On the Northern Coast of Latin America a conflict that stretches back to the Age of Discovery has burst back into life. Venezuelan President Nicolas Maduro has called for and won a referendum on whether Venezuela should annex the Guyanese province of Essequibo. Guyana has called for aid from the International Court of Justice (ICJ) and the United States for support in defending its territory. The contested region is a sparsely populated and mountainous region, which crucially is the home of 11.4 billion barrels of oil which has transformed Guyana into one of the fastest growing economies in the world. Venezuela’s ignition of this conflict has multiple causes, some short term and easy to see, some hidden in the fog of history. The dispute was likely triggered by the unpopularity of the Maduro regime; the referendum designed to discredit his political opponents and create a swell of patriotic support for his government. However the feud over the region has a long and convoluted history. Venezuela’s position was exacerbated in 2015 by the discovery of oil in the Stabroek Block off the coast of Essequibo. What was once a mostly symbolic conflict fuelled by resentment and patriotism is now a mortal threat to Venezuela’s last remaining trump card, its energy industry. The rise of Guyana at the expense of Venezuela could leave it as a true pariah state, alienating it from its Chinese allies, and collapsing the Maduro regime. The historical complexities and the nebulous threats this dispute poses, make it a very dangerous background for a game of brinkmanship.
Current Situation
On the 4th of December 2023 the Venezuelan people voted in favour of a consultative referendum on whether to annex the province of Guayana Essequibo in direct contravention of a ruling by the ICJ. Subsequently, Maduro has doubled down on his position by provocatively giving licences to Venezuelan companies to begin resource extraction in Essequibo. The referendum has two purposes, one domestic and one international. Domestically it was designed to consolidate Maduro’s position as head of the Chavist regime, and internationally it was to protect Venezuela’s regional position as China’s primary ally and as the major oil producer in Latin America. Guyana has responded by appealing to the United States and the global community for support. Maduro and Guyanese President Irfaan Ali met in St Vincent and the Grenadines on December 14th to discuss a resolution to the issue; mediated by President Lula da Silva of Brazil, it yielded a commitment to not use force in the dispute. However it did not address the claims made by Venezuela, and the failure to delegitimize them makes this agreement fairly meaningless.
Venezuelan Domestic Politics
In October 2023 Maduro and his domestic opposition signed the ‘Barbados Agreement’, mediated by Norway and encouraged by US intimations that it would reduce sanctions on Venezuela’s economy. Under the terms of the deal there would be ‘free and fair elections’ in 2024, practically speaking, without the usual subversion tactics by the government. However, Maduro was forced to take this step owing to the declining legitimacy of his Government in the face of multiple political and socio-economic crises. So while it was ostensibly progress in the right direction, it was in fact an internal threat to the Chavist regime. Maduro’s rationale for making the deal was to aid the Venezuelan economy by reducing US sanctions, and to improve his domestic political situation by providing the illusion of democracy. What has really happened is that Maduro has created a conflict to distract the Venezuelan people from his Government's failings and refocus the election on this issue.
By placing this border dispute at the heart of the election, Maduro can force his opponent - María Corina Machado - to either support his government or appear unpatriotic, and through her actions, and those of those around her, then use the courts to remove her as a candidate. Disqualifying candidates is a practised tactic of the Chavist government, and indeed many authoritarian states. The political implications in Caracas have been the primary focus of most analysts at the expense of the geopolitical risks and while a direct invasion is unlikely, the way we understand war has been changing in the last few years, and the history of the dispute is critical to understand the grievances fuelling it, and why there is a risk of escalation.
Colonial History
The border dispute between Venezuela and Guyana is defined by the legacy of Colonialism. In 1814 the Convention of London between Great Britain and the Netherlands settled several territorial disputes arising from the Napoleonic Wars in the Caribbean and Southeast Asia, pertinently ceding the territory West of the Essequibo River to the British Empire. On the other bank of the river lay the Spanish colony of Venezuela, however this was in practice a more complicated border due to the presence of British settlers. As Britain consolidated its territory, revolution was sweeping across Latin America under the leadership of the Venezuelan patriot Simon Bolivar. Bolivar formed the nation of Gran Colombia from newly liberated Venezuela, Ecuador, Colombia and Peru, throwing off the Spanish shackles. However after Bolivar’s death factionalism destroyed his nation, with Gran Colombia disintegrating into different states a year later in 1831, the same year Britain formalised the colony of British Guiana. Bolivar’s legacy of anti-colonial violence remains a powerful force in Venezuelan politics.
