External Actors in Venezuela’s Presidential Elections: Who has more at stake?

With less than a month to go until Venezuela’s April 14 special election, international attention has increasingly turned to the election’s likely outcome and implications for Venezuela’s postelection path. Recent polls indicate opposition challenger Henrique Capriles of the Democratic Unity Roundtable (MUD) needs to build considerable support if he is to defeat interim president Nicolás Maduro, of the ruling United Socialist Party of Venezuela (PSUV). Recent polls have given Maduro a comfortable double-digit lead, with a poll conducted by the respected Venezuelan firm Datanalisis giving the former vice president a 14-point margin. Campaigning is legally set to begin April 2, although in practice the campaigns appear well underway.

Yet while Venezuelans are certainly eyeing April 14, a diverse set of countries that benefited from personal relationships with former president Hugo Chávez are likely circling the date on their calendars as well. Within Latin America, Cuba stands to lose the most by a Maduro loss, as it receives nearly 100,000 barrels a day of deeply discounted oil. Members of the Bolivarian Alliance of the Americas (ALBA), including Bolivia, Ecuador, Nicaragua, and several Caribbean nations, are likely watching nervously as well given the leadership role Venezuela played in the organization under Chávez.

Globally, many countries have benefitted from Venezuela’s political and economic largesse. This includes Venezuela’s well-known ties with Iran, Russia, and China, as well as less-publicized support for such autocratic governments as Alexander Lukashenko in Belarus and Bashar al-Assad in Syria. All stand to lose if the opposition emerges victorious on April 14.

Q1: What do these countries stand to lose?

A1: Cuba

Undoubtedly, the Castro bothers and the Cuban government both have a lot riding on the election. Fidel Castro had reportedly long been eyeing Venezuelan oil, especially after the fall of the Soviet Union hit the Cuban economy hard in the early 1990s when the economy contracted 35 percent in three years. In Chávez, Castro saw new support for his government and met with Chávez after he was pardoned for his role in the 1992 coup. Following Chávez’s victory in 1998, the Cuban government had a new lifeline and Venezuela’s cheap oil has limited Cuba’s exposure to high global oil prices. If this arrangement was terminated, Cuba’s economy would likely falter as a result. On top of that, the tens of thousands of Cuban doctors that have been provided for health care programs in Venezuelan barrios might be forced to return home with uncertain employment prospects awaiting them.

China and Russia

The Chinese and Russian governments stand to lose commercial ties as well. For the Chinese government, which has provided lines of credit and development financing to the Venezuelan government in exchange for oil supplies, uncertainty surrounds how previous arrangements would be honored under a Capriles presidency. In fact, China has not extended any lines of credit since April 2012 as a result of the ambiguity surrounding Venezuela’s political transition. Overall, Chinese imports of Venezuelan oil have grown considerably in the last decade; as recently as 2005, China imported just 19,000 barrels per day (bbl/d) from Venezuela; in 2011, that number jumped to 230,000 bbl/d, roughly 10 percent of Venezuelan oil exports. Much of this growth can be attributed to Chávez’s efforts to diversify Venezuelan exports away from the United States, an initiative the Chinese government was happy to oblige.

Meanwhile, the Russian government has benefited from generous arms sales to the Venezuelan government. In 2012, Russia sold a total of roughly $15 billion in arms exports, with 80 percent of the sales belonging to the state-owned Rosoboronexport. Precise sales to the Venezuelan government can be difficult to come by. In 2010, then-prime minister Vladimir Putin stated that sales to Venezuela could total $5 billion, including a $2.2 billion loan for arms purchases extended to the Venezuelan government in 2009. At the time, sales had totaled $4 billion since 2005. And the sale of 1,800 antiaircraft missiles to Venezuela in 2009 raised eyebrows among the U.S. government. An opposition victory might cool this business relationship and see Venezuela turn to other arms suppliers, such as the United States and European countries.

Iran

Iran’s outreach into Latin America over the past decade would likely be jeopardized with an opposition victory. Unlike other relationships, Iran gains little economically from its ties with Venezuela. Although the Venezuelan and Iranian governments have announced many joint venture projects in areas such as oil and gas production, few appear to have materialized and the lack of transparency over these ventures has made it difficult to determine their economic value, if any. Instead, the Iranian government has used its warm relations with Venezuela to build relations with friendly governments throughout Latin America in an attempt to gain international legitimacy, particularly for its nascent nuclear program. An opposition victory would likely end the cozy relations and Iran would be without one of its biggest supporters in the Americas.

Syria and Belarus

Finally, several other nations stand to lose diplomatic support if the PSUV fails to retain Miraflores. Embattled Syrian president Bashar al-Assad has already lost one of his few vocal supporters with Chávez’s passing. Although the Syrian government received little in material support from Venezuela— most notably, Venezuela provided several shipments of diesel fuel in return for naphtha—al-Assad would likely find himself increasingly isolated with an opposition victory in Venezuela. Belarus, where President Alexander Lukashenko has headed the government since 1994, has lost one of its few international friends as well. Lukashenko, repeatedly criticized for clampdowns on domestic opposition parties and banned from traveling to the United States or European Union, had friendly relations with the Venezuelan government under Chávez, although economic ties were limited.

Q2: Why are these relationships important and how might these relationships affect post-election Venezuela?

A2: A Maduro victory would likely see continuity of policies started under Chávez. However, if Maduro begins to make difficult choices to correct imbalances in the Venezuelan economy, he may find curtailing generous oil shipments a necessity in order to increase funds for the Venezuelan government. Geopolitical relationships of little value to Venezuela, other than to wear as an anti-United States badge, are more likely to be reduced although this remains uncertain.

A Capriles presidency would likely see a dramatic reordering of foreign relations in Venezuela. At a recent speech, Capriles vowed to end oil aid to Cuba, stating that “the giveaways to other countries are going to end” and then singled out the Castro-led Cuban government. Capriles then promised to use these funds to boost public sector salaries by 40 percent to compensate for the high inflation rate that has plagued Venezuela under the Chávez government. This likely implies an end to Venezuelan largesse to other governments under Capriles.

As Capriles seeks to end some of the economic distortions that have been brought about by the government mismanagement, he may maintain ties that provide Venezuela with benefits—namely, Chinese loans—but it appears that most relationships Chávez cultivated would be quickly undone. As can be expected, these governments will be watching closely as Venezuelans head to the polls to elect their next president.

Carl Meacham is the director of the Americas Program at the Center for Strategic and International Studies (CSIS) in Washington, D.C. Michael Graybeal, program coordinator with the Americas Program at CSIS, provided research assistance.

Critical Questions is produced by the Center for Strategic and International Studies (CSIS), a private, tax-exempt institution focusing on international public policy issues. Its research is nonpartisan and nonproprietary. CSIS does not take specific policy positions. Accordingly, all views, positions, and conclusions expressed in this publication should be understood to be solely those of the author(s).

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Carl Meacham