# Venezuela: Issues for Congress, 2009-2012

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URL: https://www.frixlaw.com/law-library/documents/crs%3AR40938

## Record

- **Collection:** Congressional research report
- **Document type:** CRS Report
- **Published:** January 10, 2013
- **Citation:** R40938

## Text

Venezuela: Issues for Congress, 2009-2012
-name redactedSpecialist in Latin American Affairs
January 10, 2013

Congressional Research Service
7-....
www.crs.gov
R40938

Venezuela: Issues for Congress, 2009-2012

Summary
Under the rule of populist President Hugo Chávez, first elected in 1998, Venezuela has undergone
enormous political changes, with a new constitution and unicameral legislature, and even a new
name for the country, the Bolivarian Republic of Venezuela. Human rights organizations have
expressed concerns about the deterioration of democratic institutions and threats to freedom of
expression under the Chávez government. President Chávez won reelection to another six-year
term on October 7, 2012, by a margin of 11%, capturing about 55% of the vote compared to 44%
for opposition candidate Henrique Capriles. On December 11, 2012, however, Chávez faced a
fourth difficult operation in Cuba for an undisclosed form of cancer that has raised questions
about Venezuela’s political future. Because of significant health complications, Vice President
Nicolás Maduro announced on January 8, 2013, that President Chávez would not be sworn into
office on January 10 as planned, but that he would be sworn into office at a later date, a decision
supported by Venezuela’s Supreme Court. Looking ahead, if President Chávez does not recover,
the Constitution calls for a new election to be held within 30 days if the president dies or is
incapacitated during the first four years of his term.
U.S. Policy
The United States traditionally has had close relations with Venezuela, a major supplier of foreign
oil, but there has been friction in relations under the Chávez government. Over the years, U.S.
officials have expressed concerns about human rights, Venezuela’s military arms purchases, its
relations with Iran, and its efforts to export its brand of populism to other Latin American
countries. Declining cooperation on anti-drug and anti-terrorism efforts has been a major concern.
The United States has imposed sanctions: on several Venezuelan government and military
officials for allegedly helping the Revolutionary Armed Forces of Colombia (FARC) with drug
and weapons trafficking; on three Venezuelan companies for providing support to Iran; and on
several Venezuelan individuals for providing support to Hezbollah. Despite tensions in relations,
the Obama Administration remains committed to seeking constructive engagement with
Venezuela, focusing on such areas as anti-drug and counter-terrorism efforts. In the aftermath of
President Chávez’s reelection, the White House, while acknowledging differences with President
Chávez, congratulated the Venezuelan people on the high level of participation and the relatively
peaceful election process.
Legislative Initiatives
As in past years, there were concerns in the 112th Congress regarding the state of Venezuela’s
democracy and human rights situation and its deepening relations with Iran, and these concerns
will likely continue in the 113th Congress. The 112th Congress approved H.R. 3783 (P.L. 112220), which requires the Administration to conduct an assessment and present “a strategy to
address Iran’s growing hostile presence and activity in the Western Hemisphere.” Other initiatives
that were not approved include: H.R. 2542, which would have withheld some assistance to the
Organization of American States unless that body took action to invoke the Inter-American
Democratic Charter regarding the status of democracy in Venezuela; H.R. 2583, which included a
provision prohibiting aid to the government of Venezuela; and H.Res. 247, which would have
called on the Secretary of State to designate Venezuela as a state sponsor of terrorism.
In action on FY2013 foreign aid appropriations, the report to the House Appropriations
Committee bill, H.R. 5857 (H.Rept. 112-494, reported May 25, 2012), directs that $5 million in

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Venezuela: Issues for Congress, 2009-2012

Economic Support Funds be provided for democracy programs in Venezuela, the same amount
appropriated in FY2012, and $2 million more than requested by the Administration. In contrast,
the report to the Senate Appropriations Committee bill, S. 3241 (S.Rept. 112-172, reported May
24, 2012), recommends $3 million for democracy programs in Venezuela to be administered by
the National Endowment for Democracy. Ultimately, the 112th Congress did not complete action
on a FY2013 full-year foreign operations appropriations measure, but it did approve a Continuing
Appropriations Resolution, FY2013 (P.L. 112-175) in September 2012, which funds regular
foreign aid accounts at the same level as in FY2012, plus 0.612% through March 27, 2013.
Specific country accounts, however, are left to the discretion of responsible agencies. The 113th
Congress will need to address foreign aid appropriations for the balance of FY2013.
Note: This report provides background on political and economic changes in Venezuela, U.S.
policy, and U.S. legislative action and initiatives from 2009-2012 covering the 111th and 112th
Congress. It will not be updated.

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Contents
Recent Developments ...................................................................................................................... 1
Political Situation............................................................................................................................. 3
Background: Chávez’s Rise to Power and Rule from 1998-2008 ............................................. 3
Political Developments: 2009-2013 .......................................................................................... 6
February 15, 2009, Term Limits Referendum ..................................................................... 6
September 2010 Legislative Elections ................................................................................ 7
December 2010 Actions by Outgoing National Assembly .................................................. 8
October 2012 Presidential Election ..................................................................................... 8
December 2012 State Elections......................................................................................... 12
Chávez’s Health Status and Political Implications ............................................................ 12
Economic Conditions..................................................................................................................... 16
U.S. Policy ..................................................................................................................................... 20
Bilateral Relations during the George W. Bush Administration .............................................. 20
Obama Administration Policy ................................................................................................. 21
U.S. Foreign Aid to Venezuela ................................................................................................ 25
Human Rights Concerns .......................................................................................................... 27
Threats to Freedom of Expression..................................................................................... 30
Anti-Semitism ................................................................................................................... 32
Energy Issues ........................................................................................................................... 33
Counternarcotics Issues ........................................................................................................... 35
State Department 2012 INCSR Report ............................................................................. 37
September 2012 Presidential Determination ..................................................................... 37
Venezuela’s Views of Its Anti-Drug Efforts ...................................................................... 38
Extradition of Walid Makled from Colombia.................................................................... 38
Venezuela’s Military Purchases ............................................................................................... 39
Venezuela’s Activities in Latin America .................................................................................. 41
Terrorism Issues....................................................................................................................... 43
Colombian Terrorist Groups .............................................................................................. 43
Deepening Relations with Iran .......................................................................................... 44
Legislative Initiatives in the 112th Congress .................................................................................. 49
Legislative Initiatives in the 111th Congress .................................................................................. 50
Enacted and Considered Measures .......................................................................................... 50
Other Introduced Measures ..................................................................................................... 51

Figures
Figure 1. Map of Venezuela ............................................................................................................. 2
Figure 2. Venezuela: GDP Growth (%), 2005-2012 ...................................................................... 17
Figure 3. Venezuela: Consumer Inflation (average %), 2005-2012 ............................................... 18

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Tables
Table 1. Venezuela’s Constitutional Provisions: Presidential Oath and Absences
(Absolute and Temporary) .......................................................................................................... 15
Table 2. Venezuela’s Trade Balance, 2004-2011 ........................................................................... 19
Table 3. U.S. Foreign Aid to Venezuela by Account, FY2008-FY2013 ........................................ 26

Appendixes
Appendix A. Links to U.S. Government Reports .......................................................................... 53
Appendix B. Earlier Key Developments in 2009-2012 ................................................................. 55

Contacts
Author Contact Information........................................................................................................... 60

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Recent Developments
On January 8, 2013, Vice President Nicolás Maduro announced that President Chávez would not
be sworn into office on January 10 as planned because he was still recovering from cancer
surgery in Cuba, but that he would be sworn into office at a later date, as provided for in Article
231 of the Constitution. A day later, on January 9, 2013, Venezuela’s Supreme Court upheld this
interpretation of the Constitution, maintaining that Chávez could take the oath of office before the
Supreme Court at a later date when his health improves. Some opposition leaders and some
Venezuelan legal scholars had argued that the January 10 inauguration date was fixed by Article
231, and that since Chávez could not be sworn in on that date, then the President of the National
Assembly should have been sworn in as interim or caretaker President until either a new election
was held or Chávez recovered. Opposition leader Henrique Capriles appeared to accept the
Supreme Court’s interpretation of the Constitution, but maintained that it did not end the
uncertainties facing the country. (See “Chávez’s Health Status and Political Implications” below.)
On December 16, 2012, Venezuela held state elections in which 23 governorships were at stake.
Voters delivered a resounding victory to President Chávez and his United Socialist Party of
Venezuela (PSUV), which won 20 out of 23 states. Opposition candidates won just three states,
including the state of Miranda, where recently defeated opposition presidential candidate
Henrique Capriles Radonski was reelected. (See “December 2012 State Elections”)
On December 8, 2012, President Chávez announced that his cancer had returned and that he
would soon undergo a fourth cancer surgery in Cuba. He also announced his support for Vice
President Nicolás Maduro if anything were to happen to him, including support for Maduro in a
new election that would be required by the Constitution. (Maduro had been sworn into office on
October 13, 2012, and retained his position as foreign minister, which he has held since 2006.)
Chávez reportedly faced complications during and after his December 11 surgery, and faced new
respiratory complications at year’s end. (See “Chávez’s Health Status and Political Implications”
below.)
On October 7, 2012, President Chávez won reelection to another six-year term by a margin of
11%, capturing about 55% of the vote compared to 44% for opposition candidate Henrique
Capriles. Most reports indicate that election day was peaceful with only minor irregularities. A
White House spokesman, while acknowledging differences with President Chávez, congratulated
“the Venezuelan people on the high level of participation, as well as on what was a relatively
peaceful process.” (For more details, see “Election Results and Implications” below.)
On September 18, 2012, Venezuelan security forces captured a major Colombian drug trafficker,
Daniel Barrera, who reportedly was based in Venezuela since 2008. (See “Counternarcotics
Issues” below.)
For developments earlier in 2009-2012, see Appendix B at the end of this report.

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Venezuela: Issues for Congress, 2009-2012

Figure 1. Map of Venezuela

Source: Map Resources. Adapted by CRS.

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Political Situation
For more than a decade, Venezuela has experienced significant political changes under the rule of
populist President Hugo Chávez, and for a number of years there has been concern about the
deterioration of democratic institutions and threats to freedom of expression in the country.

Background: Chávez’s Rise to Power and Rule from 1998-2008
With his election as president in December 1998, Hugo Chávez began to transform Venezuela’s
political system. The watershed election, in which former coup leader Chávez received 56% of
the vote (16% more than his closest rival), illustrated Venezuelans’ rejection of the country’s two
traditional parties, Democratic Action (AD) and the Social Christian party (COPEI), which had
dominated Venezuelan politics for much of the past 40 years. Elected to a five-year term, Chávez
was the candidate of the Patriotic Pole, a left-leaning coalition of 15 parties, with Chávez’s own
Fifth Republic Movement (MVR) the main party in the coalition.
Most observers attribute Chávez’s rise to
power to Venezuelans’ disillusionment with
politicians whom they judge to have
squandered the country’s oil wealth through
poor management and endemic corruption. A
central theme of his campaign was
constitutional reform; Chávez asserted that the
system in place allowed a small elite class to
dominate Congress and that revenues from the
state-run oil company, Petroleos de Venezuela
S.A. (PdVSA), had been wasted.

Chávez Biography
Hugo Chávez Frias was born on July 28, 1954, in a small
farming town in the western Venezuelan state of Barinas.
The son of school teachers, Chávez was a 1975 graduate
of Venezuela’s Military Academy. He reached the rank of
lieutenant colonel by 1990. In February 1992, Chávez led
an unsuccessful attempt to overthrow the elected
government of President Carlos Andrés Pérez. He was
imprisoned for two years for the coup attempt before
being pardoned. While in the military, Chávez founded
the nationalistic and left-leaning Bolivarian Revolutionary
Movement, which was later transformed into the Fifth
Republic Movement in the 1998 elections when Chávez
was first elected president.

