Imperialism’s economic war costs Venezuela nearly $200 billion

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By Pasqualina Curcio

Quantifying each and every one of the effects of the war that imperialism has declared on the Venezuelan people is impossible. The attacks that Venezuelans have experienced since 1999 have not only been economic, they have also been psychological. There is no way to measure the consequences of the hatred that the undemocratic opposition has sown with its anti-socialist propaganda, to the point of burning people alive if they are suspected chavistas. The resentment that the Venezuelan people have towards those who claim to be Venezuelans, but who have sold out their homeland, is also unmeasurable.

That said, focusing on the economic dimension we have updated the calculations that we made in March 2019. At that point, losses caused by this war amounted to $125 billion; we have now calculated those for all of 2019, which total $68 billion (all amounts in US dollars).

Therefore, the total economic losses between 2016 and 2019 are $194 billion.

For Venezuelans, $194 billion is equivalent to approximately 16 months of national production. With that money, we could have paid the entire external debt of $110 billion. Or we would have enough resources to import food and medicine for 45 years.

These losses break down thus: $25 billion corresponds to money and assets that have been looted from us, while the other $169 billion represents what we have stopped producing from 2016 to 2019 as a result of the attack against state-owned oil and natural gas company PDVSA ($64 billion) and the attack on the bolivar ($105 billion).

Blockade, plunder and piracy

In January 2019 John Bolton confessed, “We froze all assets of the state-owned company PDVSA in US territory [CITGO]; we blocked US $7 billion in assets plus US $11 billion in estimated export earnings over the next year.”

According to the Ministry of Foreign Affairs, the US government and its allies have looted $25 billion from Venezuela. They disguise it as “sanctions” – others elegantly call them unilateral coercive measures – but it is nothing but blatant robbery and an act of piracy. Approximately $5.4 billion are held by 50 banks, including 31 tons of gold that the Bank of England has withheld from us. The $18 billion in assets and dividends of the CITGO company are also included.

They not only robbed us – in January 2019 the US State Department announced that it gave Juan Guaidó [self-declared president, against democratically elected President Nicolas Maduro] control of the assets, assets and properties of the Venezuelan government in US bank accounts, meaning he is responsible for the administration of these resources. We would like to know how much of this money has been allocated to protecting the Venezuelan population during the quarantine. We know that $200 million was used to seal the contract with SilverCorp, whose objective was to hire mercenaries to assassinate Venezuelans.

As for the retained gold, the Bank of England is obliged to return it to its owner immediately upon request. However, according to the English, the owner of the gold is Guaidó who they say is the “interim president” of Venezuela. This is a theft so outrageous that nobody in their right mind could accept it. The whole world knows it is not Guaidó who sits in the United Nations General Assembly, in the UN Human Rights Council, in the UN Security Council or in OPEC meetings. Obviously, he does not occupy the president’s seat in Miraflores Palace either, much less command the National Bolivarian Armed Forces.

Is it Guaidó who is dealing with COVID-19 in Venezuela and coordinating with the World Health Organization about health aid and protocols? These are key questions.

Attack on PDVSA

Former US ambassador to Venezuela William Brownfield acknowledged, “If we are going to sanction PDVSA, it will have an impact on the entire people, on the ordinary citizen. The counter argument is that the people suffer so much from lack of food, security, medicines, public health, that at this time perhaps the best resolution would be to accelerate the collapse even if it produces a period of suffering of months or perhaps years.”

The attack on PDVSA is not accidental; on the contrary, it is a deliberate and well-aimed action. Any disruption in the oil industry has repercussions on the company but also, and more fundamentally, throughout the national economy and on the Venezuelan people.

The oil industry generates 95 percent of Venezuela foreign currency revenue from exports. A decrease in these exports, either due to reduced oil production levels or a drop in price, affects the foreign currency revenue and, consequently, the imports of supplies, spare parts and machinery for national production. PDVSA is the catalyst for internal production.

For the first time ever, the price of oil fell for four consecutive years by a total of 65 percent. At the same time, due to the commercial and financial blockade against PDVSA, the difficulty of securing spare parts and supplies, financial restrictions and other reasons, oil production has decreased 64 percent, from 2.8 million barrels daily in 2013 to 1 million in 2019. Overall, this translates into a 78 percent drop in oil exports, which went from $85 billion annually in 2013 to $19 billion in 2019.

Between 2016 and 2019, Venezuela’s national production declined by $64 billion due to the decrease in oil exports.

Attack on the currency

US Republican senator Richard Black confessed about Venezuela, “We demonetized their currency and, through the international banking system, we made the Venezuelan currency worthless and then we go and say: ‘Look how bad this government is, your currency is worthless.’ Well, it wasn’t them, it was us who made their currency useless.”

The main weapon of the economic war is the attack on the bolivar [Venezuela’s currency], which not only produces hyperinflation and the consequent loss of purchasing power for the working class, but also contracts national production. Insofar as wage earners see their purchasing capacity deteriorate because of the rapid and disproportionate rise in prices, they decrease their demand for goods and production also decreases.

Since 2013 imperialism has criminally caused the depreciation of the bolivar by 241,657 million percent, which has led to a price increase of 11,500 million percent to date.

Between 2016 and 2019 Venezuela’s national production declined by $105 billion because of the attack on the bolivar.

Everyone can draw their own conclusions about what $194 billion in economic losses represent, in terms of anguish, outrage and quality of life for the Venezuelan people. But everyone should also draw conclusions about the immense level of consciousness and resistance of the Venezuelan people who, always with high morale, have confronted the enemies of their homeland with the best of strategies, the civic-military union.

Pasqualina Curcio is Professor of Economics at Universidad Simón Bolívar.

Article originally published at the author’s blog. Translated from Spanish by PV staff.

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