So, President Hugo Chávez has been re-elected with a healthy 55 percent of the popular vote, though by a slimmer margin of victory than in the 2006 election – 10 percentage points as opposed to 26. The vanquished Henrique Capriles and his coalition of opposition parties, understandably distraught at the result in light of their pre-election optimism, have accepted the loss although there is considerable grumbling about the huge advantages enjoyed by the incumbent and the high degree of “induced” voting.
Apparently, with some 80 percent of the population voting, the number of people declining to exercise their franchise was smaller than calculated by the opposition’s strategists and than estimated by pollsters who had allowed for a 25 percent abstention. It will be recalled that in the December 2007 referendum, which Mr Chávez lost, there was a 44 percent abstention rate.
What the opposition is arguing, as it had been pointing out in the lead-up to the election, is that the government, with the resources of the state at its disposal, had the greater capacity to mobilise support. By so doing, the chavistas were able to nullify the possible loss of votes through abstention.
Nevertheless, with their sights now set on the gubernatorial elections in December, Mr Capriles and the opposition will be seeking to evaluate what gains they made in chavista strongholds, especially as they believe that the gap between them and Mr Chávez will continue to narrow.
Most importantly, the spectre of civil turmoil – especially if Mr Capriles had prevailed – has been laid to rest, for now. In addition, the fears among Mr Chávez’s supporters across Latin America and the Caribbean that he might lose, amidst grim scenarios of the demise of the Bolivarian Alliance for the Americas (ALBA), Petrocaribe and his petrodollar handouts, have been dispelled.
Here in Guyana, the effusive tone of President Donald Ramotar’s congratulatory message to his Venezuelan counterpart would even seem to suggest a certain amount of relief and the expectation that the status quo ante regarding the bilateral relationship would continue. Presumably, the Takuba Lodge foreign policy brains trust is now cheerfully putting away whatever contingency plans they might have prepared in the event of a win for Mr Capriles.
But there is no room for complacency, either among chavistas in Venezuela or among Mr Chávez’s allies in the region. Our editorial last Sunday has already dealt with the uncertainty surrounding the state of the president’s health. Now, as he embarks on the next phase of his ‘Bolivarian’ socialist revolution, doubts about its economic sustainability and the implications for his foreign policy persist.
The Venezuelan economy is structurally unsound. As his many critics have indicated, Mr Chávez and his government have totally mismanaged the economy, undermining its productive base and making it even more dependent on oil, the high price of which has enabled Mr Chávez to underwrite his domestic social programmes and his foreign largesse. But investment is down, inflation is up, basic goods are in short supply, public infrastructure is crumbling and, added to the deteriorating security situation, the management class continues to seek greener pastures overseas.
This is the assessment of The Economist: “Despite strong oil-fuelled growth this year, the country’s foreign-currency reserves are dwindling, thanks to profligate spending (not least on the election), a rising debt burden and dependency on a single commodity for export earnings and government income. Most analysts believe a big devaluation is inevitable, given an inflation rate of close to 20% and a black-market exchange rate almost three times as high as the official one.”
It is not a recipe for sustainability but, of course, Mr Chávez and Venezuela are still sitting on top of the world’s largest petroleum reserves. The president will therefore be banking on PDVSA, the state oil company beset by management and production woes, to continue pumping oil to keep his social programmes alive. If, however, the price of oil drops significantly below US$100 per barrel for a prolonged period, the inherent vulnerability of the Venezuelan economy will be further exposed and the flow of petrodollars to Venezuela’s Latin American and Caribbean friends may well begin to dry up. Even Mr Chávez must know that complete victory is not yet assured.
