Sanctions are political, not legal instruments. Their goal is to cause pain and suffering in order to force populations to overthrow their own governments and surrender their sovereignty.
After Venezuelan president Hugo Chávez’s death on March 5, 2013, Washington began an economic siege to impede the continuation of the Bolivarian Process and the newly elected Nicolás Maduro government. The first war-like measure was Executive Order 13692, signed by President Barack Obama on March 8, 2015, which declared Venezuela an “unusual and extraordinary threat to the national security and foreign policy of the United States”.
Although downplayed as inconsequential by the corporate media, the Obama decree began the “toxification” of Venezuela, with international investors and companies recoiling from doing business with a nation targeted by the world’s largest financial and military power.
In 2016, Citibank was the first institution to do so by closing accounts of Venezuela’s Central Bank and the Bank of Venezuela after conducting a risk management review. Caracas, despite stubbornly servicing its foreign debt, also faced rising borrowing costs.
However, the fiction of Venezuela being a “threat” was just the basis for the upcoming full declaration of war, a unilateral and illegal one. EO 13692 provided the “legal” grounds for the U.S. Treasury Department to impose a wide-reaching sanctions program against the country, its economy and its people. Because the Obama decree has no expiration date, the siege can be perpetuated indefinitely.
Maximum pressure
In 2017, President Donald Trump announced a “maximum pressure” campaign to block any chance of economic recovery and accelerate Venezuela’s social collapse. Trump likewise began to threaten that “all options were on the table”.
The siege especially targeted the country’s main source of revenue: the oil industry. In August 2017, the U.S. Treasury Department’s Office of Foreign Assets Control imposed financial sanctions against state oil company PDVSA followed by an export embargo in January 2019.
With crude production falling from 1.9 million barrels per day (bpd) in 2017 to 350.000 bpd in 2020, GDP shrank by more than 65% between 2014 and 2019, hurting essential imports as the country entered hyperinflation.
The primary and secondary sanctions combo led to severe fuel shortages as well. Without diesel fuel to power thermal generators, the country became over-reliant on hydroelectric power generation, which was also hit by a lack of access to imported equipment. As a result, a massive electricity crisis broke out in March, 2019.
With Venezuela sitting on the world’s second-largest certified gold reserves, the mining sector was the next major target. In March 2019, the U.S. Treasury Department sanctioned Venezuela’s General Mining Company (Minerven), blocking trade with U.S. persons and companies.
Caracas was using gold reserves to pay for food, fuel, medicine and other imports.
The ban on the gold trade was followed by embargoes against the Venezuelan public banking system. In April that year, the U.S. Treasury blacklisted the Central Bank of Venezuela (BCV) to restrict transactions and prohibit its access to U.S. dollars. Other executive orders resulted in the closure of several Venezuelan bank accounts in international financial institutions as well as a loss of access to credit.
According to the Venezuelan government, since 2019 more than US$8 billion worth of Venezuelan assets and funds remain frozen or blocked by banks in the U.S., Portugal, Spain, Britain, France and Belgium, including nearly $2 billion in gold retained at the Bank of England. Washington alone has blocked the use of $342 million in accounts from BCV.
The entire sanctions program was reinforced by notifications issued by the Financial Crimes Enforcement Network in September 2017 and May 2019, warning institutions not to deal with the Venezuelan state, even for essential imports.
The new executive order banned all transactions with Venezuelan state entities and blocked state assets on U.S. territory, prohibiting them from being “transferred, paid, exported, withdrawn, or otherwise dealt in”. In February 2020, Venezuela’s state airline CONVIASA was blacklisted as well.
The economic siege came alongside a ludicrous political gambit as the Trump administration supported the self-proclamation of Venezuelan opposition politician Juan Guaidó as “Interim President” in January 2019. The “parallel government” act lasted until early 2023. Guaidó was granted control of Venezuelan bank accounts and state assets seized by Washington and allies to fund his coup efforts, including $10-billion-worth U.S.-based oil subsidiary CITGO and $269-million-worth Colombia-based fertiliser Monómeros.
