Venezuela’s President Hugo Chávez died on March 5, after a long period of illness. Below are some of the key points from our political outlook for Venezuela, as outlined in several recent articles in our online service:

• A new presidential election will be held within 30 days, and we expect Vice-President Nicolás Maduro, Chávez’s chosen successor, to win. His most likely opponent is Henrique Capriles Radonksi, who was defeated by Chávez last October. The opposition doesn’t really have time to find someone new.
• We expect Maduro to continue Chávez’s legacy of high social spending and interventionist economic policies.
• Social tensions will remain elevated, fuelled by a polarised electorate and political uncertainty.
• Now that Chávez is dead, we do not rule out internal fragmentation within the ruling Partido Socialista Unido de Venezuela (PSUV) party. This could see the military faction, led by National Assembly president Diosdado Cabello, seek to increase its influence, resulting in a destabilising power struggle.
• Chávez’s death will pave the way for the next president to gradually move away from his predecessor’s more hardline policies. In other words, there is scope for modest reform.

Opposition Has Its Work Cut Out

At this point, the opposition’s best bet is to mobilise as quickly as possible for the forthcoming presidential election. The opposition will need to work hard to bolster its support, given its heavy losses in last December’s regional elections. Beyond the presidential poll, the opposition will also be eyeing municipal elections, which are scheduled for July 14. Then, there will be legislative elections in 2015. This will be a key test for whether the opposition can win the presidency in 2019.

Overall, we expect Venezuela to remain unstable for some years to come.

Chávez’s Death Removes Key Ideological Pillar

Also significant is that Chávez’s death removes a key pillar of the global anti-imperialist left. Chávez provided strong support for left-wing leaders in Latin American countries such as Argentina, Bolivia, Cuba, Ecuador, Nicaragua, Peru, and elsewhere, and he forged ties with anti-American leaders such as Iranian President Mahmoud Ahmadinejad and Libya’s late Muammar Qadhafi. There are no obvious figures with Chávez’s ideological convictions, motivation, and experience to replace him.

Tags: Diosdado Cabello, Economy, global left, Henrique Capriles Radonski, Hugo Chavez, municipal elections, Nicolas Maduro, power struggle, presidential election, reform, Venezuela
Posted in: Business Environment, Emerging Markets, General, Latin America, Political Risk
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