Saturday, April 30, 2011

Hugo Chávez, Venezuela and the World

Since 1999, Hugo Chávez is the 56th and current president of Venezuela. He follows a political ideology inspired by Bolivarianism and Socialism (but adapted to the 21 Century). As part of a social project known as “ The Bolivian Revolution,”, Chávez has focused on implementing social reforms that favor the poor people. Additionally, he has enacted a new constitution, has nationalized several key industries, secured government control over oil projects in the Orinoco oil belt and caused Venezuela to withdraw from the International Monetary Fund.

Born from a Venezuelan working class family, Chávez became a career military officer. In 1980, he founded the secretive Revolutionary Movement-200 in order to overthrow the government at the time. According to Chávez, the government was corrupt, undemocratic and only represented the interests of the elites. In 1992, Chávez led an unsuccessful military coup against the president Carlos Andrés Pérez, for which he was imprisoned for two years.

After he was released from prison, he founded the political party named the Fifth Republic Movement, and was elected president of Venezuela in 1998. He enacted a new constitution, which altered the structure of Venezuelan government, and allowed him to be reelected. However, opposition movements started to arise in Venezuela because of the nationalization of various industries and the firing of the management of the state-owned oil company. This policies angered the upper and middle class resulting in an unsuccessful military coup in 2001 and a recall referendum in 2003. Although Chávez was briefly ousted in 2002, he was again elected president in 2003.

Chávez blamed the administration of President George W. Bush for the incident, and his rhetoric became steadily stronger. Chávez openly criticizes capitalism and, in particular, neoliberalism. Additionally, Chávez has been in strong opposition to the United States’ foreign policy. In a speech to the United Nations in September 2006, Chávez, speaking the day after Bush had addressed the General Assembly, declared that the room stank of sulphur because “the devil” had been there. Furthermore, Chávez has had diplomatic problems with other Western nations like Spain, whose bilateral relations were disturbed after the King of Spain publicly told Hugo Chávez to “shut up” when Chávez repeatedly called the former Spanish prime minister a “fascist.”

Chávez within Latin America

He has aligned himself with the socialist governments of Fidel Castro (Cuba), Evo Morales (Bolvia) and Rafael Correa (Ecuador). Chávez is trying to reinforce and expand socialist governments in the region and, by criticizing Western “imperialist policies” he is making himself the hub of anti-American sentiment in Latin America.

In 2009, together with Argentina, Brazil and Bolivia, Chávez incorporated a regional bank to function as a development lender called Bank of the South, based in Caracas, in an attempt to distance Latin American countries from international banks – such as the IMF – and give these countries more financial freedom.

Nonetheless, Chávez has encountered difficulties not only with the United States but also with some Latin American governments. For example, the relationship between Venezuela and Colombia has suffered tremendous damages because of Chavez “secret” support to Colombia’s largest revel group (FARC).

Chávez and China

In April 2010, Chávez said that China had agreed to extend $20 billion in loans to Venezuela. This measure tries to deepen ties between Venezuela, which needs investment in the oil sector, and china, which seeks to secure oil supplies. Furthermore according to the article of the New York Times:

“The announcement of the loans followed other financing agreements with China that softened a sharp economic downturn in Venezuela, including a $12 billion bilateral investment fund. China’s ties with Venezuela have grown increasingly warm in recent years, marked by rising Venezuelan oil exports to China, the Chinese launching of a satellite for Venezuela and the sale of Chinese military aircraft to Venezuela”

If the loans materialize, they could give Mr. Chávez a much-needed cash infusion. Some financial analysts said that Venezuela could soon face a cash crunch as it grapples with low oil revenues and a dearth of foreign investment. Venezuela, faced with a slump in oil production, has recently been seeking to reach similar deals with energy companies from Russia, India and Spain, as well as the Chevron Corporation from the United States”

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