The resulting states, Venezuela, and the British Guiana colony, had very different interpretations of the border, exacerbated by the rich mineral wealth of the region. However it only came to a head in the 1890s when the United States became involved under the Monroe Doctrine, and in 1897 an international tribunal of judges was formed in Paris; two American, two British, and one Russian. This tribunal’s decision is at the core of Venezuela’s argument, since it awarded the territory to the British. The fact that it was composed of colonial powers imposing a decision on a nation that had won its independence, combined with the alleged corruption of the Russian judge, created a grievance still present in Venezuelan politics. British influence over the Russian judge is the cornerstone of Venezuela’s rejection of the decision. The sense of betrayal by the global community still informs Venezuela’s rejection of international arbitration today.However the aggressiveness of the United States’ protection of its interest under the aegis of the Monroe Doctrine, as well as the overwhelming military strength of the British Empire led Venezuela to accept the ruling in 1905.
In 1966, the decolonisation of the British Empire provided a new opportunity for Venezuela to stake its claim to the territory. It appealed unsuccessfully to the UN on the basis of the illegitimacy of the Paris Tribunal. Venezuela’s lack of success in global forums led it to consider military action, a rejection of the rules-based system that is still present in Venezuelan policy particularly on the Essequibo issue. The CIA was concerned about a Venezuelan invasion in 1969 using Amerindian rights as a pretext, this also accompanied a change of regime in Venezuela; from Accion Democrativa to the Social Christian party. The CIA report stated that while Venezuela was aware of the likelihood of an ‘adverse reaction’ in the global community, there was confidence that a combined political and military approach would not lead to intervention by either the US, UN or Organisation of American States (OAS). This can be explained by the fact that Venezuela was then an ally of the US, and Guyana was feared to be a potential target for communist takeover. However, a series of military factors and the threat of American hyper-interventionism stayed Venezuela’s hand.
These historical factors demonstrate that the Essequibo issue is one which Venezuelan governments, regardless of political allegiance or ideology, will ignite given the opportunity. While the current conflict is not a colonial dispute, it is an important part of the grievance within Venezuelan politics, and the broader geopolitics of the region. Not for nothing is the oilfield at the heart of the dispute named after the former President of the Dutch West India Company.
Recent History
The Chavist regime has used the Essequibo dispute to shore up domestic support in the past. In 2006, President Hugo Chavez announced the addition of an eighth star to the Venezuelan flag representing the territory of ‘Guayana’ which had been claimed by Simon Bolivar. Chavez’s motivation was political, this act directly preceded the first presidential elections since Chavez survived a recall vote in 2004. Conjuring up the spectre of Bolivar was a very specific message to establish historical legitimacy for the regime. The same language has been used today by Maduro.
Other incidents involving Essequibo, and the creation of an external enemy, line up with instability in Caracas. In 2019, Maduro’s government appeared on the verge of collapse, with the US stepping up its sanctions regime, as well as most states aligned with international bodies recognising Maduro’s opposition, Juan Guiadó, as the legitimate leader of Venezuela after the 2018 elections. Around this time, Venezuela increased its naval operations against Guyana, and increased its anti-ICJ rhetoric. These rejections of the rules-based system pushed Venezuela to develop even closer ties with nations like Russia, China and Iran than it had already cultivated.
Venezuela’s strategic interests have also played a role in this issue historically. In 2013 when the Venezuelan Navy stopped a Guyanese ship surveying the oil fields offshore, the language was similarly delegitimising, calling Guyana an heir to the British Empire. There have been a number of incidents in recent years, whereby Venezuela used its naval strength to intimidate ships searching for oil in disputed waters. These provocations by the Venezuelan Government led to the lawsuit filed by Guyana in 2018 with the ICJ. Maduro stated at the time that Venezuela would not recognise the ICJ’s ruling on the matter and continued to issue directives and make claims on the disputed territories. In December 2018, the day after ‘vote of no confidence’ in then President of Guyana, David A. Granger, the Venezuelan Navy forced two ships conducting seismic work for Exxon in Guyanese waters to flee. The Essequibo issue is not always about domestic political benefit but also the exploitation of circumstance, this suggests there is more to this conflict than just Maduro maintaining his grip on power in Caracas. It suggests a very real fear in Caracas that the oil discoveries in Guyana will radically alter the geopolitics of the region.
