Weekly US intervention in Venezuela Monitor - October 18

Should we taxpayers pay for the trips and salaries of Venezuelan coup promoters?

By Michelle Ellner

On October 7, 2019, USAID Administrator Mark Green signed a “development objective agreement” with Juan Guaidó’s representative in the US, Carlos Vecchio, providing him and his team $98 million in “development assistance for Venezuelans inside Venezuela.”

USAID said that the funding will be destined for independent media, civil society, the health sector and the opposition-controlled National Assembly: “This new funding will build upon our existing support for local human rights defenders, civil society organizations, independent media, and electoral oversight.”

Subsequently, Elliot Abrams admitted that the money would also be used to pay salaries and airfare for “ambassadors” of Guaidó’s shadow government. In addition, according to a memo seen by the LA Times, USAID is redirecting funds originally meant for Central America to be used to pay for the salaries of the Guaidó “government,”  as well as airfares, “good governance” training, propaganda, technical assistance for holding elections and other “democracy-building” projects. In March, the U.S. government stated it would cut aid to Guatemala, Honduras and El Salvador after Trump expressed dissatisfaction with their immigration policies and said that they would not allocate any more aid until the number of migrants reaching the U.S. border is reduced. More recently, administration spokespeople announced that it was reversing its decision about aid to t the Central American governments. Where the $98 million for the Guaidó camp is coming from is therefore, unclear, this being another example of lack of transparency.

In August 2019 the US sanctioned CITGO, the Venezuelan State Oil Company PDVSA’s affiliate in the US by freezing its assets. Guaidó was recognized by Washington in January of that year, but was not given access to CITGO. To compensate for this, the US will pay the salaries of Guaidó government “officials,” a move that is necessitated by the fact that Guaidó has no fiscal power or any other power in Venezuela. The US (that is, us taxpayers) is paying for the mess the Trump administration created when it recognized the opposition leader. Paying the salaries of foreign government diplomats is largely unprecedented. Check out this petition to put a stop to USAID’s funding of Venezuelan politicians. https://www.codepink.org/usaid_venezuela

MARK GREEN: “The United States has provided $568 million in humanitarian and development assistance to those inside Venezuela and throughout the region. Those who have suffered at the hands of Maduro's brutality. The bilateral agreement we are signing today formalizes our partnership with Interim President Guaidó and his Administration. Theirs is the only government that represents the interests of the Venezuelan people, and we are very proud to work alongside them. With this new agreement, USAID commits to providing $98 million in development assistance for Venezuelans inside Venezuela. That includes a portion of the funding that I announced at the UN General Assembly and brings USAID's total development assistance for the dire situation in the country to approximately $116 million.”

Software’s Overcompliance

Many software companies are closing operations in Venezuela. Adobe, Oracle, Flickr, TransferWise and others informed Venezuelan users that they would end services due to E.O. 13884 (Blocking Property of the Government of Venezuela). This is a perfect example of what is referred to as “overcompliance” in that the sanctions are supposed to target the Venezuelan government and not ordinary Venezuelans.

Opposition figures are petitioning those companies to maintain their operations in Venezuela. The target of the sanctions is supposedly the Maduro government, but the Venezuelan state, by law, is obliged to use Free Software. In fact, it is the middle class that is really being adversely affected. In this article for CODEPINK, Leonardo Flores points out that the services of these companies are mostly used by freelancers in Venezuela in order to work remotely with foreign companies and earn dollars in the face of the nation’s pressing economic difficulties. He concludes that this decision by software companies will only harm ordinary Venezuelans and will force many of them to emigrate.

Venezuela at the UNHRC

On October 17, 2019, the UN General Assembly elected 14 new members of the 47-country Human Rights Council for a three-year term beginning in January 2020. The United States, even though it withdrew from the HRC, undertook a full-fledged campaign to block Venezuela’s bid to obtain a seat on the council. In a clear attempt to prevent Venezuela’s victory,  Costa Rica announced its candidacy earlier this month, explicitly AGAINST Venezuela, with the full support of the United States. The questionable human rights credentials of other candidates such as Brazil, Libya or Poland, apparently were of no concern for the United States.

In an op-ed published in the Miami Herald, former US ambassador to the UN Nikki Haley called on members of the U.N. General Assembly to block Venezuela from a spot on the Human Rights Council. "Venezuela is the last country that should sit on a council that’s supposed to protect human rights and yet, because of the corrupt rules for membership in the HRC, the Maduro regime has a real chance of winning." Before Costa Rica mounted a bid for the HRC, Venezuela was one of two Latin American countries running for the region's two allotted spots in this week's election, essentially guaranteeing it a seat.

