Valdai Club

The Anti-Blockade Law has been key to Venezuela’s path to recovery. Even analysts that have made Venezuela’s economic failure part of their agenda have had to recognise Venezuela’s economic growth this past year and how the country has overcome hyperinflation.

In December, 2014, as the Obama Administration celebrated a new step to improve its relations with Latin America by announcing the normalisation of relations between the two countries, the US Congress passed a law that, under the pretext of “defending Venezuelan democracy”, paved the way for the implementation of illegal, unilateral coercive measures against the people of Venezuela. Based on the Venezuela Defense of Human Rights and Civil Society Act, President Obama issued on March of 2015 an Executive Order labelling Venezuela as an “unusual and extraordinary threat to the national security and foreign policy of the United States”. A set of unilateral US “sanctions” — not to be confused with legal sanctions under international law, as applied by the UN Security Council — ensued, targeting Venezuelan government officials. In 2017, under the Trump Administration, the use of these sanctions, scaled up under the “maximum pressure” campaign, aimed at causing enough pain among the Venezuelan population to force a change of government. Far from the expected outcome, Venezuela found creative ways to resist what has been in fact a blockade and responded to the illegality of US “sanctions” by creating a legal instrument known as the Anti-Blockade Law to defend Venezuela’s economy and sovereignty.

In order to grasp the magnitude of the blockade against Venezuela, we must understand that it is one of the top five countries under US “sanctions”, with over 400 government measures. Over $7 billion in Venezuelan assets abroad have been frozen — 31 tonnes of Venezuelan gold lie still in the Bank of England and Venezuela’s oil subsidiary in the United States, Citgo, is no longer under Venezuelan control. At least 157 persons have been personally targeted, along with 153 businesses, some state-owned. Venezuela’s oil tankers and other ships have been targeted, as well as the national airline, which conducted flights during the pandemic to repatriate Venezuelans living under harsh economic conditions abroad. Currently, Venezuela has no access to the SWIFT mechanism, the commercialisation of Venezuelan oil and gold has been banned, and Venezuela cannot renegotiate or restructure its debt. Shipments to Venezuela and their contents have been seized by US authorities and there is a ban on trading for Venezuela’s subsidized food programme, known as CLAP. Imports, from raw materials to fertilisers and spare parts to items needed guarantee the normal functioning of basic public services such as water, electricity, waste disposal, and telecommunications have also been impaired, according to Venezuelan diplomat and special envoy Alex Saab.

Furthermore, at the peak of the pandemic, despite having enough resources to pay for the vaccination of the entire population, Venezuela was not allowed to use its own money to purchase vaccines against Covid-19 because its accounts were blocked. Payments with funds that had not been blocked by the United States also stalled, as the bank transactions were halted with no other possible explanation besides the fact that it would have undermined the maximum pressure campaign. In essence, Venezuela was not only “sanctioned” or blocked. There was an outright persecution aimed at paralyzing the Venezuelan economy and pressuring the constitutional government of President Nicolas Maduro to the point of collapse.

Faced with the necessity of addressing the economic crises set off by the effects of unilateral coercive measures, the Venezuelan government found a way to fight back against illegality, by approving and enacting an innovative piece of legislation that allowed the government to have tools to guarantee its economic defence. On October 12, 2020, the Constitutional Anti-Blockade Law for National Development and the Guarantee of Human Rights, proposed by President Maduro, was approved by the National Constituent Assembly and will be in effect as long as the blockade or the effects of the blockade persist. 

As a Constitutional Law, it contains the highest rank according to Venezuela’s legal system, above lower rank dispositions, including organic laws, which makes it a robust legal instrument. It essentially seeks to defend Venezuela’s sovereignty, its resources and the rights of the Venezuelan people by allowing for measures that promote productive investment in strategic sectors and the participation of new actors in commercial and industrial activities of national interest. This strategy contemplates targeted and sectorial measures that grant capabilities and flexibilities so that productive alliances and investments can take place, increasing the country’s capacity to raise incomes and generate social well-being. The implementation methodology relates projects with ideal executioners, according to their technical and economic capabilities, as well as their willingness to participate in determined sectors. The new legal framework allows for processes to be expedited and the nation’s assets to be protected. Sectors such as basic industries, oil, gas, petrochemicals, mining, agriculture, agro-industry, the digital economy, and tourism are among those offering potential and advantages in Venezuela’s economy.

The Anti-Blockade Law established the International Centre for Productive Investment, which manages the portfolios of projects and potential allies, evaluates their viability and suitability, accompanies its execution and reports recommendations to the President, to the State Council, and to the country, in accordance to the Law and Constitution. Under this law, Venezuela now has a dynamic legal framework that allows the national government to take immediate measures to compensate the risks and damages caused by the unilateral coercive measures. The Anti-Blockade Law also contains specific dispositions that allow for adequate constitutional controls to be adapted to the conditions imposed by the blockade. This guarantees both the nation’s assets as well as the private investment. 

Dividends and revenue generated for the State by the projects implemented under the Anti-Blockade law are destined to protect Venezuela’s model for social inclusion. For this purpose, these funds must be used primarily to: 

• Develop a system of compensation for workers’ salaries in real terms, to guarantee the income of working families. 
• Invest in the recovery and retention of workers’ benefits. The government can create mechanisms to restore the value of labour benefits.
• Strengthen the social protection system and policy by improving food subsidy programmes such as “CLAP”, strengthen the public healthcare system, and strengthen all social programmes (education, housing, etc.
• Recover public services and public infrastructure affected by the illegal “sanctions” that have cut investment or impeded reparations or maintenance. This is a particularly important sector for investment.
• Promote the nation’s productive capabilities, those of the basic industries and of 17 areas identified as “engines” for the economy, making way for a general economic recovery in the country and selective import substitution. 
• Promote science, technology, and innovation in order to strengthen a new and sovereign development model. 

The Anti-Blockade Law also created the National Observatory on Unilateral Coercive Measures, with a real-time registry of the illegal sanctions, their impact and the evolution of the ongoing processes, allowing for the country to be informed and for the government to adapt and optimise policies in a timely manner. Likewise, since one of the deliberate effects generated by the coercive measures is the harassment and extortion of actors that engage with the Venezuelan government, the Anti-Blockade Law has confidentiality provisions aimed at protecting investors from these unilateral coercive measures. Venezuela also commits to supporting legal actions in defence of partners that may be threatened by the coercive measures. 

Under the Law, strategic partners for the government will not only come from the private sector, but also from organised communities. This means that communes, grassroots organising structures which under the blockade were forced to skilfully enhance their productive capabilities, can now also partner with the State, to take on important production projects. 

The Anti-Blockade Law has been key to Venezuela’s path to recovery. Even analysts that have made Venezuela’s economic failure part of their agenda have had to recognise Venezuela’s economic growth this past year and how the country has overcome hyperinflation. Sound and creative policies within a framework designed for protecting growth and social investment without sacrificing sovereignty, is testament to the resilience of the Venezuelan people and its government against the arbitrary and illegal imposition of coercive measures.