INFORME STRATFOR
Dispatch: Venezuelan Presidental Powers Expand
December 16, 2010
Analyst Reva Bhalla examines Venezuelan President Hugo Chavez’s growing vulnerabilities at home and abroad in light of a new law that will give him expansive executive power.Editor’s Note: Transcripts are generated using speech-recognition technology. Therefore, STRATFOR cannot guarantee their complete accuracy.Venezuelan President Hugo Chavez is pushing through a series of legislation this week all designed to enhance his presidential powers while neutralizing the opposition. This is going to be a rough year for the Venezuelan government and Chavez does not seem to be taking any chances.The current session of Venezuela’s National Assembly was set to expire Dec. 15, but the ruling party is pushing through the end of the week in order to cram in as much legislation as possible before the opposition comes in a dilutes the ruling party’s majority in the coming new year. What all of these laws have in common is they are all intended to enhance the powers of the executive branch while trying to meaningfully neutralize the opposition as much as possible.A really interesting law that came up this past week is and was kind of snuck in at the last minute is an Enabling Law for the president to rule by executive decree for up to one year. The law basically allows Chavez to pass whatever he wants as long as it fits into the very ambiguous categories of national security, defense, land use, transport, the financial sector, the housing sector among others. Evidently, the Venezuelan government is expecting a rough year ahead, and for a good reason.The economic decay in Venezuela is becoming increasingly visible, with ongoing money-laundering rackets, exacerbating its already critical conditions of state sectors across the country. But what is being paid less attention to are the vulnerabilities of the Venezuelan regime abroad, particularly concerning its allies in countries like Cuba, China, Iran and Russia. The Cubans can be seen in pretty much any corridor of Venezuelan power. Critically, they have immense leverage over the Venezuelan security apparatus. What that essentially means is that the Cubans are in charge of notifying the president whenever a coup threat arises (and we’ve already rumblings of this in recent weeks). The Chinese, meanwhile, are pouring billions of dollars of investment into to Venezuelan economy. They’re taking advantage of the Venezuelan government’s vulnerability right now to get extremely favorable terms on a variety of investment deals, most notably in the energy sector. The Iranians have extensive financial links to Venezuela, which allows them to circumvent sanctions. This is an issue that is increasingly attracting the attention of the United States. Critically, there are also signs that the United States is paying more attention to the deepening military linkages between Venezuela and Iran. The Russians maintain a tight defense relationship with the Venezuelans, and they also hold important economic assets in the country. But they know when to keep their distance when they need to.The biggest problem confronting Chavez right now is that each of these allies has varying interests and varying involvement in Venezuela. At a certain point, those interests could collide, because as the Venezuelan government becomes more vulnerable, those allies are going to be demanding much more of Venezuela and could push things too far.This is something we are starting to see develop, particularly with the Venezuelan relationship with Iran. The Venezuelans also have a considerable reason to worry about Cuba, a country that, strapped for cash, is asking Venezuela for sizable loans that it may not even be able to deliver on. When you consider that Cuba has immense leverage over the Venezuelan security apparatus, and when you consider that threats within the regime are rising, the Cuban factor becomes absolutely critical for the president.Chavez may have a lot of friends right now in his time of need; his problem is that the interests of those friends could eventually collide. And in the grand scheme of things, each of these friends could consider Venezuela a dispensable ally.
Analyst Reva Bhalla examines Venezuelan President Hugo Chavez’s growing vulnerabilities at home and abroad in light of a new law that will give him expansive executive power.Editor’s Note: Transcripts are generated using speech-recognition technology. Therefore, STRATFOR cannot guarantee their complete accuracy.Venezuelan President Hugo Chavez is pushing through a series of legislation this week all designed to enhance his presidential powers while neutralizing the opposition. This is going to be a rough year for the Venezuelan government and Chavez does not seem to be taking any chances.The current session of Venezuela’s National Assembly was set to expire Dec. 15, but the ruling party is pushing through the end of the week in order to cram in as much legislation as possible before the opposition comes in a dilutes the ruling party’s majority in the coming new year. What all of these laws have in common is they are all intended to enhance the powers of the executive branch while trying to meaningfully neutralize the opposition as much as possible.A really interesting law that came up this past week is and was kind of snuck in at the last minute is an Enabling Law for the president to rule by executive decree for up to one year. The law basically allows Chavez to pass whatever he wants as long as it fits into the very ambiguous categories of national security, defense, land use, transport, the financial sector, the housing sector among others. Evidently, the Venezuelan government is expecting a rough year ahead, and for a good reason.The economic decay in Venezuela is becoming increasingly visible, with ongoing money-laundering rackets, exacerbating its already critical conditions of state sectors across the country. But what is being paid less attention to are the vulnerabilities of the Venezuelan regime abroad, particularly concerning its allies in countries like Cuba, China, Iran and Russia. The Cubans can be seen in pretty much any corridor of Venezuelan power. Critically, they have immense leverage over the Venezuelan security apparatus. What that essentially means is that the Cubans are in charge of notifying the president whenever a coup threat arises (and we’ve already rumblings of this in recent weeks). The Chinese, meanwhile, are pouring billions of dollars of investment into to Venezuelan economy. They’re taking advantage of the Venezuelan government’s vulnerability right now to get extremely favorable terms on a variety of investment deals, most notably in the energy sector. The Iranians have extensive financial links to Venezuela, which allows them to circumvent sanctions. This is an issue that is increasingly attracting the attention of the United States. Critically, there are also signs that the United States is paying more attention to the deepening military linkages between Venezuela and Iran. The Russians maintain a tight defense relationship with the Venezuelans, and they also hold important economic assets in the country. But they know when to keep their distance when they need to.The biggest problem confronting Chavez right now is that each of these allies has varying interests and varying involvement in Venezuela. At a certain point, those interests could collide, because as the Venezuelan government becomes more vulnerable, those allies are going to be demanding much more of Venezuela and could push things too far.This is something we are starting to see develop, particularly with the Venezuelan relationship with Iran. The Venezuelans also have a considerable reason to worry about Cuba, a country that, strapped for cash, is asking Venezuela for sizable loans that it may not even be able to deliver on. When you consider that Cuba has immense leverage over the Venezuelan security apparatus, and when you consider that threats within the regime are rising, the Cuban factor becomes absolutely critical for the president.Chavez may have a lot of friends right now in his time of need; his problem is that the interests of those friends could eventually collide. And in the grand scheme of things, each of these friends could consider Venezuela a dispensable ally.
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