Unelected US-backed coup leader Juan Guaidó immediately moved to try to restructure Venezuela’s state-owned oil company and seek financing from the neoliberal IMF.
By Ben Norton
The right-wing opposition leader that the United States is trying to undemocratically install as Venezuela’s president immediately set his sights on the country’s state-owned oil company, which he is hoping to restructure and move toward privatization. He is also seeking money from the notorious International Monetary Fund (IMF) to fund his unelected government.
On January 23, US President Donald Trump recognized the little-known, US-educated opposition politician Juan Guaidó as the supposed “interim president” of Venezuela. Within 48 hours, Guaidó quickly tried to seize control of Venezuela’s major US-based oil refiner and use its revenue to help bankroll his US-backed coup regime.
Guaidó is attempting to fire the directors of Citgo Petroleum, which is owned by Venezuela’s state oil company PDVSA, and seeks to appoint his own new board.
Reuters described Citgo as “Venezuela’s most important foreign asset”; Bloomberg calls it “the crown jewel of PDVSA’s assets.”
Citgo is the largest purchaser of Venezuelan oil, although crippling sanctions imposed by the Trump administration have prevented the company from sending revenue to Venezuela, starving the government of funding.
Citing US officials, the Washington Post reported that the Trump administration’s strategy “is to use the newly declared interim government as a tool to deny Maduro the oil revenue from the United States that provides Venezuela virtually all of its incoming cash.”
Move Toward Privatizing Venezuela’s Oil
Venezuela has the world’s largest oil reserves. But leftist presidents Hugo Chávez and Nicolás Maduro have over the past two decades resisted attempts by US oil companies to exploit the South American nation’s plentiful natural resources.
The oil reporting agency S&P Global Platts reported that, in the immediate wake of the US anointing Juan Guaidó as Venezuela’s supposed “president,” the opposition leader already drafted “plans to introduce a new national hydrocarbons law that establishes flexible fiscal and contractual terms for projects adapted to oil prices and the oil investment cycle.”
This plan would involve the creation of a “new hydrocarbons agency” that would “offer bidding rounds for projects in natural gas and conventional, heavy and extra-heavy crude.”
In other words, these are rapid moves to privatize Venezuela’s oil and open the door for multinational corporations.
As The Grayzone previously reported, Venezuela’s right-wing opposition has already stated clearly in its “transition” plans: “Public companies will be subject to a restructuring process that ensures their efficient and transparent management, including through public-private agreements.”
S&P Global Platts also indicated that US sanctions are hitting Venezuela hard, and Trump administration officials could soon tighten the screws:
“… the US imposed sanctions that have severely hampered PDVSA’s ability to raise new financing or restructure its crushing debt load.
US officials said they are prepared to invoke further sanctions on Venezuela’s oil sector, including a full embargo on US imports of Venezuelan crude, if Maduro’s standoff with Guaido escalates in further violence or political crackdown.
Market sources said the US’ recognition of Guaido as the legitimate leader of Venezuela could prompt US refiners to stop purchases of Venezuelan crude while Maduro remains in power.”
The attempted restructuring of Citgo would just be the beginning of the neoliberal capitalist policies implemented by Venezuela’s US-backed coup regime.
Reuters also reported that Guaidó “is considering a request for funds from international institutions including the IMF to finance his interim government.”
The International Monetary Fund is notorious as a vehicle for US political and economic influence. For decades, the IMF, along with the World Bank, has trapped ostensibly independent Latin American nations in debt and imposed so-called “structural adjustment” programs that force governments to impose brutal neoliberal shock therapy on their populations, including austerity measures, privatization of state assets, deregulation, and gutting of social services.
Venezuela’s previous elected socialist president, Hugo Chávez, broke ties with the IMF and World Bank, which he noted were “dominated by US imperialism.” Instead Venezuela and other left-wing governments in Latin America worked together to co-found the Bank of the South, as a counterbalance to the IMF and World Bank.
Guaidó has moved to re-integrate Venezuela into these very same Washington-dominated financial institutions. In addition to seeking financing from the IMF, Guaidó is likewise trying to send a new representative to the Inter-American Development Bank.
Venezuela’s right-wing opposition has made it clear that it plans to pursue aggressive neoliberal capitalist reforms. The opposition-controlled National Assembly has also declared in its “transition” plans that the “centralized model of controls of the economy will be replaced by a model of freedom and market based on the right of each Venezuelan to work under the guarantees of property rights and freedom of enterprise.”
This plan might be a dream for foreign corporations, but even many Venezuelans marching against their government might soon decide that stripping state assets is not worth fighting for.