{"id":6929,"date":"2018-09-25T08:00:45","date_gmt":"2018-09-25T12:00:45","guid":{"rendered":"http:\/\/thediplomaticenvoy.com\/?p=6929"},"modified":"2019-04-01T16:47:33","modified_gmt":"2019-04-01T20:47:33","slug":"maduro-scrambles-to-find-solutions-to-venezuelan-economic-crisis","status":"publish","type":"post","link":"https:\/\/blogs.shu.edu\/thediplomaticenvoy\/2018\/09\/25\/maduro-scrambles-to-find-solutions-to-venezuelan-economic-crisis\/","title":{"rendered":"Maduro Scrambles to Find Solutions to Venezuelan Economic Crisis"},"content":{"rendered":"

By Axel Sontgerath
\n<\/strong>Staff Writer<\/em><\/strong><\/p>\n

\u201cI already told my four employees to go find other jobs,\u201d said Marcos Vizcaino, age 55, \u201cI\u2019ve decided to close. There\u2019s no need for me to keep to losing money for a third year in a row.\u201d The car garage owner in Venezuela\u2019s capital of Caracas felt he had no other choice, Bloomberg News<\/a> reports, the economic crisis has forced him to shut down his family business.<\/p>\n

Vizcaino\u2019s decision to shut down his business came from the effects of Venezuelan President Nicolas Maduro\u2019s recent economic policy, which has raised the minimum wage in the country by 3000 percent. Put into action on September 17, 2018, 1,800 bolivars, equivalent to about $20, were guaranteed to 7 million employees throughout Venezuela per month, per Bloomberg News<\/a>. Intended as a political boost, the raise instead forced companies to tell workers they cannot afford to keep them.<\/p>\n

This is just the latest policy in a four-year long economic struggle for Venezuela. According to the International Monetary Fund<\/a> (IMF), the nation\u2019s inflation rate is expected to reach one million percent this year.<\/p>\n

The crisis began after a 2014 crash in the price of oil. In August 2018, oil production dropped to just 1.4 million barrels per day, from a record high of 3.2 million 10 years ago. According to Al Jazeera<\/a>, this drop is a 30-year low in the country\u2019s oil production history, as oil production accounts for 96 percent of Venezuela\u2019s revenue.<\/p>\n

Citizens have experienced food and medicine shortages, in addition to social services, such as electricity, water and transport are failing due to the lack of government funds. These critical hits to the nation\u2019s infrastructure has Venezuelans leaving by the millions to neighboring countries, with 1.6 million people having been forced to flee since 2015, the United Nations reports, according to Al Jazeera<\/a>.<\/p>\n

In an interview with the Miami Herald<\/a>, Meganalisis Vice President Ruben Chrino Lea\u00f1ez said, \u201cthe government\u2019s inability to provide basic necessities has opened the doors to options that would have been unthinkable just a few years ago.\u201d<\/p>\n

On Monday, Meganalisis<\/a> conducted a poll that found 84.3 percent of those surveyed would favor a multinational \u201cintervention\u201d if it brought large amounts of food and medicine to the country. Another 20.5 percent, the equivalent of 6 million people, say they will leave Venezuela if Maduro remains in power and the economic situation does not change.<\/p>\n

According to the Miami Herald<\/a>, Maduro spent the weekend of September 15 trying to secure a $5 billion dollar emergency loan from China. In a public statement, per Reuters<\/a>, Venezuela\u2019s government sold a 9.9 percent stake in the joint-oil investment venture between the two nations, Sinovensa, of which China already holds a 40 percent stake in. The statement also outlined a new \u201cmemorandum\u201d, which was signed by both China and Venezuela, \u201cfor cooperation in Ayacucho bloc 6.\u201d\u00a0 This area is located in the oil-rich Orinoco Belt, where China will drill 300 wells and extend $184 million in financing.<\/p>\n

According to an anonymous source from Reuters<\/a>, China will handle all oil services and procurement in the region. Venezuela\u2019s finance ministry stated in July that it would receive $250 million from China Development Bank to boost oil production. In addition, Venezuela has previously accepted a $5 billion dollar loan from China, with the full amount yet to be received.<\/p>\n

Another strategy the Venezuelan president has adopted is suing his neighbors, claiming xenophobic treatment of Venezuelan migrants and previous aid to Colombian refugees as grounds for a lawsuit, the Miami Herald<\/a> reported. Maduro has been targeting Colombia, but keeping his sights on Peru and Ecuador as well.<\/p>\n

Speaking at a youth rally for the ruling United Socialist Party of Venezuela, Maduro claims he spends millions on social services for Colombians living in Venezuela, and that Colombians are luring away Venezuelans away from the country to destabilize his administration. The Venezuelan Observatory, a think-tank at Colombia\u2019s Rosario University, has stated there were never more than 3.6 million Colombians in Venezuela, which includes Venezuelan-born children.<\/p>\n

Venezuela\u2019s neighbors are unbothered by this lawsuit. Colombia reiterated this week that it \u201cwould not assign an ambassador to Venezuela until the country becomes a democracy again.\u201d Ecuador\u2019s Foreign Minister, Jos\u00e9 Valencia, said there was \u201cno basis\u201d for Venezuela\u2019s legal threats. \u201cWhat Ecuador has done, and the world is our witness, is work, collaborate and give everything of itself,\u201d Valencia told Ecuavisa television, \u201cincluding during this period of financial austerity that we\u2019re going through, Ecuador has opened its arms.\u201d<\/p>\n

The effects of the economic crisis in Venezuela have burdened it\u2019s people, destroying the society and infrastructure of the once-rich South American nation. As Maduro attempts to hide behind scapegoats and flash loans from China, the Venezuelan people suffer. Marcos Vizcaino, the car garage owner from Caracas, now has no business and no place to go.<\/p>\n","protected":false},"excerpt":{"rendered":"

Vizcaino\u2019s decision to shut down his business came from the effects of Venezuelan President Nicolas Maduro\u2019s recent economic policy, which has raised the minimum wage in the country by 3000 percent. <\/p>\n","protected":false},"author":4228,"featured_media":6930,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"colormag_page_container_layout":"default_layout","colormag_page_sidebar_layout":"default_layout","_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[1468,382,384],"tags":[477,1452,1459],"class_list":["post-6929","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-september-2018","category-international-news","category-americas","tag-venezuela","tag-economic-crisis","tag-1459"],"yoast_head":"\nMaduro Scrambles to Find Solutions to Venezuelan Economic Crisis - 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