Although Venezuela had one of the most
Source: Current Leaders of Nations, Gale Group. May
stable political systems in Latin America from
20, 2004.
1958 until 1989, after that period numerous
economic and political challenges plagued the country and the power of the two traditional parties
began to erode. Former President Carlos Andres Perez, inaugurated to a five-year term in
February 1989, initiated an austerity program that fueled riots and street violence in which several
hundred people were killed. In 1992, two attempted military coups threatened the Perez
presidency, one led by Chávez himself, who at the time was a lieutenant colonel railing against
corruption and poverty. Ultimately the legislature dismissed President Perez from office in May
1993 on charges of misusing public funds, although some observers assert that the president’s
unpopular economic reform program was the real reason for his ouster.1 The election of elder
statesman and former President Rafael Caldera as president in December 1993 brought a measure
of political stability to the country, but the Caldera government soon faced a severe banking crisis
that cost the government more than $10 billion. While the macro-economy began to improve in
1997, a rapid decline in the price of oil brought about a deep recession beginning in 1998.

1

For example, see M. Delal Baer, “Revenge of the Venezuelan Dinosaurs,” Wall Street Journal, June 18, 1993.

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Venezuela: Issues for Congress, 2009-2012

In the first several years of President Chávez’s rule, Venezuela underwent enormous political
changes and even received a new name for the country, the Bolivarian Republic of Venezuela,
named after the 19th century South American liberator Simon Bolivar, whom Chávez often
invokes. In 1999, Venezuelans went to the polls on three occasions—to establish a constituent
assembly that would draft a new constitution, to elect the membership of the 165-member
constituent assembly, and to approve the new constitution—and each time delivered victory to
President Chávez. The new document revamped political institutions, including the elimination of
the Senate and establishment of a unicameral National Assembly, and expanded the presidential
term of office from five to six years, with the possibility of immediate reelection for a second
term. Under the new constitution, voters once again went to the polls in July 2000 for a so-called
mega-election, in which the president, national legislators, and state and municipal officials were
selected. President Chávez easily won election to a new six-year term, capturing about 60% of the
vote while his opponent, fellow former coup leader Francisco Arias, received 38%. Chávez’s
Patriotic Pole coalition also captured 14 of 23 governorships and a majority of seats in the
National Assembly.
Although President Chávez remained widely popular until mid-2001, his standing eroded after
that, amid concerns that he was imposing a leftist agenda on the country and that his government
was ineffective in improving living conditions in Venezuela. In April 2002, massive opposition
protests and pressure by the military led to the ouster of Chávez from power for less than three
days. He ultimately was restored to power by the military, however, after an interim president
alienated the military and public by taking hardline measures, including the suspension of the
constitution. In the aftermath of Chávez’s brief ouster from power, the political opposition
continued to press for his removal from office, first through a general strike that resulted in an
economic downturn in 2002 and 2003, and then through a recall referendum that ultimately was
held in August 2004 and which Chávez won by a substantial margin. In 2004, the Chávez
government moved to purge and pack the Supreme Court with its own supporters in a move that
dealt a blow to judicial independence. The political opposition boycotted legislative elections in
December 2005, which led to domination of the National Assembly by Chávez supporters.
The rise in world oil prices beginning in 2004 fueled the rebound of the economy and helped
support an array of social programs and services known as “missions” that helped reduce poverty
by some 20% by 2007.2 In large part because of the economic rebound and attention to social
programs, Chávez was reelected to another six-year term in December 2006 in a landslide, with
almost 63% of the vote compared to almost 37% for opposition candidate Manuel Rosales.3
After he was reelected, however, even many Chávez supporters became concerned that the
government was becoming too radicalized. Chávez’s May 2007 closure of a popular Venezuelan
television station that was critical of the government, Radio Caracas Television (RCTV), sparked
significant protests and worldwide condemnation. Chávez also proposed a far-reaching
constitutional amendment package that would have moved Venezuela toward a new model of
development known as “socialism in the 21st century,” but this was defeated by a close margin in
a December 2007 national referendum. University students took the lead in demonstrations
against the closure of RCTV, and also played a major role in defeating the constitutional reform.
2

U.N. Economic Commission for Latin America and the Caribbean, Social Panorama of Latin America, 2008, Briefing
Paper, November 2008, p. 11.
3
See the officials resulted reported by Venezuela’s National Electoral Commission at
http://www.cne.gob.ve/divulgacionPresidencial/resultado_nacional.php.

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In 2008, President Chávez moved to unite his supporters into a single party—the United Socialist
Party of Venezuela (PSUV)—although several parties that had supported Chávez in the past
declined to join. The Venezuelan government also continued to move forward with
nationalizations in key industries, including food companies, cement companies, and the
country’s largest steel maker; these followed the previous nationalization of electricity companies
and the country’s largest telecommunications company and the conversion of operating
agreements and strategic associations with foreign companies in the oil sector to majority
Venezuelan government control.
State and local elections held in November 2008 revealed a mixed picture of support for the
government and the opposition. Pro-Chávez candidates won 17 of the 22 governors’ races, while
the opposition won governorships in three of the country’s most populous states, Zulia, Miranda,
and Carabobo, as well as the states of Nueva Esparta and Táchira (see Figure 1 for a map of
Venezuela). At the municipal level, pro-Chávez candidates won over 80% of the more than 300
mayoral races, while the opposition won the balance. Among the opposition’s mayoral successes
were races for the metropolitan mayor of Caracas, four out of the five smaller municipalities that
make up Caracas (including the poor municipality of Sucre), and the country’s second-largest
city, Maracaibo.4
Leading up to the November elections, President Chávez’s PSUV held primary elections around
the country on June 1, 2008, to select candidates, although the process was criticized for a lack of
transparency. The opposition initially had difficulty in agreeing on a single slate of candidates so
as not to split the opposition vote, but by the end of September 2008 had agreed on a unified
candidate for most governor races.5 The opposition includes newer parties such as Primero
Justicia (PJ, Justice First), Proyecto Venezuela (Project Venezuela), and Un Nuevo Tempo (UNT,
A New Era); leftist parties that defected from the Chavista coalition such as the Movimiento al
Socialismo (MAS, Movement toward Socialism) and Por la Democracia, Social (Podemos, For
Social Democracy); and the traditional political parties from the past such as AD and COPEI.6
One of the major problems for the opposition was that the Venezuelan government’s comptroller
general disqualified 272 individuals (down from almost 400 originally disqualified) from running
for office, purportedly for cases involving the misuse of government funds.7 There were several
challenges to Venezuela’s Supreme Court that the comptroller general’s action violated the
Constitution, but on August 5, 2008, Venezuela’s Supreme Court upheld the disqualifications. The
Venezuelan government maintained that the majority of those disqualified were from the ranks of
its own supporters,8 while the opposition maintained that a large percentage were from the
opposition, including several high-profile opposition candidates.9 Among those excluded was
Leopoldo López, the popular mayor of Chacao, who was seeking to run for mayor of Caracas.
4

“Both Sides Celebrate in Venezuela,” LatinNews Daily, November 25, 2008; “La oposición venezolana se atribuye un
“triunfo indiscutible” electoral,” Agencia EFE, November 26, 2008; Tyler Bridges, “Chávez Allies Score Big Wins in
Venezuela Elections,” Miami Herald, November 24, 2008; Simon Romero, “Venezuelan Opposition Gains in Several
Crucial Elections,” New York Times, November 24, 2008.
5
Ibid.
6
“Venezuela: Opposition Disarray Hurts Electoral Hopes,” Oxford Analytica, July 1, 2008.
7
“Inhabilitaciones a Políticos en Venezuela Se Reducen de 400 a 272,” Agence France-Presse, July 11, 2008.
8
Embassy of the Bolivarian Republic of Venezuela to the United States, “Fact Sheet, Myths and Realities of the
Disqualifications from Holding Public Office,” July 17, 2008.
9
Inter-American Commission on Human Rights, Annual Report, 2008.

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Political Developments: 2009-2013
February 15, 2009, Term Limits Referendum
In the aftermath of the state and municipal elections in November 2008, President Chávez
announced that he would move ahead with plans to seek changes to the constitution that would
lift the two-term limit for the office of the presidency. This would allow him to run for reelection
in 2012 and beyond. The National Assembly voted on January 14, 2009, to hold a referendum on
the constitutional amendment, expanding it further so that the abolition of term limits would
apply to all elected government officials. As a result, the proposed amendment pertained to the
president, all state and municipal officials, and deputies to the National Assembly. The
referendum was scheduled for February 15, 2009, and various polls indicated that the vote would
be close. Ultimately, with a participation rate of 70%, Venezuelans approved the constitutional
reform with almost 55% voting for it and 45% voting against it.10 President Chávez proclaimed
that the vote was a victory for the Bolivarian Revolution, and virtually promised that he would
run for reelection in 2012.11
The amendment was controversial given the defeat of the government’s constitutional reform
package in December 2007, which had included an amendment that would have removed the
presidential two-term limit. Venezuela’s opposition maintained that President Chávez’s effort to
amend the constitution in 2009 was illegal because the constitution (Article 345) prohibits a
constitutional reform that was rejected from being presented again to the National Assembly in
the same constitutional period. According to this view, since the next National Assembly would
not be elected until late 2010 and take office until early 2011, such an amendment should not
have been considered until then.
Similar to the campaign against the government’s December 2007 constitutional reform package,
student groups played a leading role in the opposition to the abolishment of term limits in 2009.
During the referendum campaign, Venezuelan security forces used tear gas, plastic bullets, and
water cannons to disperse several student protests nationwide, although a massive student
demonstration was allowed to take place in Caracas. Opposition parties again united against the
referendum, including the democratic socialist Podemos party that had once supported President
Chávez.
During the campaign, President Chávez argued that the constitutional change would only allow
him to run again, but would not mean that he would be reelected or remain in power indefinitely.
He maintained that he does not want to be “president for life,” but would like to remain in power
until 2019 in order to ensure that his revolutionary project continues.12 Chávez campaigned
vigorously for the amendment, and spent hours on state-run television in support of it. The
president’s support among many poor Venezuelans, who have benefited from increased social
spending and programs, was an important factor in the vote.

10
See the results on the website of the National Electoral Council (CNE), available at http://www.cne.gov.ve/
divulgacion_referendo_enmienda_2009/.
11
Juan Forero, “Chávez Wins Removal of Term Limits,” Washington Post, February 16, 2009.
12
“Venezuela Poll Deadlocked,” LatinNews Daily, January 29, 2009.

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One likely reason that President Chávez moved quickly with the referendum was the economic
problems facing Venezuela due to the global financial crisis and the fall in the price of oil. With
declining government revenue, his government faced the possibility of losing support if the
economic situation deteriorated further, especially if the government was forced to cut back on
domestic spending. Such a scenario could have made it more difficult for an amendment on term
limits to be approved. Moreover, the National Assembly at the time almost completely dominated
by Chávez supporters because the opposition boycotted the 2005 legislative elections. Assuming
that the opposition would participate in the next legislative elections in 2010, the next National
Assembly would likely include an invigorated opposition that could have made it more difficult
for the government to advance a constitutional amendment to abolish term limits.

September 2010 Legislative Elections
In Venezuela’s September 26, 2010, elections for the 165-member National Assembly, proChávez supporters won 98 seats while opposition parties won 67 seats. For the government,
President Chávez’s United Socialist Party of Venezuela (PSUV) won 94 seats, while other
government supporters included one seat for the Communist Party of Venezuela (PCV) and three
indigenous representatives. For the opposition, 10 parties of the opposition coalition known as the
Democratic Unity Platform (MUD) won 65 seats, while the leftist Homeland for All (PPT) won 2
seats.13 Nationwide participation in the elections was high, with 66.45% participation (compared
to almost 75% participation in the 2006 presidential race).14
Even though the ruling party won a majority of seats, the result was viewed as a significant defeat
for President Chávez because it denied his government the three-fifths majority (99 seats) needed
to enact enabling laws that grant the president decree powers. It also denied the government the
two-thirds majority (110 seats) needed for a variety of actions to ensure the enactment of the
government’s agenda, such as introducing or amending organic laws, approving constitutional
reforms, and making certain government appointments. The combined opposition (MUD and
PPT) also narrowly won the popular vote, capturing 51% of the vote compared to 49% for the
ruling PSUV and its ally, the PCV. Nevertheless, the government was able to maintain a majority
of seats because rural districts (where the government has strong support) elect a disproportionate
number of legislators.15
In the lead-up to the elections, many observers had expected that the President Chávez’s PSUV
would retain a majority, but that the opposition coalition would gain substantial representation.
The ruling party benefitted from the government’s decision last year to redraw electoral districts.
The PSUV also benefitted from significant resources, a nation-wide organization and electoral
machine, and effective use of social network websites. The PSUV’s campaign was dubbed
Operation Demolition in light of President Chávez’s call “to demolish the opposition.” Despite
the PSUV’s advantages, the legislative elections were held at a difficult time for the Chávez
government and the opposition benefited from this. President Chávez’s popularity had declined to
less than 40% and there were considerable public concerns about the difficult economic situation
and high rate of violent crime facing the country.
13

“Venezuela Country Report,” Economist Intelligence Unit (EIU) November 2010.
“Poder Electoral Emitió Primer Boletín Oficial de Elecciones Parlamentarias,” Consejo Nacional Electoral,
September 27, 2010.
15
“Venezuela Country Report,” EIU, November 2010.
14

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The Venezuelan government did not allow observers from the Organization of American States
(OAS), the Carter Center, or other international groups with election monitoring experience,
although it did permit each electoral coalition to invite 30 witnesses from abroad for the elections.
Four domestic Venezuelan nongovernmental organizations, however, were involved in
monitoring the elections, with a total of almost 2,500 observers. Election-day voting appeared to
have been conducted peacefully with isolated minor problems.

