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News > Venezuela

US Blockade on Venezuela Has Cost US$350 Billion: Report

  • According to the report, the U.S. created the necessary conditions to allegedly

    According to the report, the U.S. created the necessary conditions to allegedly "legitimize" military intervention in Venezuela. | Photo: CELAG

Published 9 February 2019

According to the study, these economic and financial attacks "are usually the prelude to military intervention."

The Economic Debates Unit of the Latin American Geopolitical Strategic Center (CELAG) released a report on "the economic consequences of the boycott against Venezuela," on Friday, in which it is proved that the "international financial blockade to Venezuela since 2013 is the main responsible for the economic crisis."

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According to CELAG's report, the financial and economic blockade that was mainly promoted by the United States, and enforced by its allies, would have cost Venezuela around US$350 billion "in the production of goods and services between 2013 and 2017."

Blocking a country financially is paramount when trying to asphyxiate the national economy. The external attacks are able to undermine the economic and productive capacity of the country, and therefore, destroy the economy. According to the study, these economic and financial attacks "are usually the prelude to military intervention."

The U.S. government led by Donald Trump is arguing in favor of military intervention in Venezuela, to allegedly end a so-called "humanitarian crisis," but the "alleged humanitarian crisis and the migration of hundreds of thousands of Venezuelans have their origin in the economic boycott of the United States and its allies."

According to the researchers, the U.S. generated a crisis that would serve as an excuse for military intervention in Venezuela. "The US government justifies an eventual intervention, based in the alleged humanitarian catastrophe and in the massive emigration that its blockade, precisely, would have created."

Venezuela has been forced out of financial markets, which led to the impossibility of accessing credits. Even though it is one of the countries that has paid its external debt on time, "agencies such as Standards & Poor's or Moody's, have put the country-risk rate above 2,000 points since 2015," according to the CELAG report.

Venezuela is a country that enters the global market mainly because of its oil production. This "productive specialization led to a high dependence on imports," which are normally paid with the income of exporting oil. "That is why the financial and commercial boycott of Venezuela has much more serious consequences than in diversified economies."

According to the study, since President Nicolas Maduro was sworn-in in 2013, "the Venezuelan public sector stopped receiving in net terms flows that in the quinquennium 2008-2012, more than USD$95 billion dollars, that is, about USD$19 billion per year," due to the blockade. On top of that, the government had to pay higher amounts of money due to the country-risk rates, for external debt. "The Venezuelan Government had to pay more than US$17 billion dollars in the five-year period 2013-2017, about US$3.3 billion dollars per year."

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The study adds that the Venezuelan economy and society "suffered international asphyxiation of US$22.5 billion dollars a year resulting from a deliberate international strategy of financial isolation. "It is necessary to also include the fall of crude oil prices that happened around 2015.

If the Venezuelan government had the possibility of accessing over US$22 billion a year, the economy would be in a better place today. "As a consequence of the blockade, losses in the production of goods and services oscillated between a range of USD$350 billion and USD$260 billion in the period 2013-2017."

The study concludes that, "if the government of Nicolas Maduro had received international financing, such as the one available to Mauricio Macri during his first three years in office, the growth of Venezuelan GDP would be higher than that of Argentina."

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