Tag Archives: venezuala

Tom Arms’ World Review

Venezuela

Venezuela is not—repeat, NOT—a major drug producing country. That is according to the US Drug Enforcement Agency (DEA) and the UN Office on Drugs and Crime (UNODC).

It is not even a major transit country. That honour is reserved for Mexico and Central America which provide the major transport routes from production centres in Colombia, Bolivia and Peru.

Some cocaine is transited to the US through Venezuela but most of the drugs that passing through the South American country are bound for Europe, according to the DEA and UNDOC.

Then why, you may ask, has President Trump and his sidekick Pete Hegseth, blown up boats (allegedly carrying drugs)  coming mainly from Venezuela. So far 87 people have died in these legally suspect attacks. Why also, is a major US naval force led by the world’s largest aircraft carrier (the USS Gerald Ford) parked off the coast of Venezuela with the obvious intent of threatening regime change?

The answer is OIL.

Venezuela has the world’s largest proven oil reserves—330 billion barrels compared to 260 billion in Saudi Arabia, the world’s second largest.

But the oil is staying in the ground. It wasn’t always that way. In its production heyday, Venezuela was extracting 3.5 million barrels of oil a day. Current production is up significantly from a year ago but is still only 921,000 barrels a day.

This is because the state-owned oil company Petroleos de Venezuela (PDVSA) is corrupt and inefficient. It has not maintained either the oil wells, the pipelines that carry the oil from the Orinoco Basin to coastal shipment centres or the storage depots or ships.

One of the reasons for the inefficiency is that roughly a quarter of Venezuela’s population has fled the oppressive regime of Nicolas Maduro. A large proportion of those refugees are the skilled workers needed to toil in the oil industry.

If Maduro is removed from power—as Donald Trump would dearly love to see—then the Opposition has said that it would privatise the Venezuelan oil industry and invite foreign companies to take over production. In fact, Opposition leader—and Nobel Peace Prize winner—Marina Corina Machado—met with oil companies last April to discuss how they could revive her country’s oil fortunes.

Most of those companies would be American and the exploitation of Venezuela’s heavy crude by American oil companies would be a good fit with Donald Trump’s foreign policy aims.

Honduras

Trump’s policies are nothing if not inconsistent. On the one hand he says he is at war with drug traffickers and his declaration of war justifies blowing up boats without legal due process.

On the other hand, he pardons the former President of Honduras—Juan Orlando Hernandez—who was sentenced to 45 years in prison for drug trafficking.

Hernandez served two terms as president from 2013 to 2021. While in office he was popular with both Barack Obama and Trump. Obama described him as one of “the excellent partners” on the migrant children crisis and Trump endorsed Hernandez when he ran for re-election in 2017.

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Observations of an expat: Latin Fandango

South America is in a mess. The problems stretch from Patagonia to Cartagena and further north into Central America and Mexico.

Almost everywhere there is violence, political instability and economic problems.

The main spotlight has been shone on Brazil. The Portuguese-speaking nation is the economic giant of South America. Its GDP is four times the next largest Latin economy and the eighth largest in the world. Brazil has tremendous potential and political problems.

It is deeply divided after left-winger Luiz Inacio da Silva (aka Lula) narrowly defeated right-wing populist Jair Bolsonaro in October elections.

Bolsonaro and his supporters has claimed the elections were rigged and demanded a re-run. Thousands of Bolsonaristas (as they are called) stormed government offices in the capital Brasilia including Congress, the Supreme Court and the presidential palace. 1,200 have been arrested.

But the real problem is not the validity of the elections but the deep divide between Brazil’s political left and right. Conservatives, which include the military, police, middle classes and growing Christian evangelical movement, view Lula as a crypto-communist set on destroying Brazilian democracy and taking their country down the path of Cuba or Venezuela. Bolsonaro’s opponents worry that he will return Brazil to a military dictatorship.

To the south, Argentina is suffering another bout of Peronism and a division at the top of the country’s political structure. President Alberto Fernandez and Vice-President Cristina Fernandez de Kirchner simply don’t speak to each other. On top of that, Ms Kirchner has been convicted of fraud totalling $1 billion.

The resultant political vacuum and distractions at the top of the Argentine political tree, coupled with Peronism’s irresponsible spending has left the country with a crippling debt and 100 percent inflation rate. Thirty-seven percent of the country live below the poverty line.

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