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Canada’s Complicity in the Venezuela Crisis

By Amadeus Narbutt

This article was originally published in the Canadian Dimension.

The crisis in Venezuela has put the entire Latin American region on alert. The once booming petrostate was led by the leftist Hugo Chávez during a time known as the ‘pink tide’, when left-wing governments were elected on the back of anti-neoliberal protests across the continent in the 1990s and 2000s. While the pink tide receded in places like Ecuador and Brazil by the 2010s, it held firm in Venezuela, eventually culminating in a stagnant pool of corruption and authoritarianism under Chávez’s handpicked successor Nicolas Maduro.

Chávez’s modernization of Venezuela and the construction of a radically distributive welfare state was built on the back of Venezuela’s oil industry, which was responsible for 98 percent of export earnings and almost 50 percent of its gross domestic product (GDP). When oil prices dropped more than 70 percent between 2014 and 2016, Venezuela’s economy collapsed. Mired in falling oil production, shrinking GDP, soaring debt, hyperinflation, and growing autocracy, Venezuela now represents the largest humanitarian crisis in the Western Hemisphere. When Maduro was re-elected in the summer of 2018 in a vote widely perceived to be fraudulent, Juan Guaidó, the President of the National Assembly, declared himself interim President of Venezuela with the backing of the US.

Canada has involved itself in the crisis mainly through its co-founding and participation in the Lima Group. In doing so, Canada has touted its ‘value-oriented foreign policy’ and commitments to safeguarding and promoting democracy and human rights abroad. The purpose of the Lima Group is to support Guaidó’s aim of removing Maduro and to guarantee a peaceful transition to democracy in Venezuela “without the use of force”. However, the continued use and expansion of sanctions against Venezuela by the US has directly contributed to the suffering and degradation of the conditions of the Venezuelan people, and is considered illegal under international law.

Maduro’s administration is guilty of anti-democratic measures and human rights abuses, and he should be held responsible for his actions through democratic means and the restoration of the judicial process in Venezuela. Yet the actions of Canada, in coordination with the Lima Group, do not correspond to the purported aims of peaceful and diplomatic transition.

The Lima Group and Canada have acted in lockstep with the US and Juan Guaidó. Guaidó’s opposition have weaponized the economic misfortune of Venezuela with American-backed force as a way of furthering the country’s economic misery in order to foment an uprising against Maduro. As a member of the Lima Group, Canada is complicit in this exploitation of human suffering for the purposes of regime change, despite its lofty rhetoric about human rights and the protection of democracy.

Meanwhile, US efforts have recently expanded to a full economic embargo of Venezuela. While Canada has not yet pursued the same policy, Minister of Foreign Affairs Chrystia Freeland has stated that Canada was ‘examining’ a move to freeze all Venezuelan government assets.

Jean Galbraith of the University of Pennsylvania Faculty of Law describes the precise nature of the US sanctions against Venezuela through an examination of Executive Order 13808, outlining the particular targeting of financing for the Venezuelan government and its state-owned oil company Petroleos de Venezuela S. A. (PdVSA). Less than two weeks after enacting these measures, on September 5, 2017, the US and Canada formed an ‘association’ in order for the Canadian government to have the legal authority to implement corresponding sanctions through the Special Economic Measures Act, which stipulates that Canada may apply sanctions when “an international organization of states or association of states, of which Canada is a member, has made a decision or a recommendation or adopted a resolution calling on its members to take economic measures against a foreign state”. Unable to find unanimity in other forums like the Organization of American States (OAS), the US and Canada formed their own temporary group for the specific purpose of justifying these sanctions.

The outcomes of these sanctions have been nothing short of disastrous. Former UN Rapporteur Alfred de Zayas released a devastating report on the humanitarian situation in Venezuela, in which he criticized the role of the military-industrial complex, transnational corporations, and international financial interests in pursuing unilateral economic warfare against Venezuela, with especially dire consequences for the poor. The results of these sanctions have been so severe that de Zayas recommended invoking Article 96 of the United Nations (UN) Charter to request an opinion on the case from the International Court of Justice (ICJ) as to whether the sanctions constitute crimes against humanity.

Economists Mark Weisbrot and Jeffrey Sachs of the Center for Economic and Policy Research (CEPR) and Columbia University, respectively, echo these concerns. They have highlighted the particularly devastating impacts the sanctions have had on health and human well being in Venezuela, concluding that they have resulted in an estimated 40,000 deaths from 2017-2018. Further, scholarly work by the Peterson Institute for International Economicsattributes only a 34 percent success rate to sanctions in diplomatic efforts, revealing the dubious role they play in successfully advancing peace.

