VENEZUELA: POLITICAL REFORM OR REGIME DEMISE? Latin America Report N°27 – 23 July 2008 TABLE OF CONTENTS EXECUTIVE SUMMARY AND RECOMMENDATIONS................................................. i I. INTRODUCTION ............................................................................................................. 1 II. 2007: SEEKING CONSTITUTIONAL REFORM AND REGIME CONSOLIDATION........................................................................................................... 2 A. ACCELERATING THE REVOLUTION ................................................................................................2 B. THE CONSTITUTIONAL REFORM....................................................................................................3 C. WANING SUPPORT ........................................................................................................................4 1. Political context ......................................................................................................................4 2. Socio-economic and public security problems.......................................................................7 D. INTERNATIONAL CONTEXT ...........................................................................................................9 E. THE DECEMBER 2007 REFERENDUM...........................................................................................11 III. 2008: THE BEGINNING OF THE END FOR CHAVEZ?......................................... 13 A. IS POLITICAL REFORM STILL POSSIBLE? .....................................................................................13 B. THE POLITICAL FORCES ..............................................................................................................14 1. The pro-Chávez camp...........................................................................................................14 2. The opposition ......................................................................................................................16 3. The potential for violence in the run-up to the November polls...........................................18 C. THE SOCIAL AND INTERNATIONAL SITUATION ............................................................................20 1. The socio-economic time bomb ...........................................................................................20 2. International arena for the “socialism of the XXIst century”...............................................23 IV. CONCLUSION................................................................................................................ 28 APPENDICES A. MAP OF VENEZUELA........................................................................................................................29 B. CONSTITUTIONAL REFORM REFERENDUM RESULTS.........................................................................30 C. ABOUT THE INTERNATIONAL CRISIS GROUP ....................................................................................31 D. CRISIS GROUP REPORTS AND BRIEFINGS ON LATIN AMERICA AND THE CARIBBEAN........................32 E. CRISIS GROUP BOARD OF TRUSTEES................................................................................................33 Latin America Report N°27 23 July 2008 VENEZUELA: POLITICAL REFORM OR REGIME DEMISE? EXECUTIVE SUMMARY AND RECOMMENDATIONS President Hugo Chávez faces mounting difficulties at not empowered citizens. In the cities and even in rural home and abroad. The defeat of constitutional reforms areas, where Chávez’s social base has been strongest, in a December 2007 referendum, a year after re-election, dissatisfaction is spreading due to shortages of basic was his worst setback since winning the presidency in foodstuffs and rising inflation and crime. The PSUV, 1998. It was not primarily the divided opposition, established in early 2007, is unlikely to help Chávez which lacks a broad social base, that dealt this blow regain lost support. On the contrary, at the grassroots but the abstention of three million Venezuelans, in- and regional (state) and local (municipalities) levels, cluding many former government supporters. There is it is perceived as a top-down decision-making struc- growing disenchantment over food shortages, rising ture that reduces any space for political participation inflation, public insecurity and corruption, as well as not blessed by the president. resistance to Chávez’s push to merge his coalition’s parties into a new United Socialist Party of Venezuela The November elections will be a critical test for the (PSUV), and concern about further concentration of Chávez administration and democratic processes in power in the president’s hands and his foreign policy, the hemisphere. If the political opposition is to make including disputes with Colombia. Only by ending broad gains and capture several chavista fiefdoms, it attempts to drastically alter the 1999 constitution is must breathe life into the unity pact signed in early Chávez likely to return Venezuela to democratic sta- 2008, reach consensus on strong single candidates, bility. If he fails to compromise and govern more attract the under-privileged sectors of the electorate transparently and inclusively, November municipal and design a convincing national strategy capable of and regional elections could produce a dramatic new offsetting Chávez’s charisma. setback for his increasingly autocratic “Bolivarian revolution”. RECOMMENDATIONS Following his landslide second re-election in Decem- ber 2006, Chávez sought to accelerate implementation To the Government and State Institutions of his “socialism of the XXIst century”. The govern- of Venezuela: ment-controlled National Assembly (NA) passed an “Enabling Law” (Ley Habilitante), which grants him 1. Focus on applying the 1999 constitution and act full legislative powers until the end of July 2008, and immediately to improve public sector accountabil- he proposed sweeping reform of the 1999 constitu- ity and transparency by: tion. If approved in the referendum, the latter would (a) establishing a high-level, civilian-led national have removed limitations on presidential re-election commission to design a public security strategy as well as paved the way for centralised education; to fight crime; members of the commission further politicisation of the military; recentralisation should include representatives of the interior of government through a new territorial and political and defence ministries, the National Assem- order; and strengthening of communal councils charged bly, the attorney general’s and ombudsman’s with administering the executive-led social welfare offices, a multiparty group from state govern- programs (misiones). Attempts to impose decrees with- ments and mayoral offices, national, regional out broad discussion in the first half of 2008 sparked and local law enforcement agencies and civil strong dissent that forced their withdrawal. society; The chavista movement is losing momentum. It has (b) ensuring that any revision to the withdrawn become bureaucratic, corruption is spreading and the intelligence decree is consulted widely with government’s management is poor. The president’s civil society, the Inter-American Institute for social programs are not meeting expectations and have Human Rights and the Inter-American Com- Venezuela: Political Reform or Regime Demise? Crisis Group Latin America Report N°27, 23 July 2008 Page ii mission on Human Rights to ensure that it does and, in accordance with the 17 March 2008 not contain provisions violating the 1999 con- OAS resolution, reinforcing border coopera- stitution or internationally recognised covenants tion to prevent the use of sanctuaries by illegal protecting civil liberties to which Venezuela armed groups; is a signatory; (b) sending a clear message of non-interference in (c) creating with the leadership of the comptrol- any way with other countries’ constitutional ler’s office and the support of the attorney and political processes; and general’s office, the prosecutor general’s office (c) continuing economic and technical assistance (procuraduría) and the National Assembly a programs in Latin America and the Caribbean team of special prosecutors to conduct fair in close coordination with the partner govern- and independent investigations of charges of ments, prioritising development goals without government corruption; political conditions. (d) alleviating food shortages by spurring domestic production, increasing support to small farm- To the pro-Chávez Political Parties and ers and giving investment guarantees to national Social Movements/Organisations: and foreign investors in agriculture; and 4. Defend the 1999 constitution and Venezuela’s (e) integrating the social missions with existing democracy more actively by promoting, in and public welfare programs and establishing effec- outside the National Assembly, accountability, tive and independent monitoring and evalua- transparency and the separation of powers. tion mechanisms for them. 5. The United Socialist Party of Venezuela (PSUV) 2. Establish guarantees for transparent conduct of the should establish a dialogue with the other mem- November 2008 municipal and federal state elec- bers of the Patriotic Alliance regarding the fair tions and respect of basic civil and political liber- and transparent selection of single pro-Chávez ties enshrined in the 1999 constitution by: candidates for state and municipal offices in the (a) demonstrating in word and deed that violence