1. Economic and Political Events from 1913-2002
     1913 - 1958: Military Rule, the Beginnings of Oil Production    1958 - 1989: Democracy, the Creation of OPEC    1990 - 2012: President Hugo Chavez    2013 - Present: President Nicolas Maduro  

2. References

Venezuela, officially the Bolivarian Republic of Venezuela, is a country located on the northern coast of South America known for its large proven oil reserves. Before oil was discovered, Venezuelan production was primarily agriculture, such as coffee and cocoa^[1]. After the first commercial drilling for oil in 1917, oil production increased drastically due to the oil boom of the 1920s and was later furthered by World War II, as Venezuela supplied oil to the United States^[2]. From 1958 to 1989, democratic leaders attempted to use the large oil revenues to invest in other industry through various policies such as import substitution^[3] and other programs designed to diversify the Venezuelan economy away from a highly specialised export range. These attempts, for the most part, were unsuccessful as Venezuelan government revenues continued to be highly volatile due to the fluctuating price of oil, which was reflected especially throughout the 1980s due to the oil price crash^[4]. After struggling with fiscal debts sue to a variety of trade protection measures and other policies^[1], the President of 1989, President Perez, worked with the International Monetary Fund in an attempt to rectify some of the issues plaguing the Venezuelan government. Perez was eventually unsuccessful due to mass rebellion due to proposed austerity measures, and Hugo Chavez was later elected in 1998, after a defeat of both major political parties. The Chavez government begun enacting various socialist programs, such as free education and healthcare^[6], as well as attempting to control the value of the currency to prevent capital flight^[4]. These programs would continue up until Chavez's death in 2013. President Nicolas Maduro, Chavez's successor, was elected on 14 April 2013^[5] and pledged to continue Chavez's work. However, due to hyperinflation, shortages of food and medicine and political instabilty, about 3 million Venezuelans have fled the country since 2015^[6].

Economic and Political Events from 1913-2002

1913 - 1958: Military Rule, the Beginnings of Oil Production

In 1913, Dictator Juan Vicente Gomez issued a concession to explore twelve of the twenty Venezuelan states for oil to the Royal Dutch-Shell Oil Company^[2]. The first commercial drilling for oil in Venezuela occurred in 1917, however the existence of oil was known before this. Along with the oil boom of the 1920s, World War I was important in triggering Venezuelan oil production^[1]. Shortly after this, the oil boom of the 1920s meant Venezuela became the wealthiest state in Latin America^[1]. Investment and oil exports increased tremendously during the period from 1920 to 1935. The share of oil exports on total exports in Venezuela increased from 1.9% to 91.2%^[3]this period due to the commercialisation of Venezuelan oil.

During this period, agricultural production declined drastically, resulting in an economic phenomenon known as ‘The Dutch Disease’, where a commodity increases income for one sector of the economy to the detriment of other sectors due to a strong currency^[7]. Due to this, Venezuela fell behind other Latin American countries in terms of the level of industrialisation^[3].

In 1936, the Venezuelan government first introduced the idea named ‘Sembrar el petroleo’, meaning ‘to sow the oil’. The idea of this was that oil revenues were fleeting, and so reinvesting oil income into agriculture and other industry would benefit Venezuela^[8]. This ended up having limited effects in the economy as World War II broke out and Venezuela continued supplying large amounts of oil to the United States^[2]. Through the 1950’s, the Venezuelan economy grew at a healthy rate despite rampant corruption and deceit for foreign companies and the indifferent stance of the government^[1].

