A New Cold War Heats Up in Venezuela

Written by Mary Orsak

Russia and China vetoed a U.S. Security Council draft resolution on February 28 that supported Venezuelan opposition leader Juan Guaido.

The draft resolution also encouraged free and fair elections in a country wracked by a grave humanitarian crisis and allegations of electoral fraud. The United States, in turn, vetoed the Russian proposal which endorsed the incumbent President Nicolas Maduro and denounced foreign interference in Venezuela.

Russian Ambassador Vassily Nebenzia criticized the American resolution as a thinly-veiled attempt for regime change and cited the 2011 Security Council resolution on Libya as evidence that American humanitarian concern often obscures a hidden agenda.

“If the United States were genuinely keen to help the people of Venezuela, then they would operate through official channels, through any of the U.N. accredited agencies in that country,” Nebenzia said before the members of the Security Council. “But that’s not their goal.”

In January 2018, Venezuela’s Constituent Assembly ordered the country’s electoral council to schedule the presidential election for April, which left only 74 days for preparation. The National Electoral Council postponed this election until May, but incumbent Maduro still trounced his chief opposition, Henri Falcon, by 40 percent, according to the official tally.

The Trump administration quickly condemned Venezuela’s electoral process as illegitimate.  Reports surfaced that Maduro exploited his nation’s starvation, which resulted from hyper-inflation of 13,000 percent, by requiring citizens who benefit from the government’s subsidized groceries to present their identity card to polling stations associated with Maduro.

Russian president Vladimir Putin, however, quickly congratulated Maduro on his election in a public statement. China, Cuba, Iran, Syria, and Turkey have also recognized Maduro as the rightful leader of Venezuela.

The question remains why Russia – among other nations – has such a strong interest in Venezuela and, particularly, in Maduro’s regime.

Russia and Venezuela’s close relationship began in 1999 when Hugo Chavez, a socialist with authoritarian tendencies and a hatred for the United States, became president of Venezuela. In 2006, Chavez signed a $2.9 billion deal with Russia for Russian fighter aircrafts after the United States passed an embargo on trading arms with Venezuela. During Chavez’s presidency, Russia has reportedly earned almost $10 billion in arms sales to Venezuela.

Russia not only supplies Venezuela with weapons; the two nations also conduct joint military exercises. Most recently, in December 2018, two Russian bomber planes with nuclear weapon capabilities flew to Venezuela. Venezuela ultimately serves as a new Cuba: a nation from which Russia can intimidate the United States with military threats.

Russia also has an interest in Venezuela’s state-owned oil and gas company, PDVSA. Venezuela has received loans and bailouts from Russia over the past decade, and in return for these cash infusions, Venezuela has provided Russia with significant portions of at least five old fields in the country. Moreover, in 2016, Rosneft, a Russian oil company, loaned PDVSA $1.5 billion, and Venezuela signed over to Russia as collateral 49.9 percent of Citgo, a refining subsidiary in the U.S. owned by PDVSA.

Russia’s financial interests in Venezuela reveal the high stakes of the 2018 presidential election. It remains unclear how far Guaido would stray from Venezuela’s current policy toward Russia, but senior officials in Russia evidently fear that a Guaido presidency would result in a major setback for their country’s interests in Venezuela. Military contracts would likely decrease, and further instability would hinder Venezuela’s ability to repay loans.

The opposition activist Alexei Navalny tweeted that Venezuela’s current instability will cause “12 billion dollars of our money, invested there, [to] be lost.” Conversely, the Russian government has attempted to minimize the potential risk of a Guaido presidency. Vladimir Zayemsky, the Russian ambassador to Venezuela, told the Kommersant newspaper that, “I don’t see any reason to fear for the future of Russia’s investments in Venezuela, first of all because all of the current projects were properly agreed to by all sides and received approval from the legislative bodies of both countries.”

If Russia had no reason to fear a Guaido presidency, however, the country would not expend so much energy and political capital to ensure Maduro’s international recognition. Ultimately, Russia’s economic and political future in South America remains uncertain if Maduro does not remain president, but Russia’s self-interest in conflict with that of the United States and western Europe has – and will continue to – produce destruction in Venezuela, where millions suffer from starvation and 3 million civilians have already fled the country.