summary of cross-country panel data and country-level studies 71

Table 8: Transactions forbidden by Executive Order 13808 80

Table 9: Survey of the estimated impact of sanctions on oil production 85

Table 10: Estimated gains from lifting oil sanctions 87

Table 11: Main characteristics of the program 95

Table 12: Comparison of different Oil-for-Essentials proposals 105

Table 14: Potentially available multilateral financing, conservative estimate. 128

Table 18: Estimated total value of offshore Venezuelan assets. 163

Table 21: CLAP package beneficiaries by political self-identification 199

Table 22: Fatherland Card transfers beneficiaries by political self-identification 199

Table 23: COVID vaccines beneficiaries by political self-identification 199

Table 26: Varieties of initiatives to reduce stakes of power 208

The Roots of the Venezuelan Humanitarian Crisis

Accessing Multilateral Cooperation and Blocked Funds

Rethinking Policy and Negotiations Design

THE HUMANITARIAN CRISIS IN CONTEXT 23

Source. Own elaboration based on BCV.

24 COOPERATIVE RESPONSES TO VENEZUELA’S CRISIS

Sources. Adapted from Rodríguez (2023c).

THE HUMANITARIAN CRISIS IN CONTEXT 25

26 COOPERATIVE RESPONSES TO VENEZUELA’S CRISIS

The Worst Economic Disaster in Peacetime

THE HUMANITARIAN CRISIS IN CONTEXT 27

28 COOPERATIVE RESPONSES TO VENEZUELA’S CRISIS

THE HUMANITARIAN CRISIS IN CONTEXT 29

Sources. Comtrade, adapted from Rodríguez (2023c)

30 COOPERATIVE RESPONSES TO VENEZUELA’S CRISIS

THE HUMANITARIAN CRISIS IN CONTEXT 31

32 COOPERATIVE RESPONSES TO VENEZUELA’S CRISIS

THE HUMANITARIAN CRISIS IN CONTEXT 33

34 COOPERATIVE RESPONSES TO VENEZUELA’S CRISIS

THE HUMANITARIAN CRISIS IN CONTEXT 35

36 COOPERATIVE RESPONSES TO VENEZUELA’S CRISIS

THE HUMANITARIAN CRISIS IN CONTEXT 37