An old territorial flashpoint between Venezuela and neighbouring Guyana has returned to the forefront of politics in South America, raising concern in the region and the wider world that it could develop into an open war.
The dispute over the Essequibo territory, officially part of Guyana, was thought to have been all-but resolved in 2004, when Venezuela’s President Hugo Chavez distanced himself from his country’s claims over the area, saying they should be consigned to history.
Chavez’s successor, President Maduro, has taken a different approach as his economy has toppled into crisis, sparking a wave of emigration, bitter internal politics and a more aggressive stance over his borders.
Al Majalla looks at the roots of this potential conflict between two nations, in a part of the globe shaped by its colonial history as much as its Amazonian geography and abundant natural resources.
Colonial legacy
Guyana is a small republic in the northernmost part of South America, sharing borders with Brazil, Venezuela, and Suriname, It is a part of the wider Guianas region in the Amazon basin, named from an Indian meaning "land of many waters" because it is rich in rivers.
European colonisers split it up. Spain gave the region Venezuela, while the Portuguese brought in Roraima, which is now part of Brazil. The Dutch carved out Suriname, which has been independent since the mid 1970s. French Guiana remains an overseas dependency, as its name implies.
Then there is Guyana, Britain’s former colony, independent since the mid 1960s. It is the third-smallest country in South America by land area, covering around 214,000 square kilometres. It is the second smallest in terms of population, with around 800,000 people. The Essequibo region constitutes more than two-thirds of its territory and is home to under a sixth of its population.
Guyana is also the sole South American country that speaks English leaving it culturally affiliated with English-speaking Caribbean including Jamaica.
Various indigenous tribes were the original inhabitants of Guyana. It was first colonised by the Dutch in the early 17th century, who relinquished control to the British by the close of the 18th century.
Sugar and slavery
Guyana’s economy was built on sugar plantations, with the crop dependent on slaves brought in from Africa.
After slavery was abolished in 1834, Britain brought in a new workforce, primarily from its Indian colonies, a practice that persisted until the early 19th century and had a major bearing on the country’s population.
The biggest demographic group in the modern Guyana is of Indian descent, at 43% of the population. Afro- Guyanese people make up about a third of it. Traditionally, Guyanese of Indian descent predominantly inhabit rural areas, while those of African origin tend to concentrate in coastal regions.
Guyana’s path to independence in the 1960s, took longer than some of its neighbours, a factor that has influenced the current territorial dispute.
Venezuela’s independence came in 1824. Shortly afterwards, its “liberator” Simón Bolívar staked a claim with the British over the lands to the west of the Essequibo River. In 1899, an international arbitration panel comprised of judges from Russia, England, and the United States ruled in favour of Britain, a decision that Venezuela acquiesced to at the time.
But over subsequent years and with the testimonies of jurists involved, it became evident that the arbitration process was unfair and badly run.
On the eve of Guyana's independence in 1966, a diplomatic accord was reached in Geneva between Britain and Venezuela. It nullified the 1899 arbitration and set up a mechanism to address the dispute via transitional negotiations spanning four years.
But no resolution was reached between the newly established state and its longer-standing neighbour. Venezuela continues to assert its claim over the lands, as does Guyana.
And then came a new factor into this old dispute: Oil.
Oil and money
In 2015, ExxonMobil identified substantial oil reserves in the area claimed by both countries.
Last month, fresh findings put the size of the Guyana find at about 11bn barrels of crude. That is enough to catapult the country above Kuwait into the top spot in rankings of proven reserves per capita.
ExxonMobil is involved in 63 exploration projects and has boosted Guyana's daily oil production to 600 thousand barrels, with the potential to reach 1.2m by the end of 2027.
This comes just as Venezuela’s oil industry is tied up in US sanctions, limiting its ability to export from its own proven oil reserves, which are the biggest in the world. It also has trouble with mismanagement in the industry. Its oil production has plummeted from 3mn barrels per day to less than 400,000 over the last decade, although there is a gradual recovery underway, taking the figure to around 750,000.
A tale of two economies
And so, the two countries have been through very different recent experiences with their economies and the energy export industries that can transform their fortunes.
Since the discovery of oil, Guyana once one of the world’s poorest countries, has been achieving unparalleled global growth figures, also helped by a transformative economic restructuring in the late 1980s. In the current year alone, its national output rose by approximately 38%
Conversely, the Venezuelan economy, already heavily dependent on oil, is grappling with its most profound crisis in history. Over the past decade, its national output has dwindled by roughly 80%, and in 2019, hyperinflation soared to an unprecedented 200,000%, setting a global record that will probably never be surpassed.