December 2010 Actions by Outgoing National Assembly
In December 2010, Venezuela’s outgoing National Assembly approved several laws that were
criticized by human rights organizations and others as threats to free speech, civil society, and
democratic governance. The laws were approved ahead of the inauguration of Venezuela’s new
National Assembly in early January 2011, in which opposition deputies have enough
representation to deny the government the two-thirds and three-fifths needed for certain actions.
Most significantly, the outgoing Assembly approved an “enabling law” that provided President
Chávez with far-reaching decree powers for 18 months. In February 2011, then-Assistant
Secretary of State for Western Hemisphere Affairs Arturo Valenzuela described the Assembly’s
action as “undermining the authority of the new assembly and thereby circumscribing popular
will.”16 The Washington Office on Latin America (WOLA) also maintained that the law
“constitutes an illegitimate infringement on the new National Assembly’s authority, subverting
the will of the electorate.”17 Until its expiration in June 2012, the enabling law was used by
President Chávez more than 50 times, including decrees to change labor laws and the criminal
code, along with a nationalization of the gold industry.18
Other measures approved by the Assembly included changes to broadcast media laws that,
according to Human Rights Watch, introduce sweeping restrictions on Internet traffic, reinforce
existing restrictions on radio and television content, and allow the government to terminate
broadcasting licenses on arbitrary grounds.19
Another measure, the Law of the Defense of Political Sovereignty and National SelfDetermination, imposes restrictions on Venezuelan human rights groups from receiving
international support (also see “Human Rights Concerns” below). The law could have
ramifications for U.S. government and other donors’ assistance to Venezuelan civil society
groups, and potentially could constrain the ability of nongovernmental organizations to operate.

October 2012 Presidential Election
With a record turnout of 80.7% of voters, President Chávez won reelection to another six-year
term in the October 7, 2012 presidential election, capturing about 55% of the vote, compared to
16
U.S. Department of State, Testimony of Arturo Valenzuela, Assistant Secretary of State for Western Hemisphere
Affairs, before the House Foreign Affairs Committee, Subcommittee on the Western Hemisphere, February 15, 2011,
available at http://www.state.gov/p/wha/rls/rm/2011/156598.htm.
17
“Severe Setbacks to Democratic Governance and Human Rights Guarantees in Venezuela,” Washington Office on
Latin America, January 19, 2011.
18
Ezequiel Minaya, “Chávez’s Decree Powers Expire, but Not Before Heavy Use,” Dow Jones Newswires, June 18,
2012.
19
“Venezuela: Legislative Assault on Free Speech, Civil Society,” Human Rights Watch, December 22, 2011.

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44% for opposition candidate Henrique Capriles, according to Venezuela’s National Electoral
Council (CNE). The presidential inauguration is scheduled to take place on January 10, 2013.20
(For more details, see “Election Results and Implications” below.)

Background on the Election
Venezuelans approved a constitutional referendum in 2009 abolishing the term limits for elected
officials, so President Chávez was once again a candidate for reelection. As described above, he
was first elected in 1998, then in 2000 (under a new Constitution), and again in 2006 to a six-year
term. Venezuela’s 2006 presidential election was characterized as free and fair by international
observers with some irregularities, while 2010 national legislative elections were also
characterized as free and fair by domestic observers with scattered irregularities, although there
was criticism of the electoral law and the government’s partisan use of state resources.
Venezuela’s opposition held a unified primary on February 12, 2012, under the banner of the
Mesa de la Unidad Democrática (MUD, Democratic Unity Roundtable) and chose Henrique
Capriles Radonski in a landslide with about 62% of the vote in a five-candidate race (the next
closest candidate, Pablo Pérez, governor of Zulia, captured about 30% of the vote). A member of
the Primero Justicia (PJ, Justice First) party, Capriles is the governor of Miranda, Venezuela’s
second-most populous state, which includes several municipalities of metropolitan Caracas. Just
over 2.9 million Venezuelans voted in the primary—while this only represented about 16% of the
18 million Venezuelans registered to vote, primary organizers had expected far less. During the
primary election, Capriles had a message of reconciliation and national unity. He pledged not to
dismantle Chávez’s social programs, but rather to improve them. Capriles—who turned 40 in July
2012 – also represents a new generation of Venezuelan politicians not belonging to the older
traditional parties that have been largely discredited.21
It was thought that the wide margin of the primary victory for Capriles would give him a boost in
the general election race, but for much of the campaign he remained the underdog. President
Chávez continued to retain high favorability ratings, and led opinion polls for much of the race,
with a lead between 5% and 30%.22 Just weeks before the election, however, while Chávez still
was favored by most polls, ranging from a 2% lead to a 20% lead, at least one poll showed
Capriles winning by about 3%.23 Many observers contended that while Chávez remained favored
to win by most polls, Capriles potentially might have pulled off an upset victory. Observers
focused on two key factors in the race—how undecided or independent voters would vote and to
what extent each side would be able to mobilize their supporters. Capriles ran an energetic
campaign traveling throughout the country with multiple campaign rallies each day, while the
Chávez campaign reportedly was somewhat disorganized and limited in terms of campaign rallies
because of Chávez’s health.

20
Venezuela traditionally has held its presidential election in December, but in September 2011, the CNE, dominated
by Chávez supporters, moved up the date of the presidential election to October 2012.
21
Michael Shifter, “Henrique Capriles’ Moment,” El Colombiano, February 15, 2012.
22
“Venezuela Country Report,” Economist Intelligence Unit, August 2012; “Table—Chávez Leads Polls Ahead of
Venezuelan Election,” Reuters News, August 23, 2012.
23
“Table—Latest Opinion Polls in Venezuela Election Race,” Reuters News, September 27, 2012; José de Córdoba and
Kejal Vyas, “Henrique Capriles Representa la Primera Gran Amenaza Para Chávez,” Wall Street Journal Americas,
October 2, 2012.

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Nevertheless, Chávez had several distinct advantages in the presidential race. The Venezuelan
economy has been growing strongly in 2012, with a forecast of 5% growth for the year, fueled by
government spending made possible by high oil prices. Numerous social programs or “missions”
of the government helped forged an emotional loyalty among Chávez supporters. This includes a
well-publicized public housing program. Critics maintain the program had the purpose of
boosting the popularity of the Chávez government for the upcoming election, and will do little to
resolve the country’s housing shortage.24
Another significant advantage for Chávez is that his electoral campaign used state resources and
state-controlled media for campaign purposes. This included the use of broadcast networks,
which are required to air the president’s frequent and lengthy political speeches.25 Observers
maintain that the government’s predominance in television media is overwhelming.26
There were several areas of vulnerability for President Chávez, however, that posed challenges to
his support. These included Venezuelans’ concerns about high rates of crime (including murder
and kidnapping) and an economic situation characterized by high inflation and economic
mismanagement that has led to periodic shortages of some food and consumer products and
electricity outages.27
Earlier in 2012, a wildcard in the presidential race was Chávez’s health status, but in July 2012
Chávez claimed to have bounced back from his second bout of an undisclosed form of cancer
since mid2011; his campaign appearances, however, were far more limited than those of Capriles.
If Chávez had been unable to run because of his health, many observers maintain that Capriles
would have had a good chance at defeating another PSUV presidential candidate.
In the lead up to the election, some observers had concerns about the potential reaction of the
Venezuelan military in the likelihood of an opposition victory. Before General Henry Rangel
became defense minister, he maintained in a November 2010 press interview that military was
“wedded to [Venezuela’s] socialist political project,” and that neither the military nor the public
would support an opposition government that would try to overturn the project. The comments
raised doubts about whether the military would accept an opposition victory,28 although after
becoming defense minister, then General Rangel said that the military would respect the result of
the election whatever the result.29

24

Jordi Miro, “As Elections Looming, Chávez Rolls Out Housing for the Poor,” Agence France Presse, June 25, 2012;
and William Neuman, “Building Loyalty, With Bricks and Mortar,” New York Times, July 14, 2012.
25
“Venezuela Politics: Quick View—Mr. Chávez Maintains Lead Ahead of October Election,” EIU ViewsWire, July
27, 2012.
26
Genaro Arriagada and José Woldenberg, “The Elections in Venezuela, October 7, 2012, Executive Summary,”
Wilson Center, September 2012.
27
William Neuman, “Price Controls Keep Venezuela Cupboards Bare,” New York Times, April 21, 2012; and Peter
Wilson, “Food Shortages Bode Ill for Chávez; Agriculture a Pillar of Venezuelan Leader’s Campaign,” USA Today,
August 13, 2012.
28
“La Polémica Entrevista de Rangel Silva a UNoticias,” Últimas Noticias (Venezuela), January 17, 2012, reprint of
November 8, 2010, interview from Últimas Noticias conducted by José Luis Carrillo; and Christopher Toothaker,
“Venezuela’s Hugo Chávez Defends General Whose Comments Stirred Democracy Concerns,” Associated Press,
November 14, 2010.
29
“Ministro Venezolano Dice Respetarán Resultados Elecciones,” AP Spanish Worldstream, February 10, 2012.

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Some observers also had expressed concern about potential violence in the case of a close race,
with fears centered on potential actions by radical elements on either side of the political divide
who might pursue violence if their candidate did not win.30 Concerns about violence were
heightened after two supporters of presidential candidate Henrique Capriles were shot and killed
during a campaign event in the western state of Barinas on September 29, 2012. Capriles
maintained that the killings reflected rising violence by Chávez supporters while the government
maintains that the killings were an isolated event.31

Election Results and Implications
President Chávez won reelection by a margin of 11%, receiving 55.25% of the vote compared to
44.13% for opposition candidate Henrique Capriles, according to the National Electoral Council
(updated results, as of October 11, 2012). Chávez received over 8.1 million votes, about 1.6
million more than Capriles, who received almost 6.5 million votes.32 President Chávez won all
but two of Venezuela’s 23 states (with the exception of Táchira and Mérida states), including a
very narrow win in Miranda, Capriles’s home state (see Figure 1). Unlike the last presidential
election in 2006, Venezuela did not host international observer missions. Instead, two domestic
Venezuelan observer groups monitored the vote. Most reports indicate that election day was
peaceful with only minor irregularities.
A White House spokesman, while acknowledging differences with President Chávez,
congratulated “the Venezuelan people on the high level of participation, as well as on what was a
relatively peaceful process.”33A State Department official added “that the views of the more than
6 million people who voted for the opposition should be taken into account going forward.”34
Credited with running an effective well-organized campaign that increased the strength of a
unified opposition, Capriles accepted defeat and congratulated President Chávez, but also
maintained that being president entails “working to solve the problems of all Venezuelans.”35
Capriles said that he would continue to serve the Venezuelan people. Soon after, on October 10,
2012, Capriles announced that he would run for reelection as governor of Miranda state in the
December 16, 2012 regional elections running against former Vice President Eliás Jaua who
stepped down from his position the same day in order to run (see “December 2012 State
Elections” below.)

