The Politics and History of Venezuela

in Oil

Venezuela, which is located in South America and next to Brazil, Columbia and Guyana, was first inhabited by Carib, Arawak and Chibcha people farming and hunting along the coast, the River of Orinoco as well as the Andean mountain range. On 1522 the first permanent Spanish settlement was established, and this country became a colony of Spain until its independence in 1811 as part of Gran Colombia. This is where it seceded from later.

 

Venezuela was governed by a series of military dictatorships until 1958 when Romulo Betancourt won the first democratic presidential election. The 1970s oil crisis brought windfall profits to Venezuela's oil industry but created further social tensions due to unequal wealth distribution. Unrest grew during the 1980s, when oil prices fell and social programmes were cut, and resulted in an historic agreement between government, business and trades unions.

 

Further economic problems were exacerbated by an International Monetary Fund (IMF) loan and drastic austerity programme that led to riots, a general strike, martial law and many fatalities. Carlos Andres Perez was elected president in 1989 and survived two military coups in 1992, before being ousted and imprisoned seven years later for embezzlement and corruption.

 

In 1998 Hugo Chavez, who lead the first coup against Perez, was elected and introduced a new constitution. Hugo Chavez was re-elected in 2000 for a further six years, on a radical reform mandate covering the land and oil industries known as the Bolivarian revolution after the independence hero Simon Bolivar. Reforms in the oil industry prompted a national strike and management lockout in 2002 which led to a 48 hour military coup. A popular uprising followed and a referendum held in August 2004 returned a victory for Chavez and his reform programme.

 

The last election results returned a clear victory for the Fifth Republic Movement (MVR) headed by Hugo Chavez Frias who received 59% of the vote. The next presidential election is scheduled for 3 December 2006. Other influential political organisations include the Venezuelan Federation of Chambers of Commerce (Federación de Cámaras y Asociaciones de Comercio y Producción de Venezuela) also known as Fedecámaras. This organisation represents the interests of twelve industry sectors: banking, agriculture, commerce, construction, energy, manufacturing, media, mining, ranching, insurance, transportation and tourism.

 

Fedecámaras sets wages and working conditions within these sectors and enforces these through management strikes and lock outs. It was heavily involved in the failed coup attempt in 2002 and its leader, Pedro Carmona, briefly assumed the presidency before seeking sanctuary in Colombia. In 2002 the president appointed a new Board of Directors at Petroleos de Venezuela, the national oil company. This move was deeply unpopular with oil company executives, right wing media interests, the Fedecámaras business group, and opposition trade unions.

 

A national strike and lockout was called which lasted nine weeks. The military leadership sided with the strikers and took the president into military custody. However, Hugo Chavez resumed his presidency when the interim dictatorship collapsed after two days. Amidst a background of growing popular opposition to the forces attempting to depose the president, the Organisation of American States (OAS) brokered a deal with the government and opposition forces to hold a referendum on the continuation of the presidency. Millions signed two petitions demanding that the referendum be held, and finally the interim government agreed.

 

Finally in August 2004 the referendum was called to decide whether Hugo Chavez should continue his presidency or leave office immediately. The result was 58% in support of the president, 42% against. This represented a convincing public endorsement of the reform programme and five months later Hugo Chavez signed a land decree intended to break up large estates and redistribute them to the landless. Support for the reform programme translated into electoral success in 2005, and a boycott of the elections by opposition groups led to a national assembly filled with Chavez supporters.

 

The Confederation of Workers of Venezuela (Confederación de Trabajadores de Venezuela) (CTV) and National Workers' Union of Venezuela (Unión Nacional de Trabajadores de Venezuela) (UNT) are the two main rival trade union federations. Historically, CTV actively fought against military coups and represented a symbol of democracy. However it has become increasingly dominated by members supportive of Democratic Action (AD) and sympathetic to the interests of the oil industry and the media.

 

CTV called the general strike in April 2002 in protest against the president and in collaboration with the lock out organised by Fedecámaras. Subsequently many trade unions broke away from CTV and set up UNT. This new federation supports the reform programme and leadership style of the president.

 

Venezuelan society remains deeply divided on the reform agenda and further non democratic attempts to depose the president are possible. Powerful domestic and foreign interests are deeply opposed to the reform programme and supporters will need to see real results in alleviating poverty and inequality in Venezuela if they are to continue voting for Hugo Chavez and MVR. In the meantime oil revenues are being used to finance domestic social programmes aimed at poverty reduction and foreign policy initiatives.

 

Copyright: Rowena Slope 2006 (Redkite Research)

 

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The Politics and History of Venezuela

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This article was published on 2010/05/11
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