The crisis in Venezuela : a study showing how a wealthy nation collapse

Abstract

The Venezuelan crisis was filling the headlines during 2019, and took the world’s attention. The country that once was the wealthiest in Latin America suffers the worst economic crisis of a country that is not experiencing war since the 20th century. Diseases, collapse of institutions, destitution, and repression have led millions to flee the country to neighboring states. Venezuela, that sits on the largest oil reserves in the world, has the phenomenon called “the resource curse”, where the government is spending all the money coming from oil without injecting any back into the economy. The previously democratic country is now being transformed into a dictatorship under former president Hugo Chavez and now his pupil, Nicolas Maduro. The socialist system that Chavez started to build when he reached power in 1998 is still ongoing but its results are not what the regime have initially foreseen. Adding to that, geopolitical pressure and aggression came as the final blow that made the state collapse. The crisis in Venezuela is caused by the simultaneous presence of all aforementioned phenomena, the resource curse, bad socialist policies, Developmental dictatorship, and geopolitical aggression. This paper studies how these four phenomena developed and caused the collapse of the Chavez regime.