30

Comments by Jennifer McCoy (Professor at Georgia State University and Director of the Americas Program at the
Carter Center) during presentation sponsored by the Washington Office on Latin America, “Venezuela: Countdown to
the October 7 Presidential Election,” March 6, 2012; Also see Dangerous Uncertainty Ahead of Venezuela’s Elections,
International Crisis Group, June 26, 2012.
31
Mery Mogollon and Chris Kraul, “Chávez Rival Mourns after Attack,” Los Angeles Times, October 2, 2012; and
Kejal Vyas, “Chávez Challenger Urges Peace After Shootings,” Wall Street Journal Online, October 1, 2012.
32
See the official results on the website of the National Electoral Council at
http://www.cne.gob.ve/resultado_presidencial_2012/r/1/reg_000000.html.
33
White House, Office of the Press Secretary, “Press Gaggle by Press Secretary Jay Carney En Route Bakersfield,
CA,” October 8, 2012.
34
“U.S.: Venezuelan Opposition Views Should be Considered,” Agence France Presse, October 8, 2012.
35
William Neuman, “Chávez Wins a Third Term in Venezuela Amid Historically High Turnout,” New York Times,
October 8, 2012.

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For the opposition, the election showed a significant strengthening of support – it received about
2.2 million more votes than in the last presidential election in 2006, and its share of the vote grew
from almost 37% in 2006 to 44% in 2012.
If Capriles had won the presidency, he would have faced a National Assembly still dominated by
Chávez supporters since the country’s next legislative elections are not due until September 2015.
Without legislative support, he would have faced difficulty in making significant policy changes.
For the United States, however, an opposition victory would likely have reduced tensions in
bilateral relations and allowed potential progress in the key areas of anti-drug and
counterterrorism cooperation.
For President Chávez, the election was his fourth presidential victory. It affirmed his longstanding
popular support as well as support for his government’s array of social programs that have helped
raise living standards for many Venezuelans. In his victory speech, President Chávez
congratulated the opposition for their participation and civic spirit and pledged to work with
them. At the same time, however, the president vowed that Venezuela would “continue its march
toward the democratic socialism of the 21st century.”36

December 2012 State Elections
In Venezuela’s December 16, 2012 state elections in which 23 governorships were at stake, voters
delivered a resounding victory to President Chávez and the PSUV, which won 20 out of 23 states.
Prior to the elections, the PSUV had held 15 state governorships with the balance held by
opposition parties or former Chávez supporters. The state elections took place with political
uncertainty at the national level as President Chávez was in Cuba recuperating from his fourth
cancer surgery (see “Chávez’s Health Status” below).
Opposition candidates won just three states, Amazonas, won by a former PSUV member; Lara,
where former PSUV member Henrí Falcón was reelected; and Miranda, where former MUD
presidential candidate Henrique Capriles Radonski was reelected, defeating former Vice President
Eliás Jaua. While the opposition suffered a significant defeat, most observers contend that
Capriles’s win solidified his status as the country’s major opposition figure, and as the most likely
the standard bearer of the Democratic Unity Roundtable (MUD) in a future presidential
election.37

Chávez’s Health Status and Political Implications
Since mid-2011, President Chávez’s precarious health situation has raised questions about
Venezuela’s political future. Most recently, a fourth difficult surgery in December 2012 with
significant complications for the President has resulted in Venezuela indefinitely postponing the
country’s presidential inauguration scheduled for January 10, 2013.

36

Laurent Thomet, “Chávez Reaches Out to Opposition After Victory,” Agence France Presse, October 8, 2012.
Dr. Dan Hellinger, “Caracas Connect Venezuela Update,” Center for Democracy in the Americas, December 20,
2012.
37

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President Chávez’s health threats date back to June 2011, when the President underwent
emergency surgery for a “pelvic abscess.” The initial operation took place on June 11, followed
by another operation (date unknown) to remove a cancerous tumor. Rumors were abounding
about Chávez’s health until June 30, when Chávez, from Cuba, announced on Venezuelan
television that he had cancer, although the president did not disclose the type of cancer he was
battling. Several days later, Chávez returned to Caracas on July 4, 2011, in order to be in the
country the next day for its bicentennial celebrating Venezuelan independence from Spain.
Chávez traveled to Cuba several times for chemotherapy beginning in mid-July 2011, and by
mid-October declared that he had beaten cancer.38 Chávez appeared to be frail in the summer and
fall, and gave up most public appearances including his weekly Sunday television program, Alo
Presidente.
By late 2011, however, Chávez had returned to public appearances, including a meeting of Latin
American and Caribbean leaders at the founding of the Community of Latin American and
Caribbean States (CELCAC) in Caracas in early December 2011. He hosted Iranian President
Mahmoud Ahmadinejad in early January 2012 and also returned to his weekly television
program. In an apparent attempt to send a message that his health had returned, on January 13,
2012, Chávez gave a marathon address to Venezuela’s National Assembly that lasted more than
nine hours.39
Just several weeks later, however, on February 21, 2012, Chávez announced that his doctors had
found a new lesion in the same area of his pelvic region requiring surgery. He returned to Cuba
for the surgery on February 28 and confirmed on March 4 that the lesion was malignant. Chávez
headed home to Venezuela on March 16, but returned again to Cuba multiple times over the next
three months for radiation treatment. The president has never disclosed the type of cancer that he
is battling, but doctors reportedly have speculated that it is prostate, colon, or bladder cancer.40 In
early July 2012, however, Chávez once again maintained that he was “cancer free,” and ready to
take on a tough reelection campaign.41
After winning reelection to another six-year term, Chávez returned to Cuba in late November
2012 for medical treatment. Upon his return to Venezuela, Chávez announced on December 8,
2012, that his cancer had returned and that he would soon undergo a fourth cancer surgery in
Cuba. Most significantly, Chávez announced his support for Vice President Nicolás Maduro if
anything were to happen to him. (Maduro had been sworn into office on October 13, 2012, and
retained his position as foreign minister, which he has held since 2006. Under Venezuela’s
Constitution, the president has the power to appoint and remove the vice president; it is not an
elected position.) According to Chávez: “If something happens that sidelines me, which under the
Constitution requires a new presidential election, you should elect Nicolás Maduro.”42 Chávez
reportedly faced complications during and after his December 11 surgery, and while there were
some indications of improvement by Christmas 2012, by year’s end the President faced new
respiratory complications.

38

Simon Romero, “Chávez Says He Has Beaten Cancer,” New York Times, October 21, 2011.
William Neuman, “Chávez After Treatment for Cancer, Gets His Bluster Back and Flaunts It,” New York Times,
January 22, 2012.
40
Jim Wyss, “Chávez in Good Condition After Surgery,” Miami Herald, February 28, 2012.
41
Valeria Pacheco, “Chávez Insists He Is ‘Totally’ Cancer-Free,” Agence France Presse, July 9, 2012.
42
Juan Forero, “Chávez Heads to Cuba for 4th Surgery,” Washington Post, December 10, 2012.
39

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Chávez’s grave health condition has introduced a significant measure of uncertainty into
Venezuela’s political system. After considerable public speculation about the inauguration
scheduled for January 10, 2013, Vice President Maduro announced on January 8 that Chávez
would not be sworn in that day. Instead, the Vice President invoked Article 231 of the
Constitution, maintaining that the provision allows the President to take the oath of office before
the Supreme Court at a later date.43
A day later, on January 9, 2013, Venezuela’s Supreme Court upheld this interpretation of the
Constitution, with the court’s President, Luisa Estella Morales, maintaining that Chávez could
take the oath of office before the Supreme Court at a later date when his health improves. Current
government officials also would continue to fully exercise their functions after January 10,
essentially allowing Vice President Maduro and other ministers to remain in power. The Supreme
Court President also maintained that Chávez’s medical treatment in Cuba was not a “temporary
absence” involving Article 234 of the Constitution, but rather such a situation that was anticipated
by Article 231, which allows for the oath of office to be taken at a later date. She also ruled out
convening a medical board at this time to assess the health of the President (as outlined in Article
233 of the Constitution) that would certify whether Chávez’s condition constituted permanent
incapacity.44 (See Table 1 for the language of Venezuela’s relevant constitutional provisions.)
Some opposition leaders, as well as some Venezuelan legal scholars, have argued that the January
10 inauguration date is fixed by Article 231, and that since Chávez could not be sworn in on that
date, then the President of the National Assembly, Diosdado Cabello, should have been sworn in
as interim or caretaker President until either a new election was held or Chávez recovered.45
Opposition leader Henrique Capriles appeared to accept the Supreme Court’s interpretation of the
Constitution, but maintained that it did not end the uncertainties facing the country.46 He
maintains that the court’s decision was politically motivated to deal with a reported power
struggle between Cabello and Vice President Maduro. According to Capriles: “The excuses are
over....Mr. Maduro, you have to step up and govern, and solve the problems of all Venezuelans
now.”47
Many Latin American leaders expressed hope for Chávez’s recovery, and Brazil maintained that
its support for the delay in the President’s inauguration. Leaders from Bolivia, Ecuador, and
Uruguay also announced that they would attend a rally in Caracas on January 10 to express their
support for Chávez.
The State Department has maintained that the potential succession issue as well as the delay of
the presidential inauguration is one for Venezuelans to decide, not the United States, but has
stressed that the decision needs to be consensual. According to a State Department spokesman:
43

“President Chávez formalizará juramentación después el 10-E ante el TSJ,” Agencia Venezolana de Noticias, January
8, 2013.
44
“TSJ: President Chávez se juramentará cuando cese la causa sobrevenida,” Agencia Venezolana de Noticias, January
9, 2013; Jim Mannion, “Venezuela Top Court Upholds Delay of Chávez Swearing-in,” Agence France Presse, January
9, 2013.
45
Juan Forero, “Chávez Will Not Return for Oath,” Washington Post, January 9, 2013; “Los académicos venezolanos
advierten: ‘El aplazamiento que quiere el chavismo es inconstitucional,’” ABC (Madrid), January 9, 2013, available at
http://www.abc.es/internacional/20130109/abci-profesores-venezuela-comparecencia-chavez-201301092040.html.
46
Jim Mannion, “With Chávez Absent, Venezuela Launches New Presidential Term,” Agence France Presse, January
10, 2013.
47
Jim Wyss, “Venezuela’s Chávez Starts New Term, But VP Maduro Holds Reins,” Miami Herald, January 10, 2013.

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“We do not believe that there is a made-in-America solution for Venezuela’s transition. Only
Venezuelans can make that set of decisions. This is the message that we are giving to Venezuelans
of all stripes, that we want to see any transition be democratic, be constitutional, be open, be
transparent, be legal within Venezuela, and that it has to be decided by Venezuelans.”48
If Chávez does not recover, Venezuela will face a new presidential election. Article 233 of the
Constitution requires that a new election is to be held within 30 days if the president dies or is
incapacitated during the first four years of his term.49 President Chávez himself acknowledged
before his recent operation in December 2012 that new elections would be needed if anything
were to happen to him. In the scenario of a new election, while Henrique Capriles would likely be
the opposition candidate, and would be advantaged by not having Chávez on the ballot, many
observers contend that sympathy for Chávez would engender support for a Chavista candidate,
most likely Vice President Maduro, aiming to protect Chávez’s legacy and programs.
Table 1. Venezuela’s Constitutional Provisions:
Presidential Oath and Absences (Absolute and Temporary)
Article
231

The candidate elected will enter into possession of the position of President of the Republic [on] the
tenth of January of the first year of his constitutional term, by means of [an] oath before the National
Assembly. If for any supervening reason the President of the Republic cannot enter into [the]
possession before the National Assembly, he will do so before the Supreme Tribunal of Justice.

Article
233

Absolute absences [faltas] of the President of the Republic will be: death, renunciation, dismissal
[destitución] decreed by sentence of the Supreme Tribunal of Justice, permanent physical or mental
incapacity certified by a medical board designated by the Supreme Tribunal of Justice and with the
approval of the National Assembly, abandonment of the position, declared by the National Assembly,
as well as the popular revocation of his mandate.
When the absolute absence of the President elect takes place before entering into [the] possession [of
office], there will be a new universal, direct and secret election within the following thirty consecutive
days. Until the new President is elected and enters into [the] possession [of office], the President of
the National Assembly will take charge of the Presidency of the Republic.
When the absolute absence of the President of the Republic takes place during the first four years of
the constitutional term, there will be a new universal and direct election within the following thirty
consecutive days. Until the new President is elected and enters into [the] possession [of office], the
Executive Vice President will take charge of the Presidency of the Republic.
In the cases above, the new President will complete the corresponding constitutional term.
If the absolute absence takes place during the last two years of the constitutional term, the Executive
Vice President will assume the Presidency of the Republic until completing the same.

