The rare move by the United States to place economic sanctions on Venezuela's President Nicolás Maduro will do little to reduce criminality within his regime and across his beleaguered country. The question is whether matters could get worse in criminal terms.
The US Treasury Department added Maduro to its list of "specially designated nationals" on July 31, thereby freezing all of his US assets and prohibiting American businesses from dealing with him. According to a Treasury Department press release, the action was taken under the authority of a 2015 presidential order, "which authorizes sanctions against current or former officials of the Government of Venezuela and others undermining democracy in Venezuela."
It is not clear what, if any, assets Maduro has in the United States. But the move does carry some symbolic impact, coming the day after Maduro claimed a sweeping victory in a controversial election to create a new constitutional assembly. The July 30 voting process was marred by violent clashes between demonstrators and authorities, as well as allegations of fraud on the part of the government.
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The new political body is expected to replace the current opposition-controlled National Assembly, and it is likely Maduro will use it to consolidate power even further as the regime faces down almost daily street protests that have been running since April, during which dozens have died.
"Yesterday's illegitimate elections confirm that Maduro is a dictator who disregards the will of the Venezuelan people," said US Treasury Secretary Steven Mnuchin said in a July 31 statement regarding the sanctions.
The new measures come less than a week after the administration of US President Donald Trump sanctioned 13 current and former Venezuelan officials for "undermining democracy." Among them was Interior Minister Nestor Reverol, who was appointed to his current position by Maduro the day after being indicted by the United States for allegedly participating in a transnational cocaine trafficking network. Venezuela's prisons chief Iris Varela, accused of overseeing the abdication of the penitenciary system to the control of its inmates, was also sanctioned last week.
It is unusual for the United States to target heads of state with economic sanctions. Maduro joins a short list of sanctioned leaders that includes the recently-deceased former dictator of Panama Manuel Noriega, Syrian President Bashar al-Assad, North Korea's Kim Jong Un, Zimbabwe's President Robert Mugabe and former Yugoslav President Slobodan Milosevic.
Hours after the sanctions against Maduro were announced, authorities reportedly rearrested Leopoldo López -- a prominent opposition leader who was recently moved from prison to house arrest after more than three years in a cell -- and Antonio Ledezma, another high-profile opposition voice.
InSight Crime Analysis
As InSight Crime pointed out last week, sanctions against top Venezuelan officials will likely serve to further isolate the regime, consolidating international pressure upon it and offering moral support to Venezuela's opposition. But they are unlikely to significantly weaken Maduro's grip on power, and could even prompt him and his allies to dig in further.
"Maduro will brush off the sanctions imposed by the US like one would brush off a pesky gnat," Mike Vigil, a retired Drug Enforcement Administration (DEA) agent with decades of experience in Latin America, told InSight Crime. "Venezuela, unfortunately, is now a failed state and narco regime."
Vigil and other international experts consulted by InSight Crime also expect this week's economic sanctions to have zero impact on Maduro's behaviour -- or at least none of the type of impact that the Trump administration might hope to see.
"Individual sanctions have never had an impact on the political or economic processes that would force or bring about changes on despotic regimes. Also, broader sanctions on Venezuela's oil-based economy would cause only more misery for the innocent citizens of Venezuela. The [latest sanctions] by the White House are nothing more than bluster," said Vigil.
Despite rumours that the United States is planning to slap sanctions on Venezuela's state-owned oil company Petróleos de Venezuela S.A. (PdVSA), those measures have not been announced. When asked during a press conference whether oil sanctions were a possibility, Mnuchin said the US government would "continue to review all of our options."
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Criminality within government ranks may be a motiviating factor behind the Maduro administration's rejection of the sanctions. Should Maduro and his allies be ousted, and should the opposition take over the executive branch, it is highly likely that criminal proceedings will be used to keep the Chavistas as far from power as possible. This gives the Maduro regime a strong incentive to try to maintain its grip, even if it involves extreme measures.
"The regime is already criminalized, and I'm not sure how much more criminalized it could become," Douglas Farah, president of national security consulting firm IBI Consultants, told InSight Crime.
Maduro's vice president Tareck El Aissami was sanctioned in early 2017 by the United States for his alleged ties to the drug trade, and more than a dozen current or former high-ranking officials have either been sanctioned or indicted for crimes related to drug trafficking. Maduro's own nephews were convicted in the United States in November 2016 for conspiring to traffic 800 kilograms of cocaine into US territory.
Pro-government groups in Caracas and around the country known as "colectivos" are also becoming increasingly criminalized and are now active in kidnapping, extortion and microtrafficking, according to field research by InSight Crime. The military, the regime's major pillar of support, is profiting from food and fuel trafficking as well as the international cocaine trade. Organized criminal networks control the country's prison system, and have given birth to a number of megabandas (large criminal gangs) on Venezuela's streets.
"With all the anarchy, with all the chaos spilling out into the street, that is going to be taken advantage of by the criminal groups there. It will definitely increase drug trafficking; I think you will see more and more Colombian organizations moving into Venezuela … and a lot of people will go into the drug trade because they have no option -- there’s no jobs, no money, no supplies," said Vigil.
Although Maduro and his inner circle all have a personal interest in maintaining the status quo due to the indictments and sanctions against them, Ralph Espach, director of Latin American and strategic affairs at the think tank CNA, thinks that ideology could still be a major motivator for key members of the regime.
"I wonder if maybe in Washington we are underestimating their ideological commitment. We like to describe them as crooks, and traffickers, and corrupt, not as ideological warriors (like the Castros) who are generally far more willing to allow the country to suffer, especially the former middle class/upper class and elites," said Espach via email.
"It could well be that they are thinking like Cuban revolutionaries, and are focused on sustaining the 'revolution,' even if it may last decades, and perfectly willing to contemplate the exodus of another million Venezuelans from the country or more, until oil prices go up again or they can get some special assistance from China or someone and ride this out."
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