Emboldened Venezuelan Opposition Plans Showdown With Maduro

(Bloomberg) -- Venezuela’s opposition-dominated National Assembly is making a concerted effort to unseat autocratic President Nicolas Maduro, invoking constitutional measures that would seat an acting chief executive and offering blanket amnesty to military and government officials who help in bringing down the regime.

In a matter of a week, Venezuela’s beaten down and divided opposition has rallied around a 35-year-old lawmaker, Juan Guaido, who was sworn in as assembly president just two weeks ago. He has spoken publicly about the emergency line of succession under which he could become the constitutional leader of the crisis-weary nation, but has stopped short of claiming the title.

In a flurry of action Tuesday, CNN reported that U.S. President Donald Trump is preparing to recognize Guaido as Venezuela’s real leader while Vice President Mike Pence spoke with him to offer support. Guaido, a close ally of political prisoner Leopoldo Lopez, has also spoken with a lawmaker son of Brazilian President Jair Bolsonaro. In an opinion piece in the Washington Post, Guaido laid out his argument for why the assembly -- the only democratically elected body left -- should form a transition government and call for new elections.

Emboldened Venezuelan Opposition Plans Showdown With Maduro

“As president of the National Assembly, I am fully able and willing to assume the office of the presidency on an interim basis to call for free and fair elections,” Guaido wrote. “With a united National Assembly, along with the military, the people and even those who still support this regime, we can materialize the mandate the Constitution endows on us.”

The opposition and at least 60 countries have argued that Maduro’s election victory was won through fraud and that his second term, which began Jan. 10, is illegitimate. Since Maduro succeeded Hugo Chavez in 2013, the country’s economy has collapsed and it has been ravaged by hyperinflation and hunger.

Illegitimate President

On Tuesday, the National Assembly formally declared Maduro’s new term illegitimate, called for a transition government and demanded elections “as soon as possible.” The assembly said it would “set the legal conditions to begin a gradual and temporary process” for Guaido to assume the presidency in the absence of a legitimate leader.

Trained as an engineer, Guaido began organizing demonstrations against Chavez more than a decade ago. He formed a close relationship with Lopez, then a Caracas mayor, and later helped him form the Popular Will party. Even with Lopez under house arrest, they talk several times a day.

Guaido “is smart in realizing he can’t just declare himself president,” said Jennifer McCoy, a political scientist at Georgia State University and former director of the Americas Program at the Carter Center. “There’s also risks. It strikes a clear fight with the government and gives them an excuse to disregard international figures and find some reason to arrest him, as they’ve done to others.”

The Maduro regime is taking the threat seriously. On Sunday, political police briefly detained Guaido. Though officials later disavowed the action, video of the arrest spread quickly. In a Monday speech, Maduro scoffed at the idea of handing Guaido the reins of power. “I’m going to give you the sash, big boy, to see what you do with the country,” Maduro said, referring to the president’s tricolor ceremonial garment.

Street Politics

Both the opposition and government have called for large marches on Jan. 23 as a test of strength and faith from their followers. The date marks the 1958 toppling of military dictator Marcos Perez Jimenez. A strong showing by Maduro opponents could energize not only the traditional middle- to upper-class political opposition but also poorer Venezuelans who bear the brunt of the crisis.

“The perception now is there is a more systematic and coherent plan than in previous years,” Diego Moya-Ocampos, a political risk analyst at IHS Markit, said referring to the legislation passed Tuesday. “In reality, they’re still sort of making it up as they go along, but the opposition is at least united in their goal to secure elections.”

Moya-Ocampos said he doesn’t necessarily see Guaido becoming an interim president, and instead believes that he’s ultimately “trying to force an election. He’s a means to an end.”

Pressure at home and abroad has failed to persuade Maduro to change course, and he has quashed opponents and their efforts to remove him through votes or force. In 2017, he convened an all-powerful Constituent Assembly and virtually nullified the legislature, the National Assembly, which is the only elected institution not controlled by his allies. Protests that had claimed more than 120 lives swiftly petered out.

Emboldened Venezuelan Opposition Plans Showdown With Maduro

Under Maduro’s leadership, Venezuela’s oil production has sunk by about 1.5 million barrels a day, the economy has contracted for five straight years and inflation has skyrocketed to an estimated 239,900 percent. The crisis and political crackdown have driven almost 3 million Venezuelans to leave their country by land, sea or air and the military has amassed ever more power over the economy as a reward for political loyalty.

After suspending most debt payments in late 2017, most of Venezuela’s bonds trade in the low- to mid- 20-cent range, though they’ve seen a rally of sorts in recent weeks. The country’s dollar bonds have jumped 21 percent this year on average, according to JPMorgan Chase & Co., for the best gains in developing markets.

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