It is a precipitous moment for Venezuela and Guyana this week as they meet to address the longstanding dispute over the Essequibo region. Leaders from both nations have said they will come to the table with the Brazilian president Luiz Inácio Lula da Silva, the St Vincent and Grenadines prime minister Ralph Gonsalves, and the UN secretary general António Guterres.
In recent weeks, the two have seemed to be drawing closer to conflict. Venezuela has threatened to annex the densely forested Essequibo region, which constitutes two-thirds of Guyana’s territory, after holding a referendum to seek support. While the Venezuelan president Nicolás Maduro’s pseudo-referendum further exposed his disregard for international law, both countries are reenacting what was a colonial conflict between the British and the Spanish.
The prevailing western sentiment asserts that slavery, indentureship and colonialism are mere relics of the past, holding no sway over the future. Such a stance, characterised by intellectual laziness, belies the historical threads woven through the Caribbean islands – a constellation of minuscule paradises whose tumultuous pasts continue to reverberate.
The Caribbean was a contested chessboard, a theatre of geopolitical manoeuvres, where the world’s mightiest engaged in a high-stakes “race for wealth” throughout the 15th century. The Spanish, Portuguese, British, Dutch and French orchestrated a relentless violent exchange of “ownership”, leaving in their wake the genocide of Indigenous inhabitants and the legacy of human bondage of stolen Africans.
Guyana was once encompassed within “the Guianas”. This geographical expanse included present-day Guyana (British Guiana), Suriname (Dutch Guiana), French Guiana, the Guayana region in Venezuela (Spanish Guyana), and Amapá in Brazil (Portuguese Guiana). The Essequibo dispute has roots centuries deep, involving Spanish, Dutch and British claims.
The Dutch ruled until the 1814 treaty handed over control to the British, shaping Guyana’s predominantly plantation-style economy. Then came the discovery of gold.
By 1841, Venezuela was contesting the territorial boundaries established by the British-appointed surveyor Robert Hermann Schomburgk, arguing that it violated the understood delineation at the time of Venezuela’s 1811 independence.
In 1895, the US president Grover Cleveland intervened. Cleveland’s secretary of state, Richard Olney, revived the Monroe Doctrine, warning Britain against European colonial projects in the western hemisphere. Olney pressed for US sovereignty. The British scepticism of the doctrine’s compatibility with international law led Cleveland to seek congressional authority to appoint a boundary commission while warning Britain of potential military action, a threat that fuelled outrage.
Britain eventually yielded to US demands for arbitration. The commission – two Americans representing Venezuela, two British and one Russian – was established in 1899 and led to the settling of the border dispute, with some variations. This favoured Britain as it included the prized goldmines, and was contested by Venezuela, which alleged undue pressure on the Russian arbitrator. The dispute simmered on.
In 1966, long after the end of British empire, the UK, Venezuela and Guyana signed the Geneva agreement. Despite Guyana’s independence that year, Venezuela explicitly included a claim to the area east of the Essequibo. The Geneva agreement imposed a four-year deadline for resolution.
Numerous UN-appointed diplomats attempted to mediate, but no progress was made. In 2018, the UN referred the matter to the international court of justice (ICJ), a move supported by Guyana but opposed by Venezuela, which contested the ICJ’s jurisdiction. Earlier this year, the ICJ affirmed its jurisdiction, paving the way for further legal proceedings.
Guyana, uniquely as a South American nation, is paradoxically part of the Caribbean, with cultural, historical and political bonds to neighbouring countries. It is the headquarters for the Caribbean Community (Caricom), which has strongly supported the preservation of Guyana’s sovereignty, condemning any aggressive actions by Venezuela and urging that the dispute be adjudicated at the ICJ.
In 2017, 41% of Guyana’s population lived below the poverty line, a telling marker of socioeconomic challenges. Guyana’s economic landscape underwent a paradigm shift when crude oil deposits were unearthed and commercial drilling started in 2019. Guyana achieved 49% GDP growth in 2020, defying the global economic downturn induced by the Covid pandemic. This catapulted the nation into the echelons of the world’s fastest-growing economies.