1958 - 1989: Democracy, the Creation of OPEC

In 1958 Venezuela elected President Romulo Betancourt in a presidential election after a military coup ousted the first democratically elected president of Venezuela, President Romulo Gallegos^[9]. Romulo Betancourt’s government founded the Central Office of Coordination and Planning (also known as Cordiplan) which issued multiyear plans with broad economic development objectives^[1] Throughout his tenure, the government pursued social projects such as improving health, education and access to potable water, an effort propelled by the leftist Democratic Action Party that Romulo Betancourt belonged to^[10]. These efforts were mainly focused on improving education and health in an attempt to diversify Venezuelan exports away from oil to encourage other industry to develop. Despite these efforts, the government made little progress towards diversifying its own revenue streams, passing reforms of its oil policy with the Hydrocarbons Act of 1943. The Hydrocarbons Act changed the basis of oil income from concessions and customs revenue to taxes based on income from mining^[3]. Coupled with Venezuela’s oil revenues and thus an increasing dependence on them, this act led to a heavy reliance on government oil revenues rather than conventional revenues such as income tax^[3]. As well as this, in 1960 the Organisation of the Petroleum Exporting Countries (OPEC) was created. Venezuela, along with Iran, Iraq, Kuwait and Saudi Arabia were its founding members^[2]. Despite the creation of OPEC in 1960, they only began setting the oil price in 1973. To do so, the member countries seized their domestic production of oil to control the price and quantity at which oil was exported at in each member country. In Venezuela, the government resolved to stop giving out concessions, and later semi-nationalised its oil and steel industries in 1973^[2].

From 1972 to 1974, world oil prices rose drastically and almost quadrupled Venezuelan government revenue. During this period President Carlos Andres Perez was elected and pledged to make Venezuela a developed country within a few years^[3], known as 'La Gran Venezuela' which was to be done through policies revolving around financing state-owned and enterprise-led industrialisation in order to facilitate heavy import substitution as a rebirth of the ‘sow the oil’ campaign^[10] as well as price controls, income increases and fighting poverty^[3]. Import substitution industrialisation (ISI) was a popular method of industrialistation in the 1970s, especially in Latin America. It, ideally, would stimulate economic growth and development through establishing (and protecting) domestic production of goods that were otherwise imported^[11]. To further the ‘sowing of the oil’, government spending increased by 26 per cent per year^[10] and established many new state-owned businesses as well as purchasing private ones in an effort to stimulate economic growth and development^[1], and further the policy of import substitution. In 1976, the government fully nationalised the Venezuelan oil industry with the creation of 'Petroleos de Venezuela' (Oils of Venezuela, or PDVSA)^[3]. In its first year of operation, Petroleos de Venezuela had three affiliates known as Lagoven, Maraven and Corpoven. Together, Petroleos de Venezuela produced a total of 2.3 million barrels of oil a day in its first year^[2].

Despite the oil boom of the 1970s greatly benefiting Venezuela in terms of export revenues and development, due to large government projects and heavy spending, the Venezuelan government had an increased indebtedness as well as a chronic inflation problem due to the price hike^[3]. These issues typified the presidential campaigns of 1978-1979 due to concerns about the rapid rate of public and private expansion^[1]. Despite these concerns, the newly elected president Luis Herrera Campins continued the frenzy of government spending after oil prices surged again from 1978 to 1982^[1]. Due to this dismissal of growing problems with debt and government expenditure, when oil prices declined in the mid 1980s due to an oversupply of oil. This resulted in a seventy percent decrease in the price of oil from November 1985 to March 1986^[12]. Given that Venezuelan oil revenues represented almost 60 percent of total government revenue^[13], this had a large effect on government finance and exacerbated the problems Venezuela was already dealing with in terms of fiscal policy and the exchange rate. As a result, the national debt multiplied and the government could no longer support its large array of protections such as price controls and subsides, as well as over four hundred state-owned businesses^[1]. As well as struggling with debt and currency issues, in the late 1980s inflation in Venezuela rose to 84.5% in 1989. Through 1983 to 1989, there were attempts to recover from the oil shock of 1983 by devaluing the currency, increased import protection and other methods of protection^[1], to little degree of success due to high inflation, interest rates and widespread corruption. In 1989, President Carlos Andres Perez was elected and attempted to combat these issues using various International Monetary Fund (IMF) loans and other austerity measures^[9], however this ultimately resulted in what is now known as the 'Caracazo'. This refers to the mass rebellion that occurred on the 27th of February 1989, after the IMF 'Structural Adjustment Package' (a series of policies such as privatising utilities, remove import tariffs and other policies designed to reduce the fiscal deficit) was launched by President Perez^[14]. Following the rebellion, between 300 to 3000 were killed by security forces that were called in after President Perez declared a state of emergency^[14].

