Pressure and Engagement: Tools for a Constructive Approach to the Venezuela Crisis

AP Photo/Richard Drew

The past week has seen considerable international discussion over the most effective methods of responding to Venezuela’s crisis. On October 14 El Pais reported that the Spanish government would encourage a shift in the European Union’s approach to Venezuela, towards a strategy that relies on dialogue rather than sanctions. This is significant, as Spain has been an active player in the EU’s Venezuela response, and there was some speculation that it could successfully cause the EU position to soften. With an estimate of at least 200,000 Venezuelan migrants in the country, many of which possess dual citizenship, Spain has a bigger stake than other EU members in the crisis (see more on the case of Spain here).

However, on Monday EU High Representative Federica Mogherini made clear that the EU would not be softening its approach. “This policy [of sanctioning individuals] is going to continue. The European Union is not looking at softening its position on Venezuela in any way,” she said. But she did say the EU would explore the potential of “establishing a contact group” based on pursuing neither dialogue nor mediation (she said the conditions do not exist for such initiatives), but “exploring the possibility of creating conditions for a political process to be started.”

We see this as a positive development. While we think the assemblage of policies meant to pressure the Maduro government that has developed over the past two years are necessary, we think there need to be more efforts at diplomatic engagement. This engagement should not be seen as alternative to mechanisms of pressure, but complementary to them (See Smilde’s op-ed to this effect here).

In this post we look at a range of different pressure and engagement options being used or considered by international actors, and assess their implementation and effectiveness.

Ineffective Pressure: Military Options

The desperate situation inside Venezuela and the blockage of democratic mechanisms such as free and fair elections and street protest have understandably generated discussion of military options for Venezuela (although  calls for foreign intervention in Venezuela are hardly new). A June poll conducted by GBA Strategies even suggests that almost half of all Venezuelans would agree with foreign military intervention if it removed Maduro (note that these numbers have not yet been replicated by other pollsters).

In our view, not only would foreign intervention be disastrous, it is not an effective pressure strategy either. First, any external military intervention is likely to be costly, bloody, and could devolve into a prolonged civil war or crisis of governance much more extreme than what Venezuela is currently experience. This would exacerbate the regional migration crisis.

For a foreign military intervention to not simply create a worse crisis of governability, it would need to be followed by years if not decades of occupation with all of the violence and human rights violations that occupations generally entail. Perhaps worse, any country or coalition that carried out an intervention would probably not want to assume the costs of years of occupation, leading to years of instability (see the cases of Somalia and Libya). Even where occupations are extended there is little guarantee of success (see the cases of Afghanistan and Iraq). The oft-cited case of Panama is so idiosyncratic—the intervening force actually had military bases within the tiny country—that it is not even worth considering.

Most important in the current context, floating a military option is not an effective pressure tactic. Not only does it give the Maduro government a rallying cry, it actively discourages the opposition from working for unity and strategy. Over the past year, many in the opposition, from politicians to everyday activists, have come to consider efforts at mobilization to be at best naïve and at worst as collaboration with the regime insofar as they put off what they perceive as a quicker and more effective solution: foreign intervention. Expectations of a military intervention create disincentives for them to unify and organize, leading opposition parties and politicians to think it is better to jockey for position for a post-intervention transition than to swallow their pride and sign on to a broader political coalition.

Given the complications of a foreign intervention, many analysts have been enamored by the idea of support for a coup by the Venezuelan military (see here as well). What they tend to forget is that the Venezuelan armed forces are so compromised by corruption and organized crime that a coup would more likely lead to even more far reaching authoritarianism among military officers who want to ensure impunity for their actions. They also overstate the ease and viability of such a coup, seemingly ignoring the fact that Maduro has demonstrated a clear ability to crack down on dissent within the armed forces, having deftly dismantled coup attempts meant to take place in March and May of this year.

Possibly Effective Pressure Mechanisms

The main mechanisms of U.S. pressure on Venezuela’s government have been a combination of targeted and financial sanctions, and non-recognition of the government’s efforts to provide itself with democratic legitimacy. It is important that these initiatives are continued, but in such a manner that maximizes their effectiveness.