Article
234

In the temporary absences [faltas] of the President of the Republic [he] will be substituted by the
Executive Vice President for up to ninety days, extendible by decision of the National Assembly for
ninety days more.
If a temporary absence lasts for more than ninety consecutive days, the National Assembly will decide
by majority of its members if it must be considered that there is an absolute absence.

Source: Constitution of the Bolivaran Republic 1999 (English translation) in Constitutions of the Countries of
the World (Oceana); “Bolivarian Republic of Venezuela, Constitution of 1999 with Reforms through 2009,”
Political Database of the Americas, Georgetown University, available at http://pdba.georgetown.edu/
Constitutions/Venezuela/vigente.html.
48

U.S. Department of State, Daily Press Briefing, January 3, 2013. Also see press briefings for January 8-9, 2013.
“Bolivarian Republic of Venezuela, Constitution of 1999 with Reforms through 2009,” Political Database of the
Americas, Georgetown University, available at http://pdba.georgetown.edu/Constitutions/Venezuela/vigente.html.
49

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Economic Conditions
With an estimated 211 billion barrels of proven oil reserves (the largest in the hemisphere, up
from previously reported 99 billion in proven reserves), Venezuela’s major economic sector is
petroleum, which accounts for 90% of exports, more than 30% of its gross domestic product, and
half of the government’s fiscal income.50 The country is classified by the World Bank as an upper
middle income developing country because of its relatively high per capita income of $11,820
(2011).51
Despite Venezuela’s oil wealth, economic conditions in the country deteriorated in the 1990s. The
percentage of Venezuelans living in poverty (income of less than $2 a day) increased from 32.2%
to 48.5% of the population between 1991 and 2000, while the percentage of the population in
extreme poverty (income of less than $1 a day) increased from 11.8% in 1990 to 23.5% in 2000.52
In 2002-2003, the country’s political instability and polarization between the government of
populist President Hugo Chávez and the political opposition contributed to a poor investment
climate, capital flight, and declines in gross domestic product (GDP). A national strike
orchestrated by the political opposition from late 2002 to early 2003 contributed to a contraction
of the national economy by almost 9% in 2002 and 7.8% in 2003.53
From 2004-2008, however, Venezuela benefitted from the rise in world oil prices that began in
2004. Fueled by the windfall from oil price increases, the Venezuelan economy grew by over
18% in 2004 and averaged 8.6% growth annually from 2005 through 2008 (see Figure 2). The
economic boom allowed President Chávez to move ahead with economic goals that fit into his
“Bolivarian revolution.” These included the expansion of a state-led development model,
renegotiation of contracts with large foreign investors (especially in the petroleum sector) for
majority government control, and the restructuring of operations at the state oil company,
Petroleos de Venezuela S.A. (PdVSA). The government also nationalized numerous enterprises,
including telecommunications, electricity, and steel companies, as well as cement, coffee, sugar,
flour, and milk production facilities.
The economic boom also allowed President Chávez to increase expenditures on social programs
associated with his populist agenda. The government began implementing an array of social
programs and services known as misiones or missions. There have been some 25 missions
offering a wide array of services in the fields of education, health, nutrition, the environment,
sports, culture, and housing, as well as targeted programs for indigenous rights and services for
street children and adolescents.54 As a result of the booming economy and increased social
spending, poverty rates in Venezuela declined from 48.6% in 2002 to 27.6% in 2008, with
extreme poverty or indigence falling from 22.2% to 9.9% over the same period.55
50
World Bank, “Venezuela Overview,” available at http://www.worldbank.org/en/country/venezuela/overview; and
“Worldwide Look at Reserves and Production,” Oil & Gas Journal, December 5, 2011.
51
World Bank, Data by Country, Venezuela, RB, available at http://data.worldbank.org/country/venezuela-rb.
52
World Bank, “Venezuela: Interim Country Assistance Strategy,” November 18, 2002, Report No. 25125-VE.
53
Economist Intelligence Unit, Country Data Tool.
54
For background on some of the missions, see “Fact Sheet: Social Justice in Venezuela,” Embassy of the Bolivarian
Republic of Venezuela, Washington, DC, July 2008.
55
U.N. Economic Commission for Latin America and the Caribbean (ECLAC), Social Panorama of Latin America,
(continued...)

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Figure 2.Venezuela: GDP Growth (%), 2005-2012
12
10

Percent

8
6
4
2
0
-2
-4

Percent

2005

2006

2007

2008

2009

2010

2011

2012
(est)

10.3

9.9

8.8

5.3

-3.2

-1.5

4.2

5

Years
Source: Economist Intelligence Unit, Country Data Tool.

The global financial crisis and associated drop in the price of oil had significant negative effects
on the Venezuelan economy, which contracted 3.2% in 2009 and 1.5% in 2010. This made
Venezuela the only country in South America, and one of the few in the region, to continue to
decline economically in 2010, and poverty rates increased slightly in that year. Economic growth
returned in 2011, however, with a growth rate of 4.2% because of the rise in oil prices and
because of increased central government expenditure. The government increased its fiscal
spending in order to help Chávez in the October 2012 presidential election. With this spending
and high oil prices, estimated growth for 2012 is 5%.56 (See Figure 2.)
The Venezuelan government continues to face significant economic challenges. Over the past four
years, high levels of inflation, averaging almost 28% annually from 2008 to 2011, have eroded
purchasing power. The estimate for 2012 is almost 21%.57 (See Figure 3.) In addition to inflation,
there have been periodic shortages of basic food staples and other products because of price
controls that have stifled local production. The government’s response to shortages has been to
nationalize some domestic agricultural producers or distributors.
Venezuela’s private sector describes the business community as being under siege from the
government because some companies have been nationalized without compensation and without
appropriate legal procedures being followed. In June 2010, Venezuelan authorities discovered
30,000 tons of rotten food at a government warehouse that was supposed to be delivered to staterun supermarkets known as Mercal. The scandal prompted widespread criticism of the
government, and raised questions about its strategy of taking over more economic activities.
(...continued)
2010, Briefing Paper, November 2010, p. 13.
56
“Venezuela Country Report,” EIU, December 2012.
57
Ibid.

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Since 2002, hundreds of companies, both domestic and foreign, have been nationalized.
Companies that have been nationalized under the Chávez government are in a variety of
economic sectors, including energy, food and agriculture, finance, heavy industry, gold, steel,
telecommunications, electricity, transportation, and tourism.
Figure 3.Venezuela: Consumer Inflation (average %), 2005-2012
35
30.4

30

27.1

28.2
26.1

25

Percent

20.9
18.7

20
16
13.7

15
10
5
0
2005

2006

2007

2008

2009

2010

2011

2012
(est)

Source: Economist Intelligence Unit, Country Data Tool.

While the government maintains that it will provide compensation for the nationalizations,
foreign companies are often forced to seek settlement through international arbitration.58 There
are currently 28 pending cases against Venezuela at the International Centre for Settlement of
Investment Disputes (ICSID) affiliated with the World Bank.59 In January 2012, ExxonMobil won
a settlement valued at some $900 million at the International Court of Arbitration (of the
International Chamber of Commerce). The Chávez government reportedly welcomed the
settlement because ExxonMobil had sought much more, but the company has another outstanding
case against Venezuela at the ICSID that could provide it with a potentially much more
significant settlement. President Chávez announced in early January 2012 that he would not
recognize any decision made by the ICSID, and later in the month his government began
procedures to withdraw from the organization. Some analysts, however, maintain that that the
withdrawal process will be complex and could take as long as 15 years and involve Venezuela’s
renegotiation of bilateral investment treaties with over 20 countries.60
In January 2010, the Venezuelan government took action to shore up its fiscal situation by
devaluing Venezuela’s currency, the bolivar fuerte, which increased the value of its oil earnings
and boosted government revenues. The government shifted the official exchange rate from
Bolivares Fuertes (BsF) 2.15/U.S. $1 to BsF2.6/U.S.$1 for essential imports such as food,
58
U.S. Department of Commerce, “Doing Business in Venezuela: 2011 Country Commercial Guide for U.S.
Companies.”
59
See the ICSID’s website at http://icsid.worldbank.org/ICSID/Index.jsp.
60
“Venezuela’s ICSID Exit Will Not Halt Exxon Arbitration,” Oxford Analytica, January 31, 2012.

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medicine, and for public-sector projects and strategic sectors, and established a second fixed
exchange rate of BsF4.3/U.S.$1 for other imports. The increased revenue enabled the government
to continue spending ahead of the September 2010 legislative elections, but also increased
inflationary pressure.
In January 2011, the government unified the two fixed foreign exchange rates by eliminating the
BsF2.6/U.S.$1 rate for essential imports in favor of a rate of BsF4.3/U.S.$1 for all imports.
According to some analysts, the government’s move appears to be an effort to reduce the
complexity of the multiple exchange-rate system, but the action has raised concerns about an
increase in inflation. The government still retains an exchange rate of BsF5.4/U.S.$1 for bond
swaps operated by the Central Bank, while the illegal black market rate is estimated at
BsF9.3/U.S.$1, a reflection of the continued overvaluation of Venezuela’s currency.61 Given the
overvaluation, economic analysts expect Venezuela to devalue its currency again in 2013.62
As noted above, Venezuela still remains highly dependent on oil, which accounts for some 90%
of its exports. Because of its substantial oil exports, the country generally runs a positive trade
balance. The country’s trade surplus began to grow significantly as oil prices began to increase in
2004. Venezuela’s trade surplus grew from $16.7 billion in 2003 to a high of $44 billion in 2008.
The decline in the price of oil beginning in 2009 reduced the country’s exports by about 40%,
from $95 billion in 2008 to $57 billion in 2009. During the same period, imports declined at a
slower rate so that the trade surplus declined to almost $18 billion in 2009. Since then, with the
recovery and increase of oil prices, the trade surplus grew to $27 billion in 2010 and $46 billion
in 2011. (See Table 2.)
In terms of export markets, Venezuela’s oil-based economy is highly dependent on the United
States and has been for many years, even though the U.S. share of Venezuela’s oil exports has
been declining in recent years. The country is a major supplier of foreign oil to the United States,
providing almost 10% of U.S. crude oil imports in 2011.63 In 2010, the United States was the
destination of about 40% of Venezuela’s total exports. Ten years earlier—in 2000—about 55% of
Venezuela’s exports were destined for the United States. The percentage of Venezuela’s imports
that come from the United States has also declined somewhat over time, although the United
States still remains the single largest country of origin for Venezuelan imports. In 2010, about
29% of Venezuela’s imports were from the United States, while 10 years earlier, the United States
was the origin of about 38% of Venezuela’s imports.64
Table 2. Venezuela’s Trade Balance, 2004-2011
U.S. $ millions

Exports
(f.o.b)

2004

2005

2006

2007

2008

2009

2010

2011

39,668

55,716

65,578

69,980

95,021

57,603

65,745

92,602

61

“Venezuela Country Report,” EIU, February 2011, March 2012, and August 2012; and “Venezuela Finance:
Operating in the Shadows,” EIU, February 11, 2011.
62
“Venezuela: Currency Devaluation: When, Not If,” Latin America Monitor, September 2012; “Venezuela Country
Report,” EIU, December 2012.
63
U.S. Energy Information Administration, “Petroleum: U.S. Imports by Country of Origin.”
64
Calculations were made utilizing trade statistics drawn from the International Monetary Fund’s Direction of Trade
Statistics, Yearbooks for 2004 and 2011.

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2004

2005

2006

2007

2008

2009

2010

2011

Imports
(f.o.b.)

17,021

14,018

33,583

46,660

50,971

39,646

38,613

46,441

Trade
Balance

22,647

41,698

31,995

23,320

44,050

17,957

27,132

46,141

Source: International Monetary Fund, International Financial Statistics, June 2012.

U.S. Policy
The United States traditionally has had close relations with Venezuela, a major supplier of foreign
oil to the United States, but there has been significant friction with the Chávez government. For
several years, U.S. officials have expressed concerns about human rights, Venezuela’s military
arms purchases (largely from Russia), its relations with Cuba and Iran, its efforts to export its
brand of populism to other Latin American countries, and the use of Venezuelan territory by
Colombian guerrilla and paramilitary forces. Declining Venezuelan cooperation on antidrug and
antiterrorism efforts also has been a U.S. concern. Since 2005, Venezuela has been designated
annually (by President Bush and President Obama) as a country that has failed to adhere to its
international anti-drug obligations. Since 2006, the Department of State has prohibited the sale of
defense articles and services to Venezuela because of lack of cooperation on antiterrorism efforts.

