On December 3, Venezuela, a major oil-producing country, held a nationwide referendum on incorporating the Essequibo region of neighboring Guyana as its 24th state. Preliminary results on December 4 indicated that 96% of Venezuelan voters favored annexing the Essequibo region, currently under Guyana's control, with a 51% voter turnout.
Although the referendum is not legally binding, residents of the Essequibo region in Guyana did not participate, and the Maduro government of Venezuela previously stated that it would not use the referendum to justify reclaiming the area, the Venezuelan military has announced its commitment to "follow the people's mandate to reclaim the territory."
Guyana's Prime Minister Mark Phillips has vowed to "defend every inch of territory." Meanwhile, Brazil, a regional power and a common neighbor to both countries, has called for restraint from both nations while deploying additional troops to the Venezuelan border, preparing for a potential outbreak of war.
The Essequibo region, a legacy issue from the European colonial era, has been a point of contention between Venezuela and Guyana for over a century.
Named after the north-south Essequibo River that runs through Guyana, the region was once considered a natural boundary of Venezuela (then the Captaincy General of New Granada) by the Spanish Empire in 1777. Post-independence Venezuela also claimed the Essequibo River as its eastern boundary.
However, this claim has never been recognized by the successive colonial powers of Guyana. Guyana, which gained independence in 1966, was successively a colony of Spain, the Netherlands, and the United Kingdom. In 1899, an international arbitration tribunal supported by the United States confirmed the existing boundaries between Venezuela and Guyana (then British Guiana), assigning the Essequibo region to Guyana.
Venezuela has consistently refused to recognize the tribunal's decision, citing fraud in the arbitration process. Negotiations led by the United Nations prior to Guyana's independence also ended without resolution. However, this has not stopped Venezuelan textbooks and maps from including the Essequibo region as the country's 24th state, which is the fundamental reason for the high support rate in the recent referendum.
Significantly, the Essequibo region, covering 160,000 square kilometers and accounting for 62% of Guyana's total area, is densely forested and sparsely populated, with only 230,000 residents. Until recently, the Venezuelan government showed little practical interest in the region.
This changed in 2015 and October of this year when oil giant ExxonMobil discovered substantial oil reserves in the region. Current estimates suggest that with the discovery of oil in the Essequibo region, Guyana's proven oil reserves have increased to at least 11 billion barrels, surpassing Kuwait and the UAE. Considering Guyana's population of only 800,000, the country has become the world leader in per capita oil reserves.
Following the Guyanese government's issuance of oil exploration licenses to eight international energy giants and local companies in the Essequibo region on September 19 this year, and plans to increase the country's oil production from about 300,000 barrels per day to 1.2 million barrels by 2030, Venezuela swiftly took a hard stance. On one hand, Venezuela detained a Guyanese oil exploration ship on October 10 and mobilized military forces along the border of the Essequibo region; on the other hand, the Venezuelan National Electoral Council approved the referendum on October 23, igniting the regional crisis.
While the Venezuelan army, with over 110,000 soldiers, is far stronger than the Guyanese defense force in both quantity and quality, experts generally predict that the Venezuelan military would struggle to fully occupy the vast and remote region, even without direct intervention from the U.S. Southern Command.
Annette Idler, Deputy Professor of International Security at Oxford University, noted that the Venezuelan authorities have limited control over border areas and would need to deploy a large number of troops to occupy the region. Therefore, it is unlikely that Venezuela could seize the area and is probably just posturing. Currently, there is no evidence of significant troop movements by the Venezuelan military to the border.
Idler believes that conflict or outright war would lead to the reinstatement of recently lifted U.S. sanctions on Venezuelan oil exports, a consideration that requires careful deliberation given Venezuela's fragile economy. Idler stated, "At that point, Maduro will have to choose between losing face and facing new U.S. sanctions."
Rather than repeating the fate of Argentina's Galtieri government, Maduro's use of the referendum to stir national pride is widely seen as a means to divert internal conflicts and address domestic economic and political crises. In 1982, then-President of Argentina's military government, Galtieri, declared war on the UK to reclaim the Falkland Islands, believing he had good relations with the Reagan administration in the U.S. However, he resigned after losing the war due to isolation.
Phil Gunson, an analyst with the International Crisis Group living in Caracas, said, "For electoral reasons, Maduro needs to wrap himself in the national flag, and clearly, a territorial dispute with a neighboring country is a perfect excuse."
Since Juan Guaidó's failed attempt to overthrow Maduro in 2019, U.S. sanctions on Venezuela have never been relaxed. It was not until October 18 this year that the U.S. Treasury Department's Office of Foreign Assets Control announced the lifting of some energy trade sanctions on Venezuela in response to the Venezuelan government's political agreement with the opposition. The negotiation aimed to resolve Venezuela's prolonged political crisis and hold presidential elections in 2024.
However, the Venezuelan opposition does not believe Maduro is sincere about holding elections or transferring power in 2024. For instance, María Corina Machado, a prominent opposition figure, has been banned from running for office. Nevertheless, this did not prevent the opposition from mobilizing over 2.4 million people for next year's presidential primaries, in which María Corina Machado received overwhelming support.
Maduro subsequently declared this action illegal.
Gunson believes that Maduro's initiation of the referendum aims to leave an impression with the public that the government can mobilize people in ways the opposition cannot. The referendum's topic attracted far more than 2.4 million voters.
Rocío San Miguel, a Venezuelan defense analyst, suggests that Maduro might declare a state of emergency to suspend elections if it becomes clear he will lose.
Economically, under Maduro's presidency since 2013, Venezuela's economy shrank by nearly 80% from 2014 to 2021, leading over 7.7 million Venezuelans to migrate to neighboring South American countries like Colombia and Ecuador. Although the Maduro government successfully ended the hyperinflation cycle by the end of 2021 through reduced public spending, increased taxation, and foreign currency injections, the country has faced renewed inflation challenges since 2022. This includes the fact that Maduro did not announce an increase in the country's minimum wage on May 1, Labor Day, last year, leaving the minimum monthly wage of 130 bolivars equivalent to only $3.7, down from $30.
As of November, the number of Venezuelan migrants intercepted at the U.S.-Mexico border has exceeded 199,500, a stark increase from just 2,700 in 2020.
