Girish Gupta

HOME

PHOTOS

VENEZUELA ECON

ONLINE

Twitter
Instagram
Facebook
LinkedIn
AngelList
Keybase
GitHub
IFTTT

BY COUNTRY

Brazil
Colombia
Cuba
Ecuador
Egypt
Guyana
Iraq
Jordan
Lebanon
Mexico
United Kingdom
Venezuela

BY MEDIUM

Text
Photo
Radio
TV/Video

BY PUBLISHER

Al Jazeera
BBC
BuzzFeed
CBC
Christian Science Monitor
CNN
Daily Mail
Datum
Ecologist
Economist Intelligence Unit
Emerging Markets
Financial Times
Foreign Policy
France 24
Fusion
GlobalPost
Guardian
Independent
La Prensa (Panama)
LatinFinance
Mancunion
Monocle
National (Abu Dhabi)
New Internationalist
New Statesman
New York Times
New Yorker
NPR
PBS
PRI
Radio France Internationale
Reuters
RTE
Sky News
Sun
Sunday Times
Telegraph
TIME
Times of London
USA Today
Vice
WLRN

ABOUT

About
CV
Contact (PGP Key)
Venezuela's role in warming Cuba - US relations
Dec. 17, 2014 — Caracas, Venezuela

Published by Christian Science Monitor

A lot of people have been getting credit for the US-Cuba breakthrough today, from Raul Castro and Barack Obama to Pope Francis and Canadian Prime Minister Stephen Harper.

But there's someone else who deserves credit for taking Cuban-US diplomatic relations to the brink of normalization, though he probably doesn't want it: Venezuelan President Nicolás Maduro.

In the late 1990s, President Maduro's predecessor Hugo Chávez launched his political career with Fidel Castro as a mentor. Mr. Chávez was a staunch friend of the Cuban revolution, joined Castro in a Latin American bloc opposed to "US imperialism," and showered his resource-poor Caribbean neighbor with oil. In exchange, Cuba dispatched doctors to tend to Venezuela's sick.

But since the death of former President Chávez nearly two years ago, Venezuela's socialist regime has looked shaky. More recently, Venezuela's revenue was slashed by the collapse of global oil prices. Unsurprisingly, Raul and Fidel have been looking to diversify their economic and diplomatic support.

Falling oil prices have “deepened Venezuela’s crisis and [are] likely to diminish a major source of support for Cuba,” says Michael Shifter, president of the Inter-American Dialogue, who is currently in Havana. He adds that Cuba's already "dire economic situation" has been exacerbated.

Economic dejá-vu?
It’s difficult to know just how much Cuba relies on Venezuelan money and oil, given both countries’ opaque governments. But estimates range from $5 billion to $15 billion a year, or around 15 percent of Cuba's GDP.

Mr. Shifter told the Christian Science Monitor in 2012 that were Chávez to lose power in Venezuela, the “impact on the Cuban economy would be enormous.”

Venezuela's Maduro, who was elected in April 2013, has approval ratings in the mid-twenties that appear unlikely to improve soon. Oil sales make up 96 percent of Venezuela foreign currency income.

The Venezuelan currency has fallen over 30 percent in the last month and annual inflation is running at more than 60 percent. Shortages of basic goods, electricity blackouts, and one of the world’s highest murder rates are adding to Maduro's woes.

Many Venezuelans are questioning subsidies for Cuba at a time of economic crisis at home, and cutting Cuba off would prove politically much easier than increasing energy prices for Venezuelans.

Cuba's leaders know how painful it is to lose a benefactor. In the early nineties, Cuba went through what was known as the Special Period after the collapse of the Soviet Union. The economy contracted 35 percent between 1989 and 1993 and oil imports decreased by 90 percent.

Food shortages were common. Some Cubans who grew up in that period, like blogger Yoani Sánchez, complain of stunted growth due to a lack of food. Cuba's economy was still struggling by the time Chávez took office in 1999, and saved the day for the Castros.

“Venezuela threw a last-minute lifeline to the Cuban government," says Christopher Sabatini, senior director of policy for the Americas Society, based in New York. Mr. Sabatini says it’s difficult to overstate the importance that Venezuela’s troubles at home have on the recent news between Cuba and the US.

Filed from
Caracas, Venezuela






More...

On Cuba's New Relationship with the US
Dec. 21, 2014


How Hugo Chavez helped bring the US and Cuba closer together
Dec. 19, 2014


How Venezuela’s Collapse Helped Thaw Cuban-American Relations
Dec. 18, 2014


Venezuela's role in warming Cuba - US relations
Dec. 17, 2014


Photos from Cuba
Sept. 3, 2013


Cuba's Journey on the Internet: There's a Long March Ahead
Aug. 14, 2013


On Cuba's Fledgling Real Estate Industry
Aug. 11, 2013


As Communist Cuba Reforms, Capitalism Slowly Takes Hold of Its Real Estate Market
Jul. 24, 2013


Cubans line up for the chance to leave
Jan. 14, 2013


Havana scraps exit visas, but most Cubans won't be going abroad
Jan. 14, 2013


Blogger gets whiff of Cuba libre as curbs on leaving island are eased
Jan. 13, 2013


Cubans can leave, but to where and with what?
Nov. 11, 2012


Outrage, disbelief over latest dissident arrests
Nov. 9, 2012


Cuban dissident blogger Yoani Sánchez talks US election
Nov. 6, 2012


Cuba cautiously dips toe into capitalism
Jun. 8, 2012








© Girish Gupta