On Sanctions

We are not in principle opposed to sanctions. However we are in principle suspicious of them for a simple reason. The research is quite clear that most of the time sanctions are not effective in achieving their goals (see Smilde US Senate testimony here). In most cases they do little other than allow governments to express their displeasure with one another. In other cases they cases they arguably exacerbate the situations they are supposed to be addressing—witness the case of Cuba where, over fifty years, sanctions seem to have become an essential part of the government’s strength.

However, we are supportive of sanctions that meet certain criteria. Research suggests that sanctions are most effective in changing affected states’ behaviors when they have three important characteristics: when they are 1) multilateral, 2) can be lifted in response to changes in behavior, and 3) include clear communications regarding how those affected can get out from under sanctions.

That being said, we are opposed to the imposition of sanctions that could worsen the humanitarian emergency in the country. For this reason we oppose more extreme sanctions packages that would have an unavoidable impact on the general public, such as a proposed embargo on U.S. purchase of Venezuelan oil or a ban on U.S. sales of refined oil to Venezuela. We are also concerned about the financial sanctions imposed in August 2017, but supportive of the fact that they have exceptions that limit a potential negative humanitarian impact.

Targeted Sanctions

With regard to the targeted sanctions on officials, there has been some important progress in meeting these conditions. In the last year, the governments of Canada, the European Union, Switzerland and Panama have all adopted variations of targeted sanctions. In other words, they have become more multilateral. Getting more countries to adopt sanctions against individuals would increase their multilateral nature, and could boost their effectiveness. Ultimately, it signals that individuals who do not break from the Maduro government could have their visas revoked and assets frozen not just in the United States, but around the globe.

But there has been mixed progress around establishing a clear communications strategy around the targeted sanctions, and the conditions under which they can be lifted. The European Union, for instance, has taken pains to specify that sanctions are not designed not to harm the Venezuelan people, and that they can be lifted if there are credible and meaningful negotiations with the opposition, respect for democratic institutions and an electoral calendar, or the release of political prisoners.

This contrasts with the United States communications around targeted sanctions. In private U.S. officials maintain that Venezuelan targets can be removed from sanctions lists by breaking from the government in some fashion—and there is evidence of efforts to communicate this to some targets directly. But such communication has largely been private, and more efforts to publicize the conditions under which sanctions against individuals could be lifted would make it harder for Maduro to portray them as sanctions against the Venezuelan people.

Financial Sanctions

 The U.S. has also implemented financial sanctions that restrict U.S. citizens from dealing in new debt and equity issued by the government of Venezuela and state oil company PDVSA, as well as some existing bonds. As we have noted, there are valuable exceptions to these sanctions that reduce there impact on the broader public. They do not, for instance, apply to the importation of food or medicine, nor to new debt if it were approved by the democratically-elected National Assembly. Thus, while it is clear that these sanctions are having a negative effect on the Venezuelan economy, this is ultimately the Maduro government’s choice for not running issuance of new debt through the National Assembly as happens with most debt in modern democracies.

These exceptions are important, but must be communicated clearer in Venezuela. A survey of Venezuelans commissioned by the Atlantic Council and published in April 2018 found that 43 percent of those polled believed they had been affected by U.S. sanctions. Every individual in Venezuela should know exactly what the financial sanctions do and do not allow, in order to minimize the government’s ability to effectively blame the country’s economic crisis on the U.S. government.

Communication is also important in order to prevent over-compliance by international financial actors. Since the sanctions were announced, there has been evidence of banks denying legitimate transactions that should be exempt from sanctions, and several non-governmental partners of WOLA in Venezuela have conveyed that they have had banking difficulties. This should not be seen by U.S. officials as an “added bonus” to the financial sanctions, but rather as a side effect that ultimately weakens their impact. Over-compliance complicates licit economic actions pursued by the government, weakens private actors that should be strengthened, and strengthens the Maduro government’s claims of a U.S.-backed “economic war.”