The purpose of these sanctions is clear: to weaponize the suffering of Venezuela’s working class in order to further delegitimize the Maduro government and encourage a revolt of disaffected citizens and military personnel. The sanctions have also obstructed Venezuela’s access to the international financial system, which gives the country no option to restructure its debt or remedy the economic crisis and alleviate rising poverty and food insecurity. The utilization of important financial instruments has become nearly impossible as a result of the sanctions, and the leaders of the opposition have even attempted to block the Maduro government from accessing its own gold reserves abroad.

If Canada was truly interested in the alleviation of poverty and the promotion of human rights in Venezuela, its goal should be the restoration of effective governance, not the antagonistic diffusion of suffering through financial and economic warfare.

Canada’s motivations in Venezuela are likely more self-interested than the ‘value-oriented’ rhetoric the Trudeau government employs. For instance, global financial actors have an interest in seeing the end to Maduro’s regime due to its continued policy of nationalization of the natural resources sector. When Chávez nationalized the gold mining industry in Venezuela, it was publicly reported as a threat to Canadian interests. Now, the Canadian mining industry has billions of dollars worth of interest in seeing it privatized.

Examples of the struggle between Venezuelan nationalization and Canadian corporate interests can be seen in court cases such as Vanessa Ventures v. Bolivarian Republic of Venezuela and Gold Reserves Inc. v. Bolivarian Republic of Venezuela, where Canadian corporations sued the Venezuelan government for hundreds of millions of dollars in response to asset seizure. Further evidence of global capital’s role in the push for regime change in Venezuela can be seen in the Inter-American Development Bank (IDB), which has confidential plans for a $58 billion recovery fund for Venezuela, but only after regime change occurs. Former chief economist and recent consultant for IDB, Richard Hausmann, has been designated by Juan Guaidó as his coordinator of economic advisors. Hausmann has previously been named as one of the “IESA Boys”, a group of neoliberal economists from the Instituto de Estudios Superiores de Administración, a private university in Caracas. The nickname harkens back to the infamous Chicago Boys, who played a leading role in orchestrating the US-backed coup against democratically elected socialist Salvador Allende in Chile in 1973. Last year, Hausmann published an article entitled “D-Day Venezuela”, pleading for military intervention in the country and documenting a vision of neoliberal restructuring.

Should Canada wish to conduct foreign policy in a manner that is consistent with its rhetoric, it must commit to genuine humanitarian actions that do not restrict the government’s ability to provide aid to its population. The lifting of harmful sanctions and the economic embargo should be a top priority to ensure that the Venezuelan people are no longer suffocated by financial restrictions placed on the Maduro government. Further, the involvement of corporate interests and figures like Hausmann, with deep ties to the opposition forces led by Guaidó, should be denounced as predatory and opportunist. Canada and the Lima Group’s support for Norway-backed peace talks should continue, and any further threats of military action by the US must be categorically condemned.

Canada, if it purports to stand for democracy and human rights abroad, would do well to understand that further escalation of the crisis in Venezuela — whether by economic warfare, the diplomatic recognition of rival factions, or threats of military force — will only lead to the further degradation of human rights. Venezuela is a deeply divided country. Though Maduro is hated by many, he still has a loyal base of support. Furthering suffering by the Venezuelan population due to harsh sanctions will not make these political divisions disappear. The solution must be a negotiated settlement among different political factions that respect democratic mandates, human rights, and sovereignty.

Amadeus Narbutt is a doctoral student in Political Science at York University and a Policy Analyst at the Institute for Peace & Diplomacy. He studies the political economy of Latin America, American foreign policy, and neoliberalism. Follow him on Twitter @amadeusnarbutt.

Panel 4: Pathways to Manage Non-Proliferation in the Middle East (4:30 PM - 5:45 PM ET)

The Western powers have failed to effectively manage the increasing threat of proliferation in the Middle East. While the international community is concerned with Iran’s nuclear program, Saudi Arabia has moved forward with developing its own nuclear program, and independent studies show that Israel has longed possessed dozens of nuclear warheads. The former is a member of the treaty on the Non-Proliferation of Nuclear Weapons (NPT), while the latter has refused to sign the international agreement. 

On Middle East policy, the Biden campaign had staunchly criticized the Trump administration’s unilateral withdrawal from the Joint Comprehensive Plan of Action (JCPOA), more commonly known as the Iran Nuclear Deal and it has begun re-engaging Iran on the nuclear dossier since assuming office in January 2021. However, serious obstacles remain for responsible actors in expanding non-proliferation efforts toward a nuclear-free zone in the Middle East. 

This panel will discuss how Western powers and multilateral institutions, such as the IAEA, can play a more effective role in managing non-proliferation efforts in the Middle East.  

