Archive for December 7th, 2015

Long And Winding Road For Change In Venezuela After Sweeping Opposition Victory

December 7, 2015

road

I have been waiting for the CNE to give a new bulletin of yesterday’s results, but so far no luck in obtaining a complete set of numbers for what happened last night. Remarkably, the number of Deputies for the opposition keeps increasing, with the latest estimate between 117 and 118 Deputies. The opposition did publish earlier a list of the 112 Deputies that will surely be announced as winners up to now.

This is truly in the upper range of any expectations, as voters clearly expressed their disenchantment with the Bolivarian revolution¬† and the current state of the Venezuelan economy. Maduro was not that gracious or wise in accepting the defeat, devoting most of his time to blaming the “economic war” for the defeat and not the economic stupidity of his Government’s policies. Never had the phrase “It’s the Economy Stupid” resonate more than today in Venezuela.

And while the opposition has to rejoice in its victory, it will be a long and winding road to obtain the change the people want, particularly on economic matters. It will also be a conflictive route to change, as Chavismo will certainly resist the possible dismounting of the Bolivaraian State.

And the opposition has to understand its victory for what it is. People turned against the Government, but the sweeping victory is a strong rejection of Chavismo, more than a strong support for the opposition. And the strong mandate calls for action, but it is precisely on Economic matters that it is more difficult for the Venezuelan National Assembly to have an impact.

But at the same time, the 2/3 majority gives the opposition many powerful tools to at least negotiate with Chavismo, including removing and naming members of the Electoral Board, Supreme Courts and all other major public powers, approval of Constitutional reforms, issue organic laws, name Permanent commissions of the National Assembly and approve and propose referenda, including revoking the Presidency after its third year of mandate.

But all and any of the above implies conflict, decisions and optimizing time and resources in order not to waste time in pyrrhic fights with little immediate positive consequences.

How the weakened Maduro Government reacts will be key in the process. So far, Maduro seems to have been too defensive in the reaction to the loss. His mandate has been severely weakened in the eyes of his own supporters, party and national opinion and there is little he can do for maintaining the status quo. But at the same time, he will have a hard time implementing an economic change that he has clearly not agreed with in the past. Internal fighting and bickering within Chavismo must be intense and it is clear that Maduro will have to assume all of the blame for the blow received by Chavismo on Dec. 6th.

Venezuela and PDVSA bonds jumped on the news, but they simply recovered back to the prices of a week ago, a clear signal by the market that it is concerned about the future. However, the mandate received by the opposition should in general be more supportive for prices, even in the face of US$ 38 oil today.

It will also be important for the opposition to maintain its cohesiveness. Difficult decisions are coming such as who should be named President of the National assembly come Jan. 5th. when the Assembly is sworn in and the priority in the legislative actions that the opposition will undertake with its super majority.

A difficult and somewhat daunting task ahead, but a much brighter prospect for a country ruled autocratically and by whim for too many years.

 

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