The revelation of an estimated 11bn barrels in oil reserves underscores Guyana’s role in the global energy panorama. Should current trends persist, Guyana is poised to emerge as one of the foremost per capita oil producers worldwide by 2030. This discovery constitutes the most substantial addition to global oil reserves since the 1970s, bringing a shift in dynamics of the international energy landscape.
Guyana has ascended to the ranks of the Americas’ fourth-highest GDP per capita, behind the US, Canada and the Bahamas, a position that Trinidad and Tobago once held during its “oil boom” heyday.
Historically, Guyana’s borders have been contested by Venezuela and Suriname but become cemented over time. So why is Maduro acting like the bully in the playground and suddenly threatening annexation to add to his empire, a failed state that has seen 7 million people abandon their home country?
A quarter of the Venezuelan population has departed since 2015 as a result of economic and political turmoil. Their primary destination has been Latin America and the Caribbean, where more than 80% of migrants have resettled, many of them facing considerable obstacles to finding housing and employment.
This all presents questions about the sudden and aggressive stance of Maduro. Is it driven by the oil discoveries or the involvement of the US oil company Exxon? Or is it the proximity of a potential US military base along the disputed border? Or the Venezuelan electoral landscape? Maduro is in danger of losing the election for the first time in years, especially if the courts authorise the leading opposition candidates.
In this scenario, autocratic leaders typically employ a time-honoured strategy of identifying an external adversary to galvanise public sentiment, solidifying their image as the nationalistic hero.
Many Caribbean islands are now reflecting on their ties with Venezuela. Venezuela provided crude and refined oil to several Caribbean neighbours under suspiciously favourable terms in 2005. Known as the Petrocaribe alliance, it was supposedly established to promote regional economic cooperation. In reality, it was seen to counterbalance US influence in the region.
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President Biden’s recent decision to lift certain sanctions on Venezuela, aimed at addressing surging crude prices, which had spiked to nearly $90 a barrel after the Hamas attacks on Israel on 7 October, adds another layer to the geopolitics. The conditions attached, calling for free elections in Venezuela, have faced scepticism due to the broader challenges confronting PDVSA, the national oil company, which extends beyond the impact of sanctions.
The company has been plagued by deteriorating infrastructure, and production equipment that has been neglected, dismantled and sold for scrap. This, along with rampant corruption, has resulted in substantial losses of $21.2bn. The arrest of PDVSA’s former vice-president and more than 60 government officials and businesspeople on corruption charges in April raised doubts about their ability to revive Venezuela’s collapsing oil industry.
So Guyana, predicted to increase its output from 400,000 to 1.2m barrels a day, holds significant importance. Despite a warning from the ICJ, Maduro went ahead with the referendum, which triggered concerns reminiscent of when the former president Hugo Chávez seized all Exxon’s oil assets overnight in 2007. Maduro has already ordered Exxon to leave, and instructed PDVSA to issue new licences.
President Biden may appear eager for a confrontation with Venezuela to bolster his position before next year’s US election, but he is potentially setting the stage for another proxy war with Russia, given Putin’s likely support for Maduro.
Amid this maelstrom, Thursday’s proposed meeting aims to de-escalate through face-to-face dialogue while Maduro remains committed to historical sovereign rights over Essequibo, and Guyana’s president, Irfaan Ali, reiterates that Guyana’s land borders are non-negotiable.
Guterres wants the Essequibo standoff settled peacefully and has urged ICJ cooperation. The ICJ will hold a trial in the spring, despite Venezuela’s rejection of its jurisdiction. Gonsalves has stressed the importance of respectful dialogue, highlighting the urgency of avoiding escalation or use of force.
As the drama unfolds, historical grievances, geopolitical interests and economic considerations converge to challenge the destiny of Venezuela and Guyana, and the reverberations will be felt across the Caribbean and Latin American landscape.