Panelists:

Peggy Mason: Canada’s former Ambassador to the UN for Disarmament

Mark Fitzpatrick: Associate Fellow & Former Executive Director, International Institute for Strategic Studies (IISS)

Ali Vaez: Iran Project Director, International Crisis Group

Negar Mortazavi: Journalist and Political Analyst, Host of Iran Podcast

David Albright: Founder and President of the Institute for Science and International Security

 

Closing (5:45 PM – 6:00 PM ET)

Panel 3: Trade and Business Diplomacy in the Middle East (3:00 PM - 4:15 PM ET)

What is the current economic landscape in the Middle East? While global foreign direct investment is expected to fall drastically in the post-COVID era, the World Bank reported a 5% contraction in the economic output of the Middle East and North African (MENA) countries in 2020 due to the pandemic. While oil prices are expected to rebound with normalization in demand, political instability, regional and geopolitical tensions, domestic corruption, and a volatile regulatory and legal environment all threaten economic recovery in the Middle East. What is the prospect for economic growth and development in the region post-pandemic, and how could MENA nations promote sustainable growth and regional trade moving forward?

At the same time, Middle Eastern diaspora communities have become financially successful and can help promote trade between North America and the region. In this respect, the diaspora can become vital intermediaries for advancing U.S. and Canada’s business interests abroad. Promoting business diplomacy can both benefit the MENA region and be an effective and positive way to advance engagement and achieve foreign policy goals of the North Atlantic.

This panel will investigate the trade and investment opportunities in the Middle East, discuss how facilitating economic engagement with the region can benefit Canadian and American national interests, and explore relevant policy prescriptions.

Panelists:

Hon. Sergio Marchi: Canada’s Former Minister of International Trade

Scott Jolliffe: Chairperson, Canada Arab Business Council

Esfandyar Batmanghelidj: Founder and Publisher of Bourse & Bazaar

Nizar Ghanem: Director of Research and Co-founder at Triangle

Nicki Siamaki: Researcher at Control Risks

Panel 2: Arms Race and Terrorism in the Middle East (12:00 PM - 1:15 PM ET)

The Middle East continues to grapple with violence and instability, particularly in Yemen, Syria and Iraq. Fueled by government incompetence and foreign interventions, terrorist insurgencies have imposed severe humanitarian and economic costs on the region. Meanwhile, regional actors have engaged in an unprecedented pursuit of arms accumulation. Saudi Arabia and the United Arab Emirates have imported billions of both Western and Russian-made weapons and funded militant groups across the region, intending to contain their regional adversaries, particularly Iran. Tehran has also provided sophisticated weaponry to various militia groups across the region to strengthen its geopolitical position against Saudi Arabia, UAE, and Israel. 

On the other hand, with international terrorist networks and intense regional rivalry in the Middle East, it is impractical to discuss peace and security without addressing terrorism and the arms race in the region. This panel will primarily discuss the implications of the ongoing arms race in the region and the role of Western powers and multilateral organizations in facilitating trust-building security arrangements among regional stakeholders to limit the proliferation of arms across the Middle East.

 

Panelists:

Luciano Zaccara: Assistant Professor, Qatar University

Dania Thafer: Executive Director, Gulf International Forum

Kayhan Barzegar: Professor and Chair of the Department of Political Science and International Relations at the Science and Research Branch of Azad University

Barbara Slavin: Director of Iran Initiative, Atlantic Council

Sanam Shantyaei: Senior Journalist at France24 & host of Middle East Matters

Panel 1: Future of Diplomacy and Engagement in the Middle East (10:30 AM-11:45 AM ET)

The emerging regional order in West Asia will have wide-ranging implications for global security. The Biden administration has begun re-engaging Iran on the nuclear dossier, an initiative staunchly opposed by Israel, while also taking a harder line on Saudi Arabia’s intervention in Yemen. Meanwhile, key regional actors, including Qatar, Iraq, and Oman, have engaged in backchannel efforts to bring Iran and Saudi Arabia to the negotiating table. From a broader geopolitical perspective, with the need to secure its energy imports, China is also expected to increase its footprint in the region and influence the mentioned challenges. 

In this evolving landscape, Western powers will be compelled to redefine their strategic priorities and adjust their policies with the new realities in the region. In this panel, we will discuss how the West, including the United States and its allies, can utilize multilateral diplomacy with its adversaries to prevent military escalation in the region. Most importantly, the panel will discuss if a multilateral security dialogue in the Persian Gulf region, proposed by some regional actors, can help reduce tensions among regional foes and produce sustainable peace and development for the region. 

