Venezuela: A country that has squandered billions

Venezuela is the country with the largest oil reserves in the world. In the 1970s, he was the richest country in South America. Many people, not only from South America but besides from Europe, chose Venezuela as an emigration country. present Venezuela is on the verge of collapse – the standard of surviving is dramatically low, and hyperinflation was able to scope 1,000,000%. How is it that 1 of the richest countries in the planet has fallen?

Golden Times

Already in the early 20th century, the first oil deposits were discovered in Venezuela. Since the 1930s, this country has become the main supplier of oil to the US and Europe. However, the real revolution took place in the 1950s. Oil accounted for 95% of export revenue, making Venezuela the largest oil exporter in Latin America. Black gold financed all sectors of public life. Of the export proceeds, 1.5 million barrels a day were financed by roads, schools, and cities. gross from oil supplied the full state apparatus – the country almost did not collect taxes. Access to housing, cars and abroad products was common. The country was considered an oasis of stableness in unstable Latin America, where dictatorships and force prevailed. Venezuelan passport allowed easy travel – many citizens flew to Miami, fresh York or Madrid for buying and holidays. But prosperity was only temporary.

The beginning of the crisis

Venezuela's economy was entirely based on oil. another sectors specified as agriculture and manufacture were underinvested. In the 1980s, there was a crisis in the oil marketplace – prices per barrel fell from 35 to 15 dollars. In 1983, abroad debt rose to $30 billion, and the country was forced to declare insolvency. The store shelves began to deficiency basic goods, and the government was forced to cut social benefits. Bolivar – the currency of Venezuela – began to lose value, which started increasing inflation. All these circumstances led to massive protests in 1989 in Caracas, the country’s capital. There are over 300,000 people on the streets. However, these were not peaceful manifestations – shops and warehouses were destroyed and looted, and there was a theft of medicines and food, which became luxury goods. Banks, police stations and government buildings were attacked. In response, the government declared a state of emergency and introduced a curfew. An army was sent to the streets of Caracas, which bloodyly suppressed riots. respective 1000 people died, and another twelve 1000 were arrested, where they were tortured and frequently convicted without trial. The 1989 events were namedEl Caracazo and by many are considered the symbolic end of Venezuela's prosperity period.

El Comandante

The economical crisis continued in the 1990s. Young captain Hugo Chávez conducted 2 failed coup attempts. He built his popularity on criticism of corrupt power, anti-Western rhetoric and the slogans of combating poverty. It was supported by the poorest social strata that grew year by year. In 1998 Chávez won the election and began the alleged Bolivian revolution. He passed a fresh constitution, nationalised many industries – including the strategical oil sector. Tens of social programs (missiones) were created, including the construction of inexpensive housing and free wellness care in mediocre neighborhoods. However, Chávez's policy was only seemingly a breath for the tired crises of citizens. Price control, currency controls and import restrictions were introduced, leading to the improvement of the black marketplace and the withdrawal of abroad investors. Private property was restricted. Social life was controlled by the state – the military was liable for distributing food and fuel, and many generals led ministries and state companies. The opposition was repressed and independent media were forced to act in the underground. Chávez became a de facto dictator and gave power only after his death in 2013.

Hyperinflation and Migration

After the dictator's death, his erstwhile vice president took over – Nicolás Maduro, which further increased the oppression of the state apparatus. In 2018 and 2024 presidential elections were held, which, according to both independent observers and the opposition, were falsified. Authorities apply repression of the opposition by arresting activists and limiting freedom of speech. In May 2025, about 70 opposition activists were detained. Maduro accuses opponents of plots and coups; the authorities suspended flights from Colombia claiming that the mercenaries planned terrorist attacks. Venezuela's economy has shrunk by over 60% since 2013, 1 of the deepest economical crises in the past of a country that was not under war. In 2018, inflation reached 1.35 million percent, resulting in a full failure of the value of the carpentry. The shortages of basic goods – specified as food and medicines – are common. Breaks in electricity and water supply are everyday. Since 2015, around 7.7 million people have emigrated from Venezuela, accounting for over 20% of the country's population. Many of these people settled in neighboring countries – specified as Colombia, Peru or Brazil – but besides in the United States and Europe.