Like the targeted sanctions, the financial sanctions have been paired with somewhat vague messaging from U.S. officials regarding their link to clear outcomes. The U.S. mission to the Organization of American States (OAS) has said that the government “stands prepared to amend [the U.S.] sanctions posture in response to positive, significant, and sustained behavior changes by the government,” but it is not clear what specific actions would meet these criteria. As with sanctions against individuals, clarifying this could improve these measures’ effectiveness.

Continued Non-recognition

Immediately after the unconstitutional election of Venezuela’s National Constituent Assembly (ANC), over 40 countries around the globe rejected the legitimacy of the process and its outcome. Importantly, these same countries did so once more following the May 20 electoral process in which Maduro claimed re-election. When Maduro’s previous mandate expires on January 10, 2019, the United States and other international stakeholders will have an opportunity to once again showcase a broad multilateral rejection of Venezuela’s authoritarian slide.

Such actions may seem symbolic, but they matter to Venezuela’s government. Central to the political identity of Chavismo is a national identity as a gregarious regional leader. Widespread regional and international repudiation have complicated this narrative.

Avenues of Strategic Engagement

 As we have argued before, the use of  ‘pressure” as the main metaphor for international engagement is altogether too simple. What is true for hydraulic systems is true for politics as well: pressure is useless without some mechanism by which it can be channeled to a useful end. If international stakeholders want to promote a democratic solution to Venezuela’s crisis, they need to put in place mechanisms of engagement that could channel pressure into change. In what follows we describe some mechanisms that are being or should be explored.

Group of Friends

In the field of international peacemaking, there is an existing mechanism called a “group of friends,” as detailed in a helpful booklet published by the U.S. Institute for Peace (USIP). These groups are not made up of “friends” in the sense of allied countries, but instead of governments that are seen by interested parties as credible mediators. Examples of such initiatives include the Middle East Quartet, and the Contact Group on former Yugoslavia.

A “contact group,” the mechanism that Mogherini referenced, is a kind of group of friends mechanism, although it is usually made up of the major powers interested in the outcome of a conflict. There are also numerous instances of successful mediation efforts being coordinated by non-major powers, states that have simply identified an interest in resolving a conflict.

The most successful example of the group of friends model in Latin America is the Contadora Group launched in the early 1980s, which helped put an end to armed conflicts in Central America. The Contadora Group was formed by the governments of Mexico, Panama, Colombia, and Venezuela, with the support of then Swedish Prime Minister Olof Palme. The group’s peace plan was eventually approved by the UN Security Council, and laid the diplomatic groundwork for the historic 1987 Esquipulas Peace Agreement. This agreement, in turn, eventually led to the establishment of meaningful peace accords in El Salvador, Guatemala, and Nicaragua.

In the current Venezuelan context, both sides—the government and the opposition—seem to have little to gain from entering into meaningful talks. But this could change. A group of friends mechanism, according to the USIP, “is an auxiliary mechanism, engaged in the service of a wider strategy for peace—not a substitute for one. As an auxiliary device, a group of Friends cannot create the conditions for peace, but it can contribute to their emergence in a variety of ways.”

Like the Contadora Group, there is much that a regional group of countries could do to lay groundwork for a meaningful negotiated solution to Venezuela’s crisis. Working with both the opposition and government, they could provide the blueprints for a path out of the current political crisis.

There are a number of countries uniquely positioned to join such a group. These include Uruguay, the Dominican Republic, and Ecuador, all of which have distanced themselves from Venezuela’s government in some form, but have resisted pressure to join international efforts to overtly antagonize the government. The Mexican government under Andres Manuel Lopez Obrador could also play a role in such a group.

The United States is not in the position to be an effective participant in such a group, because it lacks perceived impartiality. However, it could contribute by lending support to shuttle diplomacy initiatives, facilitating discussions between both sides and their mediators.

The talks that took place in the Dominican Republic between the government and opposition in late 2017 and early 2018 were a first attempt at using this model. Both sides selected guarantor countries (the government chose Nicaragua, Bolivia and the Dominican Republic, and the opposition selected Mexico, Chile, and Paraguay) and the foreign ministers of each country carried out some efforts at promoting a deal.