The Oil Problem
Guyana’s burgeoning oil industry is a threat to Venezuela. China’s involvement with the Guyanese oil project, as well as the superior quality of the oil in the Stabroek Block, presents a strategic problem for Caracas. Guyanese oil is of the sweet light variety (similar to that found in Texas), as opposed to the extra heavy crude found in Venezuela, meaning that not only is it easier to export, but it will be at a premium on the market. Venezuela’s oil is tricky to refine, and while its partners, including China, have the capacity to refine it, a Guyanese-Chinese partnership would leave Venezuela further isolated. This has already begun with CNOOC holding a 25% partnership in the Exxon project in the Stabroek block. This particular play for Essequibo could be as much of a desperation move in terms of Maduro’s government on the global stage as much as it is at home in Caracas. This is because Venezuela’s oil production has fallen from its peak of 3.2m barrels per day in 2000 to 735k per day in September 2023, whereas Guyana is now producing 500k barrels per day and is predicted to be producing 1.2m barrels per day in the coming years from a total reserve of 11.4 billion. While this is still less than the proven reserves in Venezuela, it represents a threat to the Venezuelan economy, since 150k barrels of its oil goes to the United States even under sanctions, if this were to be replaced by the new Guyana project the Venezuelan economy would only get worse, particularly as the largest portion of its oil goes to China at low prices to pay down its national debt. The role of China in this region is important.
Chinese Involvement
The Caribbean is America’s backyard and it has long taken any threat to its dominance over the region very seriously. However since the Cold War China has long been engaged in so-called ‘softer forms’ of intervention across the globe, ranging from its own backyard in the South China Sea through Zaire and Angola, and even Guyana itself in the 1970s. The difference now is that we see an America that is less concerned with broader ideological threats in comparison with immediate geostrategic concerns. China began building its relationship with Venezuela in 1999 when Hugo Chavez became President of Venezuela. It was viewed as a fellow socialist state, likely to oppose American interests in the region and also held the largest proven oil reserves in the world, something that would help China to establish its own power base and diminish America’s hegemonic position. Venezuela was one of the first nations to be absorbed into the Maritime Silk Road project and China has assisted Venezuela in fields ranging from healthcare and infrastructure to security. As is common with Chinese assistance, there are now a myriad of strings tying Caracas to Beijing. However, China has also invested heavily in Guyana, not only in the Exxon project, but with broader economic assistance. Guyana joined the Maritime Silk Road project officially in July 2018, and the Belt and Road initiative (BRI) in July 2023; threatening Venezuela’s position as China’s regional bulwark.
China’s modes of control are very different to those of the US, reliant on economic and diplomatic support rather than boots on the ground. However, it is no less interventionist and exerts similar control over the target nation. In both Guyana and Venezuela we can see similar tactics, but at different stages of development. China’s position as patròn for these regional rivals places it in a difficult position, as it’s Venezuelan position is heavily reliant on Maduro’s regime rather than historical ties to the country. China’s leveraging of financial assistance ties it to leaders rather than nations, and has the potential to commit it to a regime that will do more harm than good to Chinese interests. The series of triggers for Venezuela’s referendum could include Guyana joining the BRI, where Maduro sensing the weakening of his alliance with China, is trying to force Beijing’s hand to commit to Caracas as their regional bulwark. This is particularly important for Maduro, as his security and economic strategies are heavily reliant on Chinese support. Any change to this situation could lead to the end of the Maduro regime, hence why brinkmanship with the US and Guyana is a move worth making, both on the domestic stage and the global one.
Prospects for War
The Venezuelan Military is heavily linked to two other nations besides China – Iran and Russia – both of which are experts at proxy and irregular warfare. Russia’s involvement is particularly interesting as the presence of Rosneft in the Venezuelan oil sector, and the Maduro regime’s rejection of the West makes it an important ally for Russia on the global stage. This sort of dyadic relationship outside of global norms is one of the factors that could lead to the escalation of this dispute. The coalition of Venezuela’s supporters is not a group that America can consider friends, and their increasing boldness globally, and presence locally, should be of great concern to American policymakers. The potential for warfare in this context is limited to either increased naval aggression in the Caribbean or irregular forces operating within the borders of Guyana to reduce government control over the region and legitimise Venezuela’s claim. The revival of the Amerindian pretext could offer Moreover the outright size of Venezuela’s military compared to Guyana’s is a classic case of capacity building by Venezuela’s allies. The combination of Chinese strategic interests in the region and American desire to see Venezuela and its oil reserves returned to the global community could also encourage PMC (Private Military Company) operations within Essequibo, for example to protect the mining and drilling operations that Maduro has given licences for in the region. It would also benefit Chinese interests to have the US distracted by a low level proxy war in its own backyard as a counter to US activities in the South China Sea. The American response to this dispute will be the defining factor as to if and how this conflict escalates.