1990 - 2012: President Hugo Chavez

In 1992, the then Colonel Hugo Chavez and his made 2 coup attempts, resulting in 2 years jail time^[9]. During this time, Chavez met with Luis Miquelina, a left-wing activist who ultimately advised Chavez to pursue his political ambitions through the electoral process^[15]. Consequently, after his release in 1994, Chavez began to pursue politics instead of military power, and created the party 'Movement for the Fifth Republic'^[2]. After the election of 1994 in which Raphael Caldera, the Copei party leader^[15] was elected President, Chavez began to gain support and in 1998, both major parties were defeated and Chavez was successfully elected^[16]. Chavez's party offered an anti corruption, anti poverty programs and a more pacifistic democracy^[2], where the major concerns would be the welfare of the people. He began his presidency by proposing a new Constitution and held a referendum to decide if the people would support this. Chavez received 71% of the votes in the referendum, allowing for the creation of a new Venezuelan constitution^[2]. This constitution was later created by the people electing delegates to a constitutional assembly in order to form the new constitution^[2]. When the project was submitted to the public in December of 1999, it received a 72% yes vote, allowing Chavez to introduce the new constitution, named the Constitution of the Bolivarian Republic of Venezuela^[2], named after Simon Bolivar, a military hero from the Wars of Independence in South America^[17] Throughout this time, multiple referendums and elections were used to enact various constitutional reforms^[15] to strengthen power over these institutions.

Before Chavez took office on the 2nd of February 1999, he visited the leaders of the OPEC countries and later the OPEC countries convened in Caracas, Venezuela for the second OPEC summit in September 2000^[2]. The meeting involved reestablishing OPEC as a leader in the world oil market as well as recovering oil prices^[2], as Venezuela has become one of the cartel's most unreliable producers in regards to the quotas set by OPEC^[3]. Soon after this summit, Chavez came into problems with Petroleos de Venezuela (PDVSA) as the organisation had been focusing on producing as much oil as possible instead of adhering to the OPEC quotas^[3]. This issue would continue for some time until the Chavez government confronted PDVSA, arguing that the Venezuelan oil industry needed another nationalisation, as PDVSA had become 'a state within a state'^[3].

In 2001, Chavez used the enabling act, which allowed the President to enact various laws without legislative approval^[18], to enact over 49 laws designed to redistribute land and wealth in Venezuela^[9]. This action caused some business and labour circles to grow vary of attempts to consolidate economic and political power. During this time, the new Hydrocarbons Act was also introduced, increasing the taxes companies were required to pay for oil exploitation^[2]. Tensions within the country came to a head in 2002 when a coup removed Chavez from power for several days, exploiting the media in Venezuela in order to promote the coup and associated strike as well^[2]. This continued for several days until business leader Pedro Carmona and his vice president Diosdado Cabello were removed from Miraflores Palace and Chavez was restored to power^[9]. After the coup, Chavez began to purge political opponents from the armed forces^[15], solidifying his power over the institution, as well as later firing 18000 workers at PDVSA who went on general strike in an attempt to force Chavez out of power^[15]. The general strike and the aftermath of it allowed Chavez to retake control of PDVSA. The strike cost Venezuela approximately 13.5 billion dollars in direct loses due to the shutdown of PDVSA for over two months and the need to import oil and gas from Brazil to run transport and other facilities^[2].

