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Nov 20, 2018 | 19:53 GMT

3 mins read

Venezuela: Socialist Party Leader Loses Clout as Rivals Jockey for Power

(Stratfor)
The Big Picture

Since the death of Hugo Chavez in 2013, a loose conglomerate of occasionally competing political elites have ruled Venezuela. But oil revenue is shrinking, inducing greater competition among political elites looking to secure their share from the embezzlement of government income. As the number of rivalries increases, President Nicolas Maduro will try to keep some of the more powerful figures in check by curtailing their control over key government institutions.

What Happened

Venezuelan news website Noticiero Digital published a report on Nov. 16 claiming that military authorities had arrested or detained Gustavo Gonzalez Lopez, the former director general of the Bolivarian National Intelligence Service (SEBIN), Venezuela's domestic and foreign intelligence agency. According to the report, the Directorate General of Military Counterintelligence in Caracas had already been holding Gonzalez Lopez for several days before Nov. 16.

Why It Matters

The apparent arrest of a key former official is the latest sign of a brewing power struggle within Venezuela's political hierarchy that underscores the waning power of Diosdado Cabello, a leading figure in Venezuela's United Socialist Party. Until his removal as SEBIN director in late October, Gonzalez Lopez, who was also interior minister from 2015 to 2016, was Cabello's most influential ally in the country's domestic security services. With Cabello's clout now seemingly diminished, Economic Vice President and Industries Minister Tareck El Aissami — a powerful official feuding with Cabello — will find it easier to sideline the man once considered Venezuela's most powerful political figure behind President Nicolas Maduro. Cabello's lack of direct control over SEBIN will limit his ability to challenge his political rivals more directly for political power and, possibly, the presidency. Cabello's reduced influence will also hamper his ability to compete for a share of increasingly scarce government revenues.

The key question is what will happen next to Cabello. The Maduro government may try to simply sideline him for the time being to thwart his political ambitions. However, Cabello's loss of power raises the possibility that Maduro will eventually arrest him and use his potential extradition as a bargaining chip to launch negotiations with the United States in an attempt to delay sanctions against Venezuela's government.

Background

According to a 2017 report received by Stratfor, El Aissami has been helping Maduro erode Cabello's influence within the government. El Aissami sees Cabello as a potential rival for political power. By staying close to the higher echelons of power, El Aissami and his allies can continue to enrich themselves and maintain control of the levers of power so they do not face imprisonment in Venezuela or the risk of extradition to the United States on U.S. criminal charges. Such competition for power will worsen as oil revenue continues to shrink and the United States raises political pressure on Caracas in 2019. For example, Washington is considering designating Venezuela's government a state sponsor of terror. The designation would likely discourage companies from investing in Venezuela's oil sector, causing its oil production to fall further and increasing the incentives for the country's elites to grab a share of declining government income before it's too late.

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