The Pink Tide seems to be waning. When the Venezuelan President Nicolás Maduro declared emergency last week owing to a severe economic crisis, one of Latin America’s strongest Left holdings suffered a blow—both in ideological and economic terms.
The root of the problem is not hard to find. Venezuela’s socialist model brought in by Hugo Chavez in the late 1990s was entirely based on one factor—high oil prices. When this dropped, the populist spending could not be sustained by his successor and the economy collapsed with inflation hitting triple digits. The country is facing shortages and is likely to default on its international debt.
While the political crisis in Venezuela will play out in the near term, in the medium term, the country will have to find better ways of managing both the administration and the economy. Better relations with the international community and an economy that is not excessively dependent on oil exports is likely to work.