In 2004, Chavez and his government returned to furthering their programs promoting welfare and the redistribution of wealth across the Venezuelan people, particularly focused on the poorer areas of the country. These programs were known as 'misiones' and allowed (and were staffed by) many Cuban teachers, doctors and paramedics to practice in Venezuela and were financed by oil export revenues.^[15] After winning the referendum (a 'recall' referendum designed to oust Chavez), he continued to forward the programs established beforehand and further consolidating power by increasing control over the judiciary sector^[15]. As well as this, the Chavez government also begun to attempt to correct the issues around the value of the Venezuelan Bolivar and attempt to combat inflation as well. In 2003, the central bank suspended auctions of dollars in order to prevent massive capital flight due to speculations of a steady decrease in the value of the bolivar, as well as fears of national debt repayments^[4]. As the Venezuelan central bank's foreign reserves dropped from 11.93 billion USD to 11.05 billion USD in January 2003, the Chavez government instead reverted back to applying currency controls^[4] by fixing the bolivar to the dollar. This resulted in foreign currency reserves recovering^[19] from the harsh drop at the beginning of 2003.

These types of programs mainly dominated the initiatives of the Chavez government whilst in power. In 2008, Chavez announced initiatives to increase production and private sector involvement in Venezuelan economic growth^[20], mainly for food production, agro-industry, machinery, manufacturing, petro-chemicals, energy production and public works such as housing and other urban development in an attempt for Venezuela to obtain technology to produce such goods domestically^[20]. As well as this project, the Chavez government initiated several other works such as approving 566 million USD to be used to fund various infrastructure projects, such as the MetroCable (a service designed to carry citizens to the hill side towns of Caracas)^[21].

In 2010, the currency was once again devalued, with the creation of a two-tiered exchange rate with the second rate known as the 'oil bolivar'^[22]. The 'oil bolivar' rate was introduced as the rate for non-essential imports, pegged at 4.3 per dollar and the regular rate devalued to 2.6 per dollar^[22]. This was introduced in order to prevent capital flight, as well as strengthen the economy after a 2.9% contraction in 2009 due to lower oil prices^[22]. In 2011, Chavez approved the issue of 45 million bolivars worth of government bonds in order to fund various public projects, although would be primarily used to maintain existing public projects such as state housing projects, food production and national agricultural production through Agro Venezuela (the state run mission for agriculture)^[23].

After President Chavez died in 2013, his successor, Nicolas Maduro, was elected to power.

2013 - Present: President Nicolas Maduro

With the election of President Maduro on 14 April 2013, Chavez's successor was sworn into power^[5]. Maduro mainly continued the work that Chavez set out to do, such as increasing the minimum wage by 10% in 2014^[24], however in 2014 protest broke out in various Venezuelan states, beginning in Tachira and Merida in response to an attempted rape of a female student, as well as record inflation and shortages of basic goods^[25]. These protests ended in violence, and later resulted in US sanctions against several Venezuelan officials^[26]. In response, the Maduro government gave the President the power to legislate by decree for nine months^[26]. In 2016, the situation resulted in Maduro calling a state of emergency as shortages for basic goods resulted in long queues and inflation increased to over 700%^[27]. This trend of hyperinflation (where inflation rises more that 50% every month)^[28] results in a large currency devaluation and due to continuously high prices of goods and services, hoarding of said goods and services^[28]. Due to this, the United Nations estimate that about 3 million Venezuelans have fled due to hyperinflation, shortages of food and medicine and political violence^[6].

References

• 166 U.S. 226
• 1670 in Denmark
• 1670 in Norway
• 1670 in Sweden
• 1671 in Denmark
• 1671 in France
• 1671 in Norway
• 1671 in Sweden
• (16721) 1995 WF3
• (16722) 1995 WG7
• 1672 in Denmark
• 1672 in Norway
• 1672 in Sweden
• (16735) 1996 JJ
• (16738) 1996 KQ1
• (16739) 1996 KX2
• 1673 in Denmark
• 1673 in Norway
• 1673 in Sweden
• 1674 in Denmark
• 1674 in France
• 1674 in Norway
• 1674 in Sweden
• 1674 Polish–Lithuanian royal election
• 1674 Treaty of Westminster