Viewpoint: New era for US-Venezuela relations?

Hillary Clinton shakes hands with Hugo Chavez Hillary Clinton shakes hands with Hugo Chavez at the 2011 inauguration of the Brazilian president

The death of Hugo Chavez leaves much uncertainty in Venezuela. But Shannon O'Neil says stronger ties with the United States may be on the horizon.

After 14 years in power, Venezuelan president Hugo Chavez lost his long and secretive battle with cancer.

Many now wonder about his domestic and international legacy. For the US, one of the important questions is whether his bilateral foreign policy approach will continue without him.

The US-Venezuela relationship has been characterised over the past decade by public spats and outlandish statements, but it was not always so hostile.

When Chavez was elected in 1998, interactions between the two countries were cordial; Chavez even travelled to Washington to meet then-President Bill Clinton.

But the relations soon headed downhill.

'Smell of sulphur'

In 2002 Chavez accused the US of supporting the coup that briefly ousted him from power, as US officials were quick to welcome the transition. In 2005 bilateral counter-narcotics operations ended.

Since then American spokespersons have criticised Venezuelan officials for their involvement in the drug trade, skewering the country in annual drug reports and freezing the assets of at least seven current or former Venezuelan officials.

The bad blood was immortalised in Chavez's 2006 United Nations speech when he theatrically referred to then-President George Bush as the devil, commenting on the distinct smell of sulphur that remained at the podium.

In 2010, Chavez declared then-Ambassador Patrick Duddy persona non grata, marking the last time that the US had an ambassadorial presence in Venezuela (but not the last time the two countries have expelled diplomatic personnel).

With Chavez's death, some have hoped for a change in the US-Venezuela relationship. But just because Chavez is gone it doesn't mean the tensions in bilateral relations will ease.

Shifting ties

The US is too useful and tempting a foil for papering over internal disagreements in Chavez's party and for rallying loyal supporters for the upcoming presidential election to expect any abrupt change.

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Colombia, Brazil, Peru, and other Latin American nations, have opened up to the United States and in the process benefited tremendously. ”

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Heir apparent and now interim President Nicolas Maduro's speech right before Chavez's death shows this. In it he expelled two US diplomats and even accused the US of causing Chavez's cancer.

But in the longer term, trade, commercial relations and personal ties could shift US-Venezuelan relations for the better.

First and foremost are the economic ties between the two nations. Despite the rhetorical animosity of the last decade, trade continued.

The US remains the largest recipient of Venezuelan oil - some 40% percent of Venezuelan oil exports (and oil makes up over 90% of the country's total exports).

In turn, the US has continued to send machinery and cars, and even increased exports of natural gas and petroleum products to the South American nation.

The hard currency and goods are vital to the functioning of Venezuela's economy, government and society, and may become even more so through the anticipated tough economic times ahead.

Man holds a protest sign with Hillary Clinton and Barack Obama made to look like demons Venezuelans protested American officals on the ninth anniversary of the failed coup against Chavez

Despite the increased government management of the economy through price controls and the nationalisation of hundreds of private companies over the last decade, many well- and lesser-known US companies still work in Venezuela, providing not just goods but ongoing links with the United States.

In addition to these commercial links, the more than 200,000 Venezuelans living in the US and the hundreds of thousands more that have ties through family, friends and colleagues, could also bring the two countries together.

Finally, as subsequent Venezuelan governments look to adjust their economic policies in the coming months and years, the experience of their neighbours provide incentives to forge a more amicable bilateral relationship.

An emerging 'third way'

Colombia, Brazil, Peru, along with other Latin American nations, have opened up to the US and the world more broadly in recent years and in the process have benefited tremendously.

In the last set of hemispheric elections, a "third way" combining open markets, balanced fiscal accounts, and socially inclusive policies - most closely identified with former Brazilian President Luiz Inacio Lula da Silva - became an almost mantra for incumbent and opposition party candidates alike (including Chavez's 2012 rival, Henrique Capriles Radonski).

These nations and leaders illustrate a real and positive path forward, not just economically but also diplomatically.

Today Venezuela faces significant political uncertainty, as Mr Maduro works to unite the many factions within Chavez's party. He does so without Chavez's charisma nor the deep-seated loyalty he inspired.

The next administration also will confront growing economic and fiscal problems, making governing all the harder in the months to come.

Still, in most of Latin America anti-US rhetoric is fading, which suggests it can in Venezuela too.

Shannon O'Neil is Senior Fellow of Latin America Studies at the Council on Foreign Relations, and author of Two Nations Indivisible: Mexico, the United States and the Road Ahead.

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