Bilateral Relations during the George W. Bush Administration
Tensions in relations turned especially sour in the aftermath of President Chávez’s brief ouster
from power in April 2002. Venezuela alleged U.S. involvement in the ouster, while U.S. officials
repeatedly rejected charges that the United States was involved.
In the aftermath of the coup, U.S. statements and actions of the interim government represented a
defining moment that influenced the course of bilateral relations over the next several years. After
Chávez’s ouster, the United States expressed solidarity with the Venezuelan people and
maintained that undemocratic actions committed or encouraged by the Chávez administration had
provoked the political crisis.65 Yet at the same time, the leader of the interim government was
dismantling the National Assembly, firing the Supreme Court, and suspending the Constitution.
The interim government’s hardline actions resulted in its loss of support from the Venezuelan
military, and paved the way for Chávez’s return to power. With Chávez’s return, the United States
called on him to heed the message sent by the Venezuelan people by correcting the course of his
administration and “governing in a fully democratic manner.”66 In contrast, many Latin American
nations immediately condemned the overthrow of Chávez, labeling it a coup. The failure of the
United States to quickly condemn the coup and instead to criticize President Chávez upon his
return to power set the stages for continued deterioration in U.S.-Venezuelan relations. Moreover,
even after the coup, the widespread perception that the United States supported continued efforts
by Venezuela’s opposition to remove President Chávez from power contributed to the downward
spiral in bilateral relations.
65

U.S. Department of State, “Venezuela: Change of Government,” Press Statement, April 12, 2002.
U.S. Department of State, International Information Program, Washington File, “White House Calls on Venezuela’s
Chávez to Preserve Peace, Democracy,” April 14, 2002.

66

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While strong political rhetoric from both U.S. and Venezuelan officials in the 2002 to 2006 period
contributed to elevated tensions in U.S. relations, the tenor of U.S. political rhetoric changed in
the second half of 2006. When Chávez spoke disparagingly of President Bush at the United
Nations in September 2006, U.S. officials refrained from responding to those personal attacks.
Likewise, when President Chávez led an anti-American rally in Argentina in March 2007 during
President Bush’s visit to Brazil and Uruguay, President Bush ignored the taunts and U.S. officials
emphasized that they wanted to focus on a positive agenda of U.S. engagement with Latin
America.
In the aftermath of Colombia’s March 1, 2008, bombing of a Revolutionary Armed Forces of
Colombia (FARC) camp in Ecuador that killed the terrorist group’s second in command,
Colombian forces captured laptops that contained files potentially linking the Venezuelan
government with efforts to support the FARC. In an apparent shift in policy, however, on June 8,
2008, President Chávez publicly urged the FARC to end its armed struggle, and release all
hostages.
In 2008, U.S. policy toward Venezuela appeared to be to refrain from getting into any unneeded
conflicts or spats with President Chávez, and instead to focus on a positive U.S. agenda for the
hemisphere. Then Assistant Secretary of State for Western Hemisphere Affairs Tom Shannon
stated in July 17, 2008, congressional testimony that “we remain committed to a positive
relationship with the people of Venezuela and have the patience and the persistence necessary to
manage our challenging relationship.” Shannon pointed out in his testimony that Venezuela “for
the first time in many years, expressed a willingness to explore improved relations with the
United States,” including counter-drug cooperation, and that “we have told Venezuela that we
would like to explore this diplomatic opening.”67
By September 2008, however, U.S. relations with Venezuela took a significant turn for the worse
when Venezuela expelled U.S. Ambassador Patrick Duddy in solidarity with Bolivian President
Evo Morales, who had expelled the U.S. Ambassador in La Paz after accusing him of fomenting
unrest; the United States responded in kind with the expulsion of Venezuelan Ambassador
Bernardo Alvarez. Also in September, U.S. officials criticized Venezuela’s efforts against drug
trafficking, and President Bush determined, for the fourth year in a row, that Venezuela had failed
demonstrably to adhere to its obligations under international narcotics control agreements. The
U.S. Treasury Department also froze the assets of two high-ranking Venezuelan government
officials and the former interior minister for allegedly helping the FARC with weapons and drug
trafficking. In October 2008, the Treasury Department froze the assets of an Iranian-owned bank
based in Caracas linked to an Iranian export bank that allegedly provided or attempted to provide
services to Iran’s ministry of defense.

Obama Administration Policy
During the 2008 U.S. presidential campaign, Barack Obama maintained that his Administration
would use principled bilateral diplomacy to engage with such adversaries in the region as
Venezuela under populist President Hugo Chávez. Nevertheless, tensions continued in U.S.Venezuelan relations, with President Chávez continuing “to define himself in opposition to the
67
Testimony of Thomas A. Shannon, Assistant Secretary of State for Western Hemisphere Affairs, hearing on
“Venezuela: Looking Ahead,” House Committee on Foreign Affairs, Subcommittee on the Western Hemisphere, July
17, 2008.

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United States, using incendiary rhetoric to insult the U.S. Government and U.S. influence in Latin
America.”68 While in mid-2009, Ambassadors were returned, in late 2010, the Chávez
government revoked an agreement for U.S. Ambassador-designate Larry Palmer to be posted to
Venezuela. The Obama Administration responded by revoking the diplomatic visa of the
Venezuelan Ambassador to the United States. Despite tensions in relations, the State Department
maintains that the United States remains committed to seeking constructive engagement with
Venezuela, focusing on such areas as anti-drug and counter-terrorism efforts.
Developments in 2009. A week before his inauguration, President Obama maintained in an
interview that President Chávez “has been a force that has impeded progress in the region,” and
expressed concern about reports that Venezuela is assisting the FARC.69 President Chávez
strongly criticized Obama for his comments, but subsequently stated that he would like to restore
bilateral relations to the same level as during the Clinton Administration. Chávez suggested that a
new period of constructive relations based on respect might be possible, but that it would depend
on the attitude of the President and Secretary of State.70
At the fifth Summit of the Americas held in Trinidad and Tobago in mid-April 2009, President
Obama met President Chávez along with other hemispheric leaders. Chávez maintained that he
would be open to the U.S. Ambassador returning to Caracas. Two months later, on June 25, 2009,
the State Department announced that the United States and Venezuela had exchanged diplomatic
notes and agreed to return respective ambassadors. This led to U.S. Ambassador to Venezuela
Patrick Duddy resuming his post in Caracas, and to the return of Venezuelan Ambassador
Bernardo Alvarez to Washington, DC.
The return of respective ambassadors raised some hopes of an overall improvement in bilateral
relations, but this did not occur. In an interview with Globovisión in early July 2009, Secretary of
State Clinton maintained that there needs to be a dialogue between the United States and
Venezuela on a range of issues, and that there are ways for countries that do not agree on many
issues to have a conversation. At the same time, with regard to the political situation in
Venezuela, Clinton maintained that she hoped to see over the next months “recognition that you
can be a very strong leader and have very strong opinions without trying to take on too much
power and trying to silence all your critics.”71 State Department officials continued to express
concerns about the intimidation of the news media in Venezuela, and steps taken by the
government to restrict political participation and debate, and Secretary of State Clinton raised
questions regarding Venezuela’s military purchases.72
Developments in 2010. In February 2010, then-Director of National Intelligence (DNI) Dennis
Blair testified before the Senate Select Committee on Intelligence on the annual threat assessment
of the U.S. intelligence community. According to Blair, President “Chávez continues to impose an
authoritarian populist political model in Venezuela that undermines democratic institutions.” Blair
68

U.S. Department of State, “Background Note: Venezuela,” September 2, 2011.
Nestor Ikeda, “Obama: Chávez “ha impedido” progreso latinoamericano,” AP Spanish Worldstream, January 18,
2009; and Juan Forero, “Obama and Chávez Start Sparring Early,” Washington Post, January 19, 2009.
70
“Venezuelan President Chávez Interviewed on CNN,” CQ Newsmaker Transcripts, February 3, 2009.
71
U.S. Department of State, U.S. Secretary of State Hillary Rodham Clinton, “Interview with Leopoldo Castillo of
Globovision,” July 7, 2009.
72
U.S. Department of State, Secretary of State Hillary Rodham Clinton, “Remarks with Uruguayan President Tabare
Vazquez After Their Meeting,” September 15, 2009.
69

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maintained that with regard to foreign policy, “Chávez’s regional influence may have peaked, but
he is likely to support likeminded political allies and movements in neighboring countries and
seek to undermine moderate, pro-U.S. governments.” Blair maintained that “Chávez and his allies
are likely to oppose nearly every U.S. policy initiative in the region, including the expansion of
free trade, counter drug and counterterrorism cooperation, military training, and security
initiatives, and even U.S. assistance programs.”73
In August 2010, President Chávez criticized comments by U.S. Ambassador-designate to
Venezuela Larry Palmer for his responses to questions for record for his nomination before the
Senate Foreign Relations Committee that touched on Cuba’s influence in the Venezuelan military
and ties between members of the Venezuelan government and the FARC.74 The Venezuelan
government maintained that it would not accept Palmer as U.S. Ambassador in Caracas, and on
December 20, 2010, officially revoked its agreement for the appointment of Palmer as
Ambassador. The State Department responded on December 27, 2010, by revoking the diplomatic
visa of Ambassador Bernardo Alvarez. The full Senate did not act on Palmer’s nomination by the
end of the 111th Congress, so the nomination was sent back to the President in December 2010.
No further action has been taken to restore ambassadors.
Developments in 2011. In February 2011, Director of National Intelligence (DNI) James Clapper
testified about President Chávez’s waning influence in Latin America. According to Clapper,
“deteriorating economic conditions in Venezuela and Chávez’s declining popularity at home and
abroad have limited his ability to exert influence beyond his core group of allies.”75
Also in February 2011 congressional testimony, then Assistant Secretary of State Arturo
Valenzuela criticized the December 2010 action of Venezuela’s outgoing National Assembly for
its approval of a law that delegated legislative authority to the executive for 18 months.
Valenzuela maintained that the action undermined the authority of the incoming National
Assembly and circumscribed its popular will. He maintained that the action “violates the doctrine
of the separation of powers and therefore contravenes the Inter-American Democratic Charter.”76
On May 11, 2011, the Department of State determined for the sixth consecutive year that
Venezuela was not cooperating fully with U.S. antiterrorism efforts. This determination was made
pursuant to Section 40A of the Arms Export Control Act (P.L. 90-629) and allowed for the
continuation of the U.S. arms embargo on Venezuela since 2006.
On May 24, 2011, the State Department also sanctioned the Venezuelan oil company, Petróleos
de Venezuela (PdVSA), pursuant to the Comprehensive Iran Sanctions, Accountability, and
Disinvestment Act of 2010 (P.L. 111-195) for providing two shipments of reformate, an additive
73
U.S. Senate Select Committee on Intelligence, “Annual Threat Assessment of the US Intelligence Community,”
prepared testimony by Dennis C. Blair, Director of National Intelligence, February 2, 2009, p. 32, available at
http://intelligence.senate.gov/100202/blair.pdf.
74
See the full text of the questions for the record submitted by Senator Richard G. Lugar, Senate Foreign Relations
Committee, July 27, 2010, available at http://lugar.senate.gov/issues/foreign/lac/venezuela/pdf/LugarPalmerQFR.pdf.
75
U.S. Senate Select Committee on Intelligence, ‘Worldwide Threat Assessment of the U.S. Intelligence Community,”
prepared testimony by James R. Clapper, Director of National Intelligence, February 16, 2011, available at
http://intelligence.senate.gov/110216/dni.pdf.
76
U.S. Department of State, Testimony of Arturo Valenzuela, Assistant Secretary of State for Western Hemisphere
Affairs, before the House Foreign Affairs Committee, Subcommittee on the Western Hemisphere, February 15, 2011,
available at http://www.state.gov/p/wha/rls/rm/2011/156598.htm.