Panelists:

Abdullah Baabood: Academic Researcher and Former Director of the Centre for Gulf Studies, Qatar University

Trita Parsi: Executive Vice-President, Quincy Institute for Responsible Statecraft

Ebtesam Al-Ketbi: President, Emirates Policy Centre​

Jon Allen: Canada’s Former Ambassador to Israel

Elizabeth Hagedorn: Washington correspondent for Al-Monitor

Panel 4: Humanitarian Diplomacy: An Underused Foreign Policy Tool in the Middle East (4:30 PM - 5:30 PM ET)

Military interventions, political and economic instabilities, and civil unrest in the Middle East have led to a global refugee crisis with an increasing wave of refugees and asylum seekers to Europe and Canada. Moreover, the COVID-19 pandemic has, in myriad ways, exacerbated and contributed to the ongoing security threats and destabilization of the region.

While these challenges pose serious risks to Canadian security, Ottawa will also have the opportunity to limit such risks and prevent a spillover effect vis-à-vis effective humanitarian initiatives in the region. In this panel, we will primarily investigate Canada’s Middle East Strategy’s degree of success in providing humanitarian aid to the region. Secondly, the panel will discuss what programs and initiatives Canada can introduce to further build on the renewed strategy. and more specifically, how Canada can utilize its policy instruments to more effectively deal with the increasing influx of refugees from the Middle East. 

 

Panelists:

Erica Di Ruggiero: Director of Centre for Global Health, University of Toronto

Reyhana Patel: Head of Communications & Government Relations, Islamic Relief Canada

Amir Barmaki: Former Head of UN OCHA in Iran

Catherine Gribbin: Senior Legal Advisor for International and Humanitarian Law, Canadian Red Cross

Panel 3: A Review of Canada’s Middle East Engagement and Defense Strategy (3:00 PM - 4:15 PM ET)

In 2016, Canada launched an ambitious five-year “Middle East Engagement Strategy” (2016-2021), committing to investing CA$3.5 billion over five years to help establish the necessary conditions for security and stability, alleviate human suffering and enable stabilization programs in the region. In the latest development, during the meeting of the Global Coalition against ISIS, Minister of Foreign Affairs Marc Garneau announced more than $43.6 million in Peace and Stabilization Operations Program funding for 11 projects in Syria and Iraq.

With Canada’s Middle East Engagement Strategy expiring this year, it is time to examine and evaluate this massive investment in the Middle East region in the past five years. More importantly, the panel will discuss a principled and strategic roadmap for the future of Canada’s short-term and long-term engagement in the Middle East.

Panelists:

Ferry de Kerckhove: Canada’s Former Ambassador to Egypt

Dennis Horak: Canada’s Former Ambassador to Saudi Arabia

Chris Kilford: Former Canadian Defence Attaché in Turkey, member of the national board of the Canadian International Council (CIC)

David Dewitt: University Professor Emeritus, York University

Panel 2: The Great Power Competition in the Middle East (12:00 PM - 1:15 PM ET)

While the United States continues to pull back from certain regional conflicts, reflected by the Biden administration’s decision to halt American backing for Saudi Arabia’s intervention in Yemen and the expected withdrawal from Afghanistan, US troops continue to be stationed across the region. Meanwhile, Russia and China have significantly maintained and even expanded their regional activities. On one hand, the Kremlin has maintained its military presence in Syria, and on the other hand, China has signed an unprecedented 25-year strategic agreement with Iran.

As the global power structure continues to shift, it is essential to analyze the future of the US regional presence under the Biden administration, explore the emerging global rivalry with Russia and China, and at last, investigate the implications of such competition for peace and security in the Middle East.

Panelists:

Dmitri Trenin: Director of Carnegie Moscow Center

Joost R. Hiltermann: Director of MENA Programme, International Crisis Group

Roxane Farmanfarmaian: Affiliated Lecturer in International Relations of the Middle East and North Africa, University of Cambridge

Andrew A. Michta: Dean of the College of International and Security Studies at Marshall Center

Kelley Vlahos: Senior Advisor, Quincy Institute

Panel 1: A New Middle East Security Architecture in the Making (10:30 AM -11:45 AM ET)

The security architecture of the Middle East has undergone rapid transformations in an exceptionally short period. Notable developments include the United States gradual withdrawal from the region, rapprochement between Israel and some GCC states through the Abraham Accords and the rise of Chinese and Russian regional engagement.

With these new trends in the Middle East, it is timely to investigate the security implications of the Biden administration’s Middle East policy. In this respect, we will discuss the Biden team’s new approach vis-à-vis Iran, Yemen, Saudi Arabia, and Israel. The panel will also discuss the role of other major powers, including China and Russia in shaping this new security environment in the region, and how the Biden administration will respond to these powers’ increasing regional presence.

 

Panelists:

Sanam Vakil: Deputy Director of MENA Programme at Chatham House

Denise Natali: Acting Director, Institute for National Strategic Studies & Director of the Center for Strategic Research, National Defense University

Hassan Ahmadian: Professor of the Middle East and North Africa Studies, University of Tehran

Abdulaziz Sagar: Chairman, Gulf Research Center

Andrew Parasiliti: President, Al-Monitor