No Plan For War In Guyana

Tensions are mounting over the Essequibo region, which is controlled by Guyana but claimed by Venezuela as part of its legitimate territory. The dispute dates back to the 19^th century, and now involves abundant oil deposits in the Stabroek offshore block.

On December 3^rd, Venezuelans will be voting in a ‘consultive referendum’ on how the government should press its claim on the Essequibo territory. Guyana has requested the International Court of Justice (ICJ) stop the vote from taking place, though it is not clear how that could be done.

There will be five questions on the ballot paper. Question 3 asks whether the jurisdiction of the ICJ over the dispute should be recognised. The last, most controversial question is if Venezuela’s government should set up the administration of an ‘Essequibo state’—to exist alongside the other 23 in the country—and grant Venezuelan citizenship to all its residents.

Many commentators have called the referendum an attempt to rally support around the government on a national issue, where virtually all Venezuelans agree. It was announced soon before the primaries for the Plataforma Unitaria—the largest opposition alliance. It would also aim to break the opposition with the dilemma of supporting or boycotting the vote. For President Nicolas Maduro, it would be a good opportunity to shore up support in the run-up to elections in 2024.

Now, in the US there are increasing fears that there could be a military escalation. However, this is grounded in a perspective of President Maduro as a rogue actor, and not on reality. There is no evidence of military preparations, while there are many deterrents and incentives on all sides to keep the peace.

The tensions also come at a crucial point for Venezuela. The government is in the process of regaining recognition from the US and its allies; sanctions are being progressively lifted; and Western corporations and oil traders trickling back into the Venezuelan market.

Breaking the opposition in two

In Venezuela’s once united opposition, the referendum has become a divisive issue, although all claim that the Essequibo should be part of Venezuela. Many see it as a proxy vote on President Maduro; if the turnout is high, it will be a success for him, whereas if he fails to mobilise voters, it will look as if he has little support to count on.

The main opposition leader since the primaries, Maria Corina Machado, has denounced the vote and said Venezuela should take the fight to the ICJ instead. However, in December 2020 she had said that the court was not competent to rule on the dispute. The dilemma presented by the consultation could take a toll on her support.

Machado’s stance has also led to praise from Guyana, which could backfire on her. Vice President Bharrat Jagdeo hailed Machado on social media for saying that the referendum should be suspended. This has been easily picked up by her opponents to criticise her.

The leadership committee of the Plataforma Unitaria realised it was in a tough position. In a statement, they declared that they would let their supporters individually choose whether they would vote. Key opposition figures such as Henrique Capriles and Manuel Rosales have come out in support of the referendum; the hardline opposition has branded such leaders as sell-outs.

The Maduro administration also hopes to undermine its domestic rivals with the Essequibo, knowing the position of the US and the OAS—indispensable backers of the opposition. Washington DC is a staunch defender of Georgetown in the dispute, and even has military cooperation agreements with Guyana. Chavistas are fully aware that this will discredit the opposition in the public’s eyes.

A very brief history, and some oil

The dispute traces its origins to the 19^th century. The territory was once considered part of the Spanish province of Venezuela, although the sparsely populated land was of little interest to empires. The Essequibo River was then considered the border between the Spanish colony and British Guyana. After Venezuela became independent, came the gold rush. British explorers and settlers made inroads on the western shore of the Essequibo River, the now-disputed land.

In 1899, a tribunal of arbitration in Paris awarded Britain with 90% of the land it claimed, moving the border westward. The US attended on behalf of Venezuela, invoking the Monroe Doctrine. In 1966, Venezuela, Britain and soon-to-be independent Guyana signed the ‘Geneva Agreement’, which declared the Paris award as ‘null and void’.

The conflict has resurfaced and subdued many times since. For instance, under then-president Hugo Chavez, cooperation with Guyana and other CARICOM countries was prioritised over pressing the claim. However, a recent grievance by Venezuela has been that Guyana is exploiting the natural resources of the territory—and its sea—while refusing to resolve it.

The most important resource endowment of the Essequibo region is the oil found in its territorial waters. In the Stabroek Block, since 2015, exploration missions have found more than 11 billion barrels of recoverable oil and gas.

Overnight, the wealth found underwater has turned Guyana from one of the poorest to one of the richest, in terms of Gross Domestic Product per capita. The measure has practically tripled since 2020, to $20,560. Indeed, the new windfall is yet to trickle down; in the most recent estimates nearly half of the population is under the $5.5 per day poverty line.

The conflict also ties in with the rivalry between ExxonMobil
XOM
and the Venezuelan government, since nationalisation in 2007. The US oil giant is the key player in Guyana’s oil boom, alongside China’s CNOOC. While the partnership is almost equal on economic terms, it is the US that is ready to intervene with its military. In much of the wording by Caracas, Guyana is painted as a ‘colony’ of ExxonMobil and the ‘US empire’.

Why conflict is not likely

First and foremost, the Venezuelan government is not signalling that it wants to go to war. Instead, it is focused on rallying support in the run-up to an electoral year. Instead of making grandiose shows of its military forces on the border, it has been publishing videos of columns of supporters in cities across Venezuela.

Most of the talk of war comes from what US commentators are considering, with little connection to the ground. Americans are notorious for their handwringing. Warmongers and sensationalists are already claiming that there are clashes, sharing an old video of Colombian guerrillas—it is easy to fool gringos who cannot tell accents apart.

Now with any border dispute, there is a risk of small clashes and escalation that needs to be taken into account. Yet, there are grounds to believe that the parties are neither willing nor prepared to go to war.

Both countries have a strong incentive for stability in the current context, and they share many partners. They are at key moments in vying to attract foreign investment from China, the US, and Europe. The stakes are higher with Venezuela, which is negotiating the removal of sanctions from Washington DC and Western allies.

Notably, Chevron
CVX
is ramping up its oil production in Venezuela, alongside European firms such as Maurel et Prom, Repsol and Eni. Simultaneously, it has recently acquired Hess, obtaining its stake in Guyana’s Stabroek Block. Various Chinese oil and gas firms are heavily invested in the two South American countries, while Beijing has different cooperation agreements with both Caracas and Georgetown.

President Maduro went on tour around China this September, preceded by his oil minister and his vice president. At the visit, China upgraded its relationship with Venezuela to an ‘all weather’ partnership. Just this week, Carabobo state governor Rafael Lacava has been in Shanghai, further strengthening ties between the two countries. A clash risks upsetting the upgrade.

Guyana is also firmly supported by the CARICOM, and can even count on good relations with Cuba, a close friend of Venezuela. However, many Caribbean states have also been friendly to the governments of Hugo Chavez and Maduro. In 2019, the US tried to make the Organisation of American States approve a joint military intervention in Venezuela, and it was ultimately the Caribbean block that prevented its approval. Their stand avoided a catastrophic war for the region. Nonetheless, in this dispute, they clearly side with Georgetown.

The towering argument against war is the US’s stance of supporting Guyana. Venezuela cannot count on a nuclear arsenal to deter direct involvement. The Venezuelan military has also suffered considerably during the recent economic crisis. It would need substantial investments in infrastructure, equipment, logistics, and training before embarking on an inter-state conflict.

While both sides have set up military camps near the border, it is important to point out the location. Guyanese President Irfaan Ali appeared near the northern edge, while Venezuelan military exercises have focused on the south. There are no indications that either side is amassing troops for a war. Instead, the Venezuelan defence ministry has said it is mobilising over 300,000 troops to defend the polling booths on December 3^rd, rather than positioning them on the border.