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used in gasoline, to Iran, between December 2010 and March 2011. The shipments were valued at
around $50 million. Under the sanctions, PdVSA is prohibited from competing for U.S.
government procurement contracts, securing financing from the Export-Import Bank, and
obtaining U.S. export licenses. The sanctions specifically exclude PdVSA subsidiaries (Citgo)
and do not prohibit the export of oil to the United States.
In September 2011, as part of the annual narcotics certification process, President Obama again
determined that Venezuela had “failed demonstrably” to meet its obligations under international
counternarcotics measures. This marked the seventh consecutive annual designation of Venezuela
in this category. The justification accompanying the determination maintained that “individual
“members of the government and security forces security forces were credibly reported to have
engaged in or facilitated drug trafficking activities.”77 The justification noted some positive steps
taken by the Venezuelan government in the past year, including the transfer of several major drug
traffickers to the United States and other drug traffickers to third countries and a bilateral
counternarcotics agreement with Colombia.
Developments in 2012-2013. On January 8, 2012, the Department of State declared as persona
non grata the Venezuelan Consul General in Miami, Livia Acosta, and asked her to leave the
United States. In December 2011, a documentary featured on the Spanish-language network
Univisión had alleged that Iranian and Venezuelan diplomats in Mexico tried to recruit Mexican
students for plotting possible cyberattacks against the United States. Acosta, a Venezuelan
diplomat who had been based in Mexico, was recorded participating in the discussion with the
Mexican students.
The State Department issued the 2012 International Narcotics Control Strategy Report on March
7, 2012, which stated, as in previous reports, that Venezuela was one of the preferred trafficking
routes for the transit of cocaine out of South America. The State Department also reiterated that
the United States remained prepared to deepen anti-drug cooperation with Venezuela beyond the
currently limited case-by-case level of cooperation.
In a July 2012 press interview, President Obama maintained that his main concern about
Venezuela “is having the Venezuelan people have a voice in their affairs” and “having fair and
free elections.” With regard to Iran’s relations with Venezuela, the President maintained overall
concern about “Iran engaging in destabilizing activity around the globe,” but indicated that his
“sense is that what Mr. Chávez has done over the past several years has not had a serious national
security impact on us.”78 This was subsequently reiterated by the head of the U.S. Southern
Command, General Douglas Fraser, who maintained that he does not see Venezuela as a “national
security threat,” and that Iran’s connection with Venezuela is primarily diplomatic and
economic.79
In the aftermath of President Chávez’s October 2012 reelection, the Obama Administration, while
acknowledging differences with Chávez, congratulated the Venezuelan people on the high level of
participation and the relatively peaceful electoral process (see “Election Results and
77

White House, “Presidential Determination No. 2011-16, Presidential Determination on Major Illicit Drug Transit or
Major Illicit Drug Producing Countries for Fiscal Year 2012,” September 15, 2011.
78
Patricia Massei and Erika Bolstad, “Mitt Romney, GOP Howl Over President Barack Obama’s Remark About Hugo
Chávez,” Miami Herald, July 11, 2012.
79
Frank Bajak, “Top U.S. General: Venezuela Not a National Security Threat,” AP Newswire, July 31, 2012.

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Implications” above). Subsequently, in November 2012, the State Department’s Assistant
Secretary of State for Western Hemisphere Affairs Roberta Jacobson engaged in a conversation
with Vice President Maduro about improving bilateral relations, including greater cooperation on
counternarcotics issues.
In early January 2013, the State Department reiterated that the United States remains open to
dialogue with Venezuela on a range of issues of mutual interest, and subsequently confirmed the
Assistant Secretary’s conversation with Vice President Maduro in November. In light of the
setback in President Chávez’s health, a State Department spokesman maintained on January 9,
2013, that “regardless of what happens politically in Venezuela, if the Venezuelan government
and if the Venezuelan people want to move forward with us, we think there is a path that’s
possible. It’s just going to take two to tango.”80 With regard to U.S. views on Venezuela’s
potential political succession, the State Department has maintained that it is a decision for
Venezuelans to make, but would like to see any transition be democratic, constitutional, and legal
within Venezuela. (See “Chávez’s Health Status and Political Implications” above.)

U.S. Foreign Aid to Venezuela
Because of Venezuela’s oil wealth and relatively high per capita income level, the United States
has traditionally only provided small amounts of foreign assistance to Venezuela. In recent years,
assistance has focused on counternarcotics and support for democracy programs. Table 3 below
shows U.S. assistance level to Venezuela since FY2006.
From FY2002 to FY2007, Venezuela received small amounts of U.S. assistance under the State
Department’s Andean Counterdrug Initiative (ACI) focusing on counternarcotics cooperation and
judicial reform support. Since FY2008, no counternarcotics assistance has been requested for
Venezuela, although in FY2009, the United States provided $0.5 million in International
Narcotics Control and Law Enforcement (INCLE) assistance.
For a number of years, the United States has provided democracy-related assistance to Venezuela
through the U.S. Agency for International Development. In Table 3, all funding for the
Development Assistance (DA), Economic Support Funds (ESF), and Transition Initiatives (TI)
foreign aid accounts are for democracy-related funding. In addition, the United States has
supported democracy assistance in Venezuela through the U.S. government-funded National
Endowment for Democracy (NED), but this type of support has not been typically reflected in
U.S. foreign assistance funding statistics.
From 2002 through December 2010, USAID supported democracy projects in Venezuela through
its Office of Transition Initiatives (OTI) to provide assistance to monitor democratic stability and
strengthen the county’s democratic institutions. According to USAID, more than 600 small-grant
and technical assistance activities were funded by OTI from 2002 through 2010. The objectives
of the assistance, according to USAID, were to enhance access to objective information and
peaceful debate on key issues, and to promote citizen participation and democratic leadership.81

80

U.S. Department of State, Daily Press Briefing, January 3 and 9, 2013.
U.S. Agency for International Development, USAID/OTI Venezuela Annual Summary Report, October 2009September 2010.
81

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At the end of December 2010, USAID’s support for such activities for Venezuela was transferred
from OTI to USAID’s Latin America and Caribbean Bureau.
In FY2011 and FY2012, the United States provided $5 million and $6 million, respectively, in
ESF each year in democracy assistance for Venezuela, while for FY2013 the Obama
Administration requested $3 million in such assistance. According to the State Department’s
FY2013 Congressional Budget Justification, the assistance seeks to promote broad participation
in the democratic process by promoting good governance, raising awareness about social issues,
increasing confidence in the democratic process, and encouraging citizen participation.
Table 3. U.S. Foreign Aid to Venezuela by Account, FY2008-FY2013
U.S. $ millions
FY2008

FY2009

FY2010

FY2011

FY2012
(est.)

FY2013
(request)

ACI/INCLE

0.000

0.500

0.000

0.000

0.000

0.000

DA

6.519

0.000

0.000

0.000

0.000

0.000

ESF

2.976

5.000

6.000

5.000

6.000

3.000

TI

3.649

2.450

1.208

0.000

0.000

0.000

Total

13.144

7.950

7.208

5.000

6.000

3.000

Notes: ACI=Andean Counterdrug Initiative; DA=Development Assistance; ESF=Economic Support Funds;
INCLE = International Narcotics Control and Law Enforcement; TI=Transition Initiatives.
Sources: U.S. Department of State, FY2010-FY2013 Congressional Budget Justifications for Foreign Operations;
and FY2012 653(a) Foreign Aid Allocations, May 24, 2012.

In terms of congressional action on FY2013 foreign aid appropriations, the report to the House
Appropriations Committee bill, H.R. 5857 (H.Rept. 112-494), directs that $5 million in ESF be
provided for democracy programs in Venezuela, the same amount appropriated in FY2012, and
$2 million more than the Administration’s request for $3 million. In contrast, the report to the
Senate Appropriations Committee bill, S. 3241 (S.Rept. 112-172), recommends $3 million for
democracy programs in Venezuela to be administered by the National Endowment for Democracy
(NED) instead of USAID or the Department of State. The 112th Congress did not complete action
on a FY2013 full-year foreign operations appropriations, but it did approve a Continuing
Appropriations Resolution, FY2013 (P.L. 112-175) in September 2012, which funds regular
foreign aid accounts at the same level as in FY2012, plus 0.612% through March 27, 2013,
although specific country accounts are left to the discretion of responsible agencies. The 113th
Congress will need to address foreign aid appropriations for the balance of FY2013.
NED has funded democracy projects in Venezuela since 1992, but the level of funding increased
under the Chávez government. The FY2006 Foreign Operations appropriations measure (P.L.
109-102) provided $2 million in Democracy Funds for NED for democracy programs in
Venezuela. In subsequent years, NED’s funding amounted to more than $800,000 in FY2007 for
17 projects; over $1 million in FY2008 for 18 projects; $1.4 million in FY2009 for 14 projects;
almost $1.6 million in FY2010 for 21 projects, and $1.53 million in FY2011 for 27 projects.82
82

See NED’s website for a description of Venezuelan projects in FY2011, available at http://www.ned.org/where-wework/latin-america-and-caribbean/venezuela.

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The Venezuelan government and Chávez supporters have strongly criticized U.S. government
funding for democracy projects in Venezuela.83 They maintain that NED-funded groups were
headed by people involved in the overthrow of Chávez in April 2002 as well as a group, Súmate,
involved in the signature collecting process for the 2004 recall referendum campaign. Critics of
the USAID and NED democracy programs maintain that they meddle in Venezuelan domestic
politics. They argue that the United States should get out of the business of democracy-promotion
in Venezuela, maintaining that such activity lends credence to claims by Chávez and others that
the U.S. government is pursuing a policy of regime change.84
U.S. officials strongly defend U.S. democracy promotion activities in Venezuela, and Congress
has continued to fund such activities. In particular, U.S. officials criticized the Venezuelan
government’s efforts to intimidate the leaders of Súmate by charging them with conspiring against
the government. The State Department asserts that the charges are without merit, and constitute
an attempt “to intimidate members of civil society for exercising their democratic rights.”85
According to NED, its program in Venezuela “focuses on promoting citizen participation in the
political process, civil and political rights, freedom of expression and professional journalism,
and conflict mediation.” NED asserts that all of the Venezuelan programs that it funds operate on
a non-partisan basis.86 As a result of issues raised regarding NED’s programs in Venezuela, in
2004 Congress reaffirmed NED’s duty to ensure that all sponsored activities adhere to core NED
principles and required a comprehensive report on NED’s activities in Venezuela since FY2001
(Division B of P.L. 108-447, H.Rept. 108-792).
In December 2010, Venezuela’s outgoing National Assembly approved a measure that could
make it difficult for the U.S. government or other foreign donors to assist civil society groups in
Venezuela. The legislation prohibits civil society organizations involved in defending political
rights or monitoring the performance of government bodies from receiving international funds
and would impose stiff fines on those that do. As discussed below, human rights organizations
have expressed concern about the effect of the legislation.

Human Rights Concerns
Human rights organizations and U.S. officials have expressed concerns for several years about the
deterioration of democratic institutions and threats to freedom of speech and press in Venezuela
under the Chávez government. According to Human Rights Watch’s World Report 2012, “the
weakening of Venezuela’s democratic system of checks and balances under President Hugo
Chávez has contributed to a precarious human rights situation.” It maintained that “without
judicial checks on its actions, the government has systematically undermined the right to free
expression, workers’ freedom of association, and the ability of human rights groups to protect
rights.”87
83

For example, see testimony of Mark Weisbrot, Center for Economic and Policy Research, at a hearing of the Senate
Foreign Relations Committee on “The State of Democracy in Venezuela,” June 24, 2004.
84
Tom Barry, “The New Politics of Political Aid in Venezuela,” Venezuelanalysis.com, July 25, 2007 (updated and
corrected on August 25, 2007).
85
“United States Rejects Venezuelan Decision to Try Civic Group,” Department of State, Washington File, July 8,
2005.
86
National Endowment for Democracy, “NED Venezuela Programs FAQ,” available online at http://www.ned.org/
where-we-work/latin-america-and-caribbean/venezuela.
87
Human Rights Watch, World Report 2012: Venezuela, available at http://www.hrw.org/world-report-2012/world(continued...)