The Monroe Doctrine
The Stabroek block discoveries have made Guyana a significant player in Latin American regional politics, as well as a nation with increasing importance to both the United States and China, we are likely to see a large degree of manoeuvring by both superpowers to assert themselves as the primary ally, though China’s ties to Venezuela have created an opportunity for the United States to invoke the ghosts of the Monroe Doctrine. The United States’ history of intervention in Latin America under the aegis of the Monroe doctrine is rooted in realism, the only consistency being the protection of American interests. The US has the opportunity to heavily support Guyana and position itself in such a way as to force China out of Latin American politics. This would be a return to Cold War era strategy where the US used active measures to preserve its interests, both economic and ideological, with a degree of ruthlessness that has not been present in the past few decades.
In 1969 President Nixon was told that there was no Venezuelan politician ‘willing or able to defuse the dispute with Guyana’, since there was a belief that military forces in Venezuela were attempting to force President-Elect Caldera’s hands. United States policy in Latin America during the Cold War revolved around ensuring the presence of compliant regimes either through covert action or offering military support to coups, with decisions made on the basis of leaders’ loyalty to the United States rather than popular support. Operation Brother Sam in 1964 was a US military operation to support the CIA’s efforts to remove Joao Goulart as the President of Brazil which involved a carrier group sitting off the coast of Sao Paulo threatening an amphibious landing. While this was never feasible, the American use of gunboat diplomacy during the Cold War tells us about the American attitude to threats to its dominance over the region. We can also use the Bay of Pigs invasion and the ousting of President Arbenz of Guatemala in 1954 as indicators of America’s willingness to use force to protect its interests as a form of modern Monroe Doctrine. However, these are primarily political solutions, rather than extended interventions. In Guyana in 1964, the CIA and MI5 collaborated to prevent Cheddi Jagan from taking power of an independent Guyana through a combination of covert action, propaganda and alteration of the political system.
In the modern era, the United States tends to use military cooperation and assistance with its allies, and place sanctions on those states it considers enemies. The Venezuelan sanction scheme is an example of this, which has had a catastrophic effect on the Venezuelan economy, as well as making it something of a pariah in the region. American SOUTHCOM exercises with nations like Colombia and Brazil are a way of demonstrating force in Latin America, but the Essequibo dispute will act as a test of US resolve in the region. The two prongs of American strategy will be to use Brazil as a proxy actor for diplomatic and military strategies, and, as they already have, utilise specialised American forces, such as the military assistance brigade, to reinforce Guyana. Brazil activated a mechanised cavalry regiment two years earlier than planned to reinforce the Roraima border crossing between Brazil and Venezuela as a military deterrent, given that it is the only strategic land entry point into Guyanese territory. Lula also mediated the meeting between Presidents Ali and Maduro on December 14th, having been carefully rebuilding the Brazil-Venezuela relationship, signifying his importance as America’s regional ally.
The United States will continue to support the Guyanese government as well as appealing to both sides to abide by UN and ICJ rulings, knowing that Venezuela is unlikely to do so and may have to be compelled to back down. Moreover, if the United States can find some sort of victory here, in terms of a humiliation of Maduro in Caracas, it would be more effective than any sanctions regime which can - as Russia have shown during the Ukraine War - be subverted. A win for the West in this theatre would be the expulsion of Chinese influence from Latin America. In practical terms this would involve Guyana remaining entrenched in its position with the promise of concrete military and diplomatic support from Western powers, as well as an increase in sanctions on Venezuela, and Maduro in particular, for breaching not only the terms of the Barbados Agreement, but the rulings of the ICJ and the United Nations.
Where next?
The meeting on 14 December did not lead to any meaningful de-escalation as Irfaan Ali has been emboldened by the strong support of the US to state that ‘not one blade of Guyanese grass will be yielded’, and Maduro has not even achieved his domestic goal at this point. The arrival of US military forces in the region, including an overflight by US fighters on 12 December, as well as the number of geostrategic interests at play means that this should perhaps be more of a concern than it currently is. Furthermore, this presents a very interesting opportunity for the United States and its allies in the broader geo-political spectrum. Events have moved very rapidly, and with China caught in a compromising position supporting both sides, there is a chance to split Guyana away from the Belt and Road initiative by supporting it quickly and aggressively. States are most easily influenceable when there is a threat, by forcing Maduro to back down on his own, his credibility could be shredded, and as sanctions ramp back up as a result the best case scenario for the West would be a situation akin to Galtieri after the Falklands, the sudden collapse of the regime, but without the bloodshed. Maduro’s rhetoric has placed his regime in a situation where it’s legitimacy and credibility is at stake. While the concern should exist about his next moves, especially given the noises coming from the Venezuelan military demanding conflict, this may not be a tactical diplomatic ploy, but rather a desperate play at the endgame of a regime.