Michael G. Kozak’s Tweet: @WHAAsstSecty: The illegitimate Maduro regime, with its abhorrent #humanrights abuse record, has no place on the @UN_HRC. Say no to #Venezuela's bid for the @UN_HRC. https://twitter.com/WHAAsstSecty/status/1184441122514505728?s=08

@StateDept: The illegal Maduro regime in #Venezuela is seeking a seat on the UN Human Rights Council. The United States does not support the illegal Maduro regime’s attempt to obtain a seat on the @UN_HRC  #EstamosUnidosVE. https://twitter.com/StateDept/status/1184522060200140801?s=08

Venezuela won the seat on the HRC with 105 votes. Costa Rica announced its candidacy only 10 days before the actual election, but an all-out effort was made to win the seat. At the end, it backfired. This contest was not about human rights, the vote was really about anti-imperialism and foreign intervention in the internal affairs of nations. The secrecy of the vote facilitated Venezuela’s victory as it limited the effectiveness of U.S. coercion and bribery. Remember in 2017 former Ambassador to the U.N. Nikki Haley said that the U.S. would be “taking names” of countries that vote against U.S. interests, while Trump warned that the administration was watching votes -- specifically from those that take U.S. money. This election was a good test and proof that the US is further isolating itself at the UN General Assembly. If the election was about the legitimacy of the Maduro government, Venezuela would have won with a large majority.  The UN is out of sync with U.S. interests in more than two-thirds of the issues that are submitted to a vote. According to a report published by the State Department (https://www.state.gov/voting-practices-in-the-united-nations/) the U.S. and the U.N. General Assembly as a  whole were in alignment only 31 percent of the time in 2018.

State Department’s reactions:

MICHAEL R. POMPEO, SECRETARY OF STATE

“The UN High Commissioner report on Human Rights issued this past July documented egregious human rights abuses of the former Maduro regime in Venezuela.  It is sadly no surprise that Maduro shamelessly sought a seat on the UN Human Rights Council in an effort to block any limit to his repressive control of the Venezuelan people.  What is truly tragic, however, is that other nations voted to give Maduro’s representative for Venezuela a seat on the UN Human Rights Council. This is a harsh blow not just against the victims of the Venezuelan regime, but also against the cause of human rights around the world.  (…) Its membership includes authoritarian governments with unambiguous and abhorrent human rights records, such as China, Cuba, and Venezuela. These are among the reasons why the United States withdrew from the Human Rights Council in 2018. (…) The United States strongly supports multilateral organizations that sincerely and effectively work to protect human rights.  The election to the Human Rights Council of Maduro’s representative is a farce that further undermines the Council’s already frail credibility.”

MORGAN ORTAGUS: @statedeptspox. “Outrageous to see another #humanrights abuser like #Maduro voted onto @UN_HRC The Human Rights Council should speak out about the abuses of the illegitimate Maduro regime and others like it, not provide them a platform to justify their repression.” #EstamosUnidosVE

US AMBASSADOR TO THE UN KELLY CRAFT called the election "a tragedy for the people of Venezuela" and said it was "utterly appalling" that the country with "one of the world's worst human-rights abusers" should be granted a seat on a council that is meant to defend human rights. 

Vultures around CITGO

CITGO, the American subsidiary of the Venezuelan national oil company, PDVSA, is the object of international political scheming, legal maneuvering and a fight over who gets the juicy part of the business. According to Bloomberg, Ashmore Group owns 51.01 percent of PDVSA bonds due to mature in 2020. If the Guaidó-appointed ad hoc CITGO board fails to make good on the payment by October 28, Ashmore could initiate proceedings for CITGO shares to be auctioned off to the highest bidder.

After the U.S. government recognized the president of Venezuela’s National Assembly, Juan Guaidó, as the legitimate interim president of Venezuela, U.S. courts allowed a board appointed by the Guaidó administration to take control of Citgo. Trump’s Administration then froze US accounts belonging to the country’s state oil company (PDVSA). Guaidó officials defended the measure on grounds that it was necessary to protect the company from the Maduro government.

Maduro’s creditors may be able to seize Citgo under General License 5 (a sanctions exemption issued by the U.S. Department of Treasury). Sanctions imposed on Venezuela forbid any U.S.-based transaction involving Venezuelan assets, but General License 5 gave the PDVSA 2020 bondholders a special exemption. This exemption established before Guaidó took over control of Citgo was intended to maximize financial pressure on Maduro, but if these creditors get their way, it may have a very different effect, namely allowing creditors to take over the assets of Guaidó’s CITGO .

Recently, Guaidó declared void the 2020 PDVSA bonds arguing that they are illegal on grounds they were issued without the permission of the opposition-controlled parliament. Guaidó is reportedly seeking to have the bonds annulled in US courts. His intention is to block the ability of those creditors to seize control of CITGO assets.

What an incredible mess! This entire imbroglio was created by the U.S. government. Venezuela never failed to pay for its bonds until the US started sanctioning the country and then turned CITGO over to Guaidó and company. Ironically, losing CITGO will not only be bad for Guaidó, it would be terrible for the Venezuelan people.

Statements about Venezuela:

INTERNATIONAL MONETARY FUND MANAGING DIRECTOR KRISTALINA GEORGIEVA “We, obviously, have been following very closely the developments in Latin America. The whole region slowed down more than the rest of the world. So, what we are seeing everywhere we see even more in most of Latin America for different reasons in different countries. Colombia is a case when there is exiguous factor and that is the crisis in Venezuela. Colombia is not the only country that has been receiving refugees from Venezuela. But, is the country where the number of these refugees is the largest. To a certain degree, that has been helpful to the economy of Colombia because these are educated, qualified people. They boost the labor market in Columbia. But, in the numbers of their arrivals this, of course, is a very heavy burden on Colombia. (…) good portion of the increased growth in 2020 comes because we have the presumption that a number of a very troubled economies that fell sharply this year, Iran, Venezuela, Argentina, Turkey, will not decline again. And that's actually the largest contributor to this. Now, there--we don't know that that will happen. That's prospect makes this a precarious forecast.

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