Venezuelan President Nicolas Maduro extended the economic state of emergency in the South American country on Saturday by 60 days. The president also threatened to take over idle factories and jail their owners who are trying to "sabotage the country" by halting production.
The emergency state extension came after pro and anti-government demonstrators took to the streets, in response to the economic crisis that has been gripping the country since January. Clashes erupted last week between security forces and demonstrators protesting against food shortages, power blackouts and the government’s stalemate. A public health crisis has ensued and the situation has already claimed the lives of many Venezuelans.
The opposition party in Caracas has gathered 1.8 million signatures on a petition to force a recall referendum. The signatures have been questioned for their validity, however, by the current government and election authorities have declined to verify the petition which is the next required step in the process.
Oil the Culprit?
Analysts believe that the root of the problem is Venezuela’s socialist model introduced by Hugo Chavez in the late 1990s which was based on one factor only—high oil prices. When prices dropped, the populist spending could not be sustained by his successor, triple digits inflation hit and the economy collapsed.
According to senior US intelligence officials, there is little chance that President Maduro will be able to complete his term which ends in late 2018 and that Venezuela may be headed towards an all-out uprising that could lead to the overthrow of its Government as early as this year. With the country experiencing shortages it will probably also default on its international debt.
US policymakers think there is little they can now do to change the rapidly-deteriorating situation and they are taking a wait and see approach. The main US concern is that a major Latin American country does not collapse.