However, the experience lacked important elements that can inform future efforts. One of these is a lack of commitment to sustained engagement. Of the three guarantor countries named by the opposition, the Paraguayan government almost immediately announced that it would not actively participate in more active, good offices diplomacy. The other two guarantors for the opposition by all accounts tried to be supportive in advancing negotiations, but scheduling conflicts of the foreign ministers of Chile and Mexico on at least one occasion caused talks to be postponed at the last minute.

Another essential flaw of the foreign ministers’ group was the lack of apparent coordination between the teams of foreign ministers. It was not apparent that the guarantors named by the government had any level of coordination with the guarantors of the opposition, nor was it clear that the foreign ministers of the government’s guarantors actively prioritized a restoration of democratic institutions in Venezuela in their work.

While the 2017-18 round of dialogue and negotiation was ultimately unsuccessful, it certainly progressed further than previous efforts as a result of the more concerted efforts of the contact group. Further progress will require even more sustained commitment and more coordination.

Cross-national Networks

Difficult political situations often require the development of “social capital,” i.e. networks of trust and personal empathy that can be of fundamental importance in moments of crisis. The revival of the Boston Group by Bob Corker’s Chief of Staff Caleb McCarry, which seeks to maintain high-level contact among US and Venezuelan politicians works in that direction. Originally developed in 2002 during the first crisis of the Chávez government, it has been revived over the past year and bore its first fruit with the release of US citizen Josh Holt from prison in May of this year. Last week Senator Bob Corker visited Caracas and met with government officials, journalists and some opposition politicians. Further development of this mechanism should include previous communication with Venezuela’s opposition politicians who were a caught flat-footed by Corker’s visit and did not respond constructively.

 International humanitarian aid also holds potential for developing social capital. Some progress has been made with the Pan-American Health Organization (PAHO), which is one of the only UN agencies with an effective presence on the ground in Venezuela, and has been given an important leeway to operate by the government. In addition to providing medicine to the public health system through the Strategic Fund, PAHO has received support from the EU government and the Canadians to bring in medicine and distribute it with the partial participation of a network of civil society organizations.

Such mechanisms can create or consolidate networks of trust and information exchange that could prevent suboptimal outcomes if there is a significant breakdown, or could even develop into initiatives that could lead to a pacted solution.

Diplomacy with Other Powerbrokers

In addition to support for shuttle diplomacy, countries concerned with the restoration of democracy in Venezuela need to reach out to other key stakeholders in Venezuela’s crisis, who may have more leverage over the Venezuelan government. While China has demonstrated an apparent interest in propping up the Maduro government, the Chinese also have incentives for supporting an orderly transition, and for hedging their bets. They have maintained a certain distance from Maduro’s government, most recently refraining from clearly backing Venezuelan authorities’ overstated claims of receiving a new $5 billion credit line.

Previously, the Chinese had even sent signals that they were unwilling to provide new loans to the Venezuelan government, and even held unofficial meetings with individual members of the opposition. These points of tension merit exploration.

Another example is the Cuban government. As a recipient of subsidized Venezuelan oil, it is undeniable that it has a clear stake in Maduro’s continuation in power. Yet it is also true that the Cubans are seeking normalization of U.S. relations and an end to the U.S. embargo. Whether there is room to square these interests with Venezuela’s crisis is also worth exploring.

International Pressure and Engagement Have Limits

Ultimately, it is important for diplomats to understand that no combination of external initiatives alone can guarantee a democratic transition in Venezuela. As Venezuelan political scientist Benigno Alarcon argues, international pressure alone is “insufficient to produce a change.” In a recent commentary, he argues that the odds of a democratic transition in Venezuela are increased when international pressure is accompanied by: 1.) internal pressure in the form of mobilization, 2.) some kind of political pact that reduces the “exit costs” of many of those in power, 3.) plans for a transition government, and 4.) the democratic opposition is unified and prepared to participate in elections. Thus, it is important for international stakeholders to recognize the limits of their influence, and encourage domestic actors in Venezuela to do their part as well.