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An extensive Human Rights Watch report on Venezuela issued in July 2012 maintains that the
human rights situation in the country has become even more precarious in recent years.88 It noted
that the pro-Chávez majority in the National Assembly approved legislation in 2010 expanding
the government’s powers to limit free speech and punish its critics. It asserts that the Supreme
Court “has explicitly rejected the principle that the judiciary should serve as a check on
presidential power, while joining with the president in dismissing the authority of the InterAmerican system of human rights.” For almost a decade, President Chávez has not allowed the
Inter-American Commission on Human Rights to visit the country, while in July 2012 he
announced that Venezuela would withdraw from the jurisdiction of the Inter-American Court of
Human Rights. The report contends that “the accumulation of power in the executive, the removal
of institutional safeguards, and the erosion of human rights guarantees have given the Chávez
government free reign to intimidate, censor, and prosecute Venezuelans who criticize the
president or thwart his political agenda.”
The State Department’s 2011 human rights report (issued in May 2012) maintains that the
“principal human rights abuses reported during the year included government actions to impede
freedom of expression and criminalize dissent.”89 According to the State Department, the
Venezuelan government harassed and intimidated privately owned television stations, other media
outlets, and journalists. The government was reported to have thwarted judicial independence,
and to have used the judiciary to intimidate and selectively prosecute political, union, business,
and civil society leaders critical of the government. The State Department report also cites other
human rights problems such as unlawful killings; torture and degrading treatment; prison violence
and harsh prison conditions; inadequate juvenile detention centers; arbitrary arrests and
detentions; police corruption and impunity; interference with property rights; and threats against
domestic nongovernmental organizations. The significant problem of prison violence was
highlighted once again on August 19, 2012, when a clash between gangs at a prison in Miranda
state reportedly resulted in at least 25 deaths.
In terms of political prisoners, the State Department human rights report cites a Venezuelan NGO,
the Venezuelan Awareness Foundation, which listed 12 political prisoners in Venezuela at the end
of 2011—as of August 2012, the organization listed a total of 13 political prisoners.90 Numerous
other political prisoners have been released after being detained from a few days to several years.
In a prominent human rights case that captured world-wide attention, Judge María Lourdes Afiuni
was arrested and imprisoned on charges of corruption in December 2009 just hours after she had
ordered the release of businessman Eligio Cedeño (who subsequently fled to the United States),
who had been imprisoned since February 2007 in pretrial detention on charges of corruption and
embezzlement.91 President Chávez urged that the judge receive the maximum sentence of 30
(...continued)
report-2012-venezuela.
88
Human Rights Watch, Tightening the Grip, Concentration and Abuse of Power in Chávez’s Venezuela, July 17,
2012, available at http://www.hrw.org/reports/2012/07/17/tightening-grip-0.
89
See the full report at http://www.state.gov/j/drl/rls/hrrpt/humanrightsreport/index.htm?dlid=186550#wrapper.
90
Venezuela Awareness Foundation, “Lista de ciudadanos Venezolanos que son prisioneros políticos del Gobierno de
Hugo Chávez,” available at http://www.venezuelaawareness.com/Presos/indexpresos.asp.
91
For example, see the following white paper prepared by lawyers defending Eligio Cedeño, “Bolivarian Rule of
Lawlessness, The Eligio Cedeño Case: The Erosion of Judicial Autonomy under Hugo Chávez,” by Robert Amsterdam,
Gonzalo Himiob Santomé, and Antonio Rosich, June 2009, available at http://www.robertamsterdam.com/venezuela/
2009/06/new_white_paper_on_venezuelas_political_prisoners.htm.

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years. U.N. human rights experts criticized the judge’s arrest, maintaining that Venezuela’s
reprisal against the judge created a climate of fear that undermines the rule of law and obstructs
justice.92 According to Human Rights Watch, Judge Afiuni was held in deplorable conditions for
over a year, where she was repeatedly insulted and threatened by other inmates. She reportedly
received inadequate health treatment during her detention until she was released from prison and
placed under house arrest on February 2, 2011. International human rights groups, such as
Amnesty International and Human Rights Watch, have called for the charges to be dropped
completely.93 In early March 2012, the United Nations Working Group on Arbitrary Detention
asked Venezuela to release Judge Afiuni, maintaining that her detention was an act of retaliation
for her release of an individual whom the Working Group had asked to be released.94 Afiuni
maintained in an interview for a book published in November 2012 that she had been raped in
2010 while being held in a women’s prison and then had an abortion after becoming pregnant.95
In another high-profile case, retired General Raúl Baduel, a former defense minister in the
Chávez government, was sentenced to 7 years and 11 months in prison in May 2010 on
corruption-related charges. Baduel, who was first arrested and imprisoned in April 2009, was a
strong critic of President Chávez during the 2007 constitutional reform.
Venezuelans at times have turned to using hunger strikes as a form of protest against the
government. On August 30, 2010, hunger striker Franklin Brito died at a Venezuelan military
hospital. Brito had been engaged in a battle with the Venezuelan government beginning in 2004
over the seizure of a portion of his farm by squatting farmers who were given permission by
Venezuela’s National Land Institute (INTI). On February 22, 2011, more than 80 students ended a
23-day hunger strike after the government agreed to review cases of alleged political prisoners
and to establish a committee to discuss the students’ grievances. The government conditionally
released several of those detained, including jailed opposition legislator Biagio Pilieri.96 In May
2011, a former PdVSA employee who had been fired (along with some 19,000 oil workers during
and after the 2002-2003 opposition strike) died of respiratory failure after a five-month hunger
strike to protest the firings.97 In November 2011, a jailed newspaper editor, Leocenis Garcia,
imprisoned for insulting public officials and inciting hatred, was released after an almost twoweek hunger strike.98
NGOs in Venezuela and human rights organizations abroad have expressed concern about
legislation approved in December 2010, the Law for the Defense of Political Sovereignty and
National Self-Determination, that prohibits civil society organizations that “defend political
rights” or “monitor the performance of government bodies” from receiving international funds
92

U.N. Experts Say Venezuela’s Chávez Creating Fear,” Reuters, December 16, 2009.
“Venezuela: Judge Afiuni Before the United Nations Human Rights Council,” Human Rights Watch, March 8, 2011;
and “Venezuela: Amnesty International Welcomes the Granting of House Arrest to Judge Afiuni,” Amnesty
International, Public Statement, February 4, 2011.
94
“UN Working Group Calls for Judge Afiuni’s Release,” El Universal (Venezuela), March 7, 2012.
95
María Eugenia Díaz and William Neuman, “Venezuelan Judge who Angered Chávez Says She Was Raped While in
Prison,” New York Times, November 27, 2012.
96
“Chávez and the Students,” Latin American Andean Group Report, March 2011; “Venezuela’s Student Hunger
Strikes Claim a Deal,” LatinNews Daily, February 23, 2011; and “Venezuela: Chávez Plays Defence,” EIU, Business
Latin America, April 11, 2011.
97
U.S. Department of State, Country Report on Human Rights Practices 2011, Venezuela, May 24, 2012.
98
Christopher Toothaker, “Anti-Chávez Newspaper Editor Released in Venezuela, Hospitalized Following Hunger
Strike,” Associated Press, November 21, 2011.
93

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and would impose stiff fines on those that do. According to Human Rights Watch, the measure
would make it very difficult for Venezuelan human rights to secure sustainable financing.99
Human Rights Reporting on Venezuela
Amnesty International, Human Rights in Bolivarian Republic of Venezuela, http://www.amnesty.org/en/region/
venezuela
Committee to Protect Journalists, http://www.cpj.org/americas/venezuela/; Venezuela’s Private Media Wither
Under Chávez Assault, August 2012, available at http://www.cpj.org/reports/venezuela2012-english.pdf
Human Rights Watch, http://www.hrw.org/en/americas/venezuela; Tightening the Grip, Concentration and Abuse of
Power in Chávez’s Venezuela, July 17, 2012, available at http://www.hrw.org/reports/2012/07/17/tightening-grip-0
Inter-American Commission on Human Rights (IACHR), http://www.cidh.oas.org/DefaultE.htm; Annual
Report of the IACHR 2011, April 2012, chapter IV includes an extensive section on Venezuela, available at
http://www.oas.org/en/iachr/docs/annual/2011/TOC.asp; Democracy and Human Rights in Venezuela, December 30,
2009, available at http://www.cidh.org/countryrep/Venezuela2009eng/VE09.TOC.eng.htm
Programa Venezolano de Educación-Acción en Derechos Humanos (PROVEA), http://www.derechos.org.ve/
Reporters without Borders, http://en.rsf.org/venezuela.html
U.S. State Department, Country Report on Human Rights Practices 2011, May 24, 2012, Venezuela,
http://www.state.gov/j/drl/rls/hrrpt/humanrightsreport/index.htm?dlid=186550#wrapper

Threats to Freedom of Expression
As noted above, the Chávez government has taken actions in recent years that have undermined
the right to free expression. While there is vibrant political debate in Venezuela reflected in the
print and broadcast media, the government has discriminated against media that offer views of
political opponents, and has used laws and regulations regarding libel and media content as well
as legal harassment and physical intimidation that, according to human rights groups, have
effectively limited freedom of speech and the press in some cases. The Chávez government has
also expanded state-owned media, including radio and television stations, newspapers, and
websites in order to counter what it viewed as imbalance in the media environment. In August
2012, the Committee to Protect Journalists issued a special report documenting the Chávez
government’s attacks on private media and its establishment of a large state media that
disseminates government propaganda and often is used to launch smear campaigns against
critics.100
RCTV Case. As noted above, President Chávez’s May 2007 closure of RCTV sparked significant
protests and worldwide condemnation. The Venezuelan government maintained that it did not
renew RCTV’s broadcast license because of the station’s actions in support of the April 2002
coup that temporarily removed Chávez from power. The 2007 closure shut down RCTV’s general
broadcast station that was available nationwide, but allowed RCTV to operate with a more
limited audience as a subscription-based cable station known as RCTV-Internacional.
99
“Venezuela: Legislative Assault on Free Speech, Civil Society,” Human Rights Watch, December 22, 2010; “Severe
Setbacks to Democratic Governance and Human Rights Guarantees in Venezuela,” Washington Office on Latin
America, January 19, 2011; and Ian James, “Ban On Foreign Funding Leave Venezuelan Activists in Limbo About
Whether They Are Targets,” Associated Press, January 30, 2011.
100
Joel Simon, “Chávez’s Decade of Media Repression,” Miami Herald, August 28, 2012; Committee to Protect
Journalists, Venezuela’s Private Media Wither Under Chávez Assault, August 2012, available at http://cpj.org/reports/
venezuela2012-english.pdf.

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In January 2010, however, the Venezuelan government took RCTV-Internacional off the air
(along with five other stations that were subsequently allowed to resume broadcasting). Many
observers believe that the government’s actions were taken to silence RCTV-Internacional, which
had continued to broadcast criticism of the Chávez government. The government maintains that
the stations violated the Law of Television and Radio Social Responsibility by not complying
with a requirement to broadcast government announcements and presidential speeches (which
have been numerous under President Chávez’s rule). International cable stations are not required
to comply with this broadcast requirement, but in December 2009, a decree by the National
Telecommunications Commission (CONATEL) maintained that cable stations would only be
considered international if 70% or more of their programming is foreign. This ultimately led to
the government taking RCTV-Internacional and the other five stations off the air on January 24,
2010.
There was widespread Venezuelan domestic and international criticism of the government’s
shutdown of the cable stations. OAS Special Rapporteur for Freedom of Expression Catalina
Botero and the Inter-American Commission on Human Rights’ Commissioner for Venezuelan
Affairs Paulo Sérgio Pinheiro expressed their strong opposition and requested that guarantees of
freedom of expression and due process be reestablished.101 Human rights organizations, including
Human Rights Watch, the Committee to Protect Journalists, Reporters without Borders, and the
Washington Office on Latin America, also strongly criticized Venezuela’s action.
Globovisión Case. The Venezuelan government also began targeting the operation of Globovisión
in 2009, a Caracas-area television news station that has often been critical of the government, and
has used administrative and criminal investigations against the station. In March 2010, the
president of Globovisión, Guillermo Zuloaga, was arrested for making remarks deemed offensive
to President Chávez at a meeting in Aruba of the Inter-American Press Association. After strong
domestic and international criticism, Zuloaga was released, but in June 2010, he fled the country
after another arrest warrant charged him with hoarding cars in an effort to capitalize on future
price increases at his car dealership. In October 2011, the Venezuelan government fined
Globovisión about $2.1 million for extensive coverage of a month-long standoff between
prisoners and government troops at a large prison outside Caracas. The government claimed that
the coverage had stirred public anxiety and included false accusations against the government. In
early March 2012, the Committee to Protect Journalists condemned an attack on Globovisión
journalists covering an opposition rally. The attack was allegedly conduct

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/crs%3AR40938. Public record. Not legal advice.