Crisis in Bolivarian Venezuela
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Protesters confront the People's Guard at Plaza Francia on 18 March 2014. Empty store shelves in a Venezuelan store. Millions of Venezuelans protest in Caracas on 26 October 2016. Venezuelans queued to enter a store. |
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| Date | 2012–ongoing |
|---|---|
| Location | Venezuela |
| Cause | Economic policy, crime, corruption, economic downturn, shortages and political conflict. |
The crisis in Venezuela is the socioeconomic crisis that Venezuela has undergone since Hugo Chávez's tenure and which extended over the years into the current presidency of Nicolás Maduro. It is the worst economic crisis in Venezuela's history. During the year 2016, for example, consumer prices rose 800%, the economy contracted by 18.6%, and hunger escalated to the point that the "Venezuela's Living Conditions Survey" (ENCOVI) found nearly 75 percent of the population had lost an average of at least 8.7 kg (19.4 lb) in weight due to a lack of proper nutrition. The murder rate in 2015 was 90 per 100,000 people according to the Observatory of Venezuelan Violence (compared to 5 per 100,000 in the US).
The crisis has affected the average life of Venezuelans on various levels. The rise of unemployment resulted in the emergence of social movements aimed at both changing the economic and productive model, as well as questioning the political system and demanding a democratic renewal. Political corruption, scarcity of basic products, closure of companies, deterioration of productivity and competitiveness, and high dependence on oil are other problems that have also contributed to the worsening crisis.
With increasing oil prices in the early 2000s and funds not seen in Venezuela since the 1980s, Hugo Chávez created the Bolivarian Missions, aimed at providing public services to improve economic, cultural, and social conditions, with Chávez intending to maintain political power through social programs. According to Corrales and Penfold, "aid was disbursed to some of the poor, and more gravely, in a way that ended up helping the president and his allies and cronies more than anyone else". The Missions entailed the construction of thousands of free medical clinics for the poor, and the enactment of food and housing subsidies. A 2010 OAS report indicated achievements in addressing illiteracy, healthcare and poverty, and economic and social advances. The quality of life for Venezuelans had also improved according to a UN Index. Teresa A. Meade wrote that Chávez's popularity strongly depended "on the lower classes who have benefited from these health initiatives and similar policies."
The social works initiated by Chávez's government relied on oil products, the keystone of the Venezuelan economy, with Chávez's administration suffering from Dutch disease as a result. By the end of Chávez's presidency in the early 2010s, economic actions performed by his government during the preceding decade such as overspending and price controls proved to be unsustainable, with Venezuela's economy faltering while poverty,inflation and shortages in Venezuela increased.
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