In 2021, President Joe Biden took the reins of the medieval-type siege against Venezuela and left it essentially intact, including one particular perverse aspect: the “starvation sanctions”.
Starvation as foreign policy
Food purchases became an obstacle course as Venezuela’s public and private sectors lost access to the international system of payments and banks discontinued services out of fear of running afoul of U.S. sanctions. For example, in November 2017, Puerto Rico’s Italbank closed an account with Venezuela’s Central Bank because of “concerns about reputational risk”. The small bank was used by Caracas to process food and medicine payments.
In July 2019, Washington fully established starvation as a main foreign policy goal by targeting a host of individuals and companies allegedly connected to Venezuela’s Local Food Supply and Production Committees (CLAPs), created by the Maduro government in 2016 to distribute low-cost food boxes to working-class families. One notorious case was Colombian-born businessman Alex Saab, who was targeted for allegedly profiting from overvalued state contracts.
In September 2019 and January 2021, the U.S. Treasury announced more sanctions against three individuals and almost 30 companies for supplying the CLAP program. The starvation tactics were exacerbated in June 2020, when Trump nixed oil-for-food swap deals. As a result, an estimated 6-7 million working-class families suffered the consequences of fewer and lower quality CLAP products while food insecurity became widespread amidst shortages and soaring prices.
The human cost
Hunger came alongside diminished access to healthcare and other basic human rights as the Venezuelan people were hit by these invisible bombs called sanctions. Yet, to this day there is no systematic way to track casualties. There are, however, three studies that provide an approximation of the devastation caused by Washington and its allies.
An April 2019 report by the Center for Economic and Policy Research (CEPR), by economists Mark Weisbrot and Jeffrey Sachs, estimated that U.S. economic sanctions were responsible for 40,000 deaths between 2017 and 2018 and placed hundreds of thousands of chronic patients at risk due to the impossibility to get medicines or treatments in the upcoming years.
In September 2021, following a visit to Venezuela, UN Special Rapporteur Alena Douhan reported that more than 2.5 million Venezuelans were suffering food insecurity after imports dropped 73% between 2015 and 2019, while fuel and diesel scarcity endangered food production and transportation.
Douhan also warned that the insufficiency of basic medicines and their rising prices placed some 300,000 people at risk while thousands of cancer, HIV/AIDS, and tuberculosis patients were in dire need of treatment. Surgical procedures were reduced for lack of anesthesia and antibiotics, and due to only 20% of hospital equipment functioning. Additionally, the UN expert attested to an increase in teenage pregnancies and HIV/AIDS cases while 2.6 million children were deprived of vaccines.
The report noted that the impact of sanctions on the economy led to an unprecedented migration wave, resulting in a brain drain of “doctors, nurses, teachers, engineers, technicians and others”. According to the UN, 7.1 million Venezuelans have migrated due to the crisis between 2015 and 2023.
Venezuelan human rights organisation SURES reported that Citibank and Euroclear were rejecting transactions to buy insulin doses and dialysis treatments, while pharmaceutical companies like Baxter, Abbot, and Pfizer repeatedly refused to issue export certificates for cancer treatments for Venezuelan patients.
SURES highlighted the case of several children dying since early 2019 after not receiving liver, kidney, and bone marrow transplants abroad because banks and private companies became overly cautious in dealings with Venezuela. Venezuelan children had been beneficiaries of a humanitarian program financed by oil subsidiary CITGO, seized by Washington.
Finally, SURES stated that women, children, indigenous communities and people with disabilities were the most affected by the economic crisis exacerbated by U.S. sanctions. The latter group has seen prosthetic donations reduced, with NGOs and government social programs unable to import them.
The three studies agree that it is not possible to fully grasp the damage caused by sanctions against the Venezuelan people, but all the evidence points to one simple truth: sanctions kill and will continue to do so.
[This is an abridged and edited version of an article which appears in A War Without Bombs: The social, political and economic impact of sanctions against Venezuela. Andreína Chávez Alava is based in Caracas and writes for Venezuelanalysis.]