- Understand the dynamics of Venezuela’s urban society and why Venezuela has not experienced a robust rural-to-urban shift to the extent that other countries have.
- Summarize the production of the three main export products of Colombia and explain the US role in their export.
- Compare the three main countries in the Andean West region of South America and understand how they gained their wealth and who has benefited the most over the years from that wealth.
- Outline how Paraguay’s geographical setting has allowed it to gain wealth and provide opportunities for its people.
Venezuela: Oil, Politics, and Globalization
Bordering the Caribbean is the large urban country of Venezuela. The Andes Mountains reach into the northern part of the country and make up the terrain of the northern coastal region all the way to the capital city of Caracas. The large grassland plains of the Llanos extend farther south from the Colombian border to the Orinoco River delta. The Llanos is a large, sparsely populated region that makes up about one-third of the country. It is remote, susceptible to flooding, and used mainly for raising cattle. In the southeast of Venezuela are the Guiana Highlands, which make for a spectacular physical landscape of tropical forests and rugged mountainous terrain. The highlands include Angel Falls, the tallest waterfall in the world. Angel Falls drops 2,647 feet and is Venezuela’s most popular tourist attraction. Lake Maracaibo, a large inland sea located in the western region of the country, is not a true lake in that it is open to the Caribbean Sea, but it is considered the largest inland body of water in South America. Lake Titicaca, located in the Andean region of the Altiplano on the border between Peru and Bolivia, is considered the continent’s largest freshwater lake.
Venezuela has an assortment of physical regions, but most of the population lives along the northern coast. About 90 percent live in urban areas, and the capital Caracas has the highest population. Less than 5 percent of the population lives south of the Orinoco River, and Amerindian groups live in the interior and along the river.
Included in the Mixed Mestizo Cultural Region, Venezuela has a heavy Spanish influence laid over an Amerindian base in a plantation region known for its African infusion. There is also a strong Caribbean cultural flavor, which is evident in the region’s music and lifestyle. The official language is Spanish, but more than thirty indigenous languages are still spoken in the country.
Venezuela gained its independence from Spain in 1821 and has developed into an urban country with an economy based on oil production. A large extent of the interior is undeveloped. Venezuela does not have extensively developed agricultural production, so most food goods are imported. Lake Maracaibo has vast oil reserves beneath it that have provided substantial wealth to the country.
As much as 90 percent of Venezuela’s export earnings are from the export of oil. Venezuela’s national oil company, CITGO, has made extensive inroads into the US gas station market. The country was one of the founding members of OPEC (Organization of Petroleum Exporting Countries), which is usually associated with the oil-rich states of the Persian Gulf. In the past decade, Venezuela has been one of the top five countries exporting oil to the United States. The other four are Canada, Mexico, Saudi Arabia, and Nigeria.
As is the case with many countries, national wealth in Venezuela does not filter down to most of the population. The wealthy elite who have benefited the most from the nation’s wealth often find themselves on the opposite side of the political debate from the majority, who are likely to live in poor conditions. Caracas has many upscale neighborhoods, but it also has a large number of slums on the outskirts of the city. Slums in South America go by different names, such as barrios in Venezuela or favelas in Brazil. Many of Venezuela’s barrios are built on the mountainsides of the Andes.
Exporting oil to the United States does not inherently lead to a friendly political relationship between the United States and Venezuela. There has been some political unrest within the country related to the current president, Hugo Chavez, holding continuous terms in office without term limits. President Chavez has held close ties with socialist Cuba and with the Castro regime and has made somewhat antagonistic statements about the world’s core economic countries. From time to time, his rhetoric and his positions are not geared toward enhancing the country’s political relationship with the United States. This situation has caused concern within the US political establishment with regard to the position that the United States takes toward Venezuela. Nevertheless, the United States remains Venezuela’s number one trading partner in both imports and exports.
Politics in Venezuela often plays the wealthy elites against the poorer majority, and President Chavez has not been an exception. Chavez has supported socialist political leaders from other Latin American states and has pushed a globalization agenda along the same lines. The country’s enormous oil revenues and its current political climate have increased Venezuela’s visibility in the global arena, but how this will play out over the long term is unclear. In the past, Latin America has had a greater number of elected political leaders with more progressive or socialist views. These trends continue to shape the economic trade agreements between countries. Venezuela has been working to increase sales of oil to countries in Mercosur (the Southern Cone Common Market), which is the most significant trade association in South America.
Globalization is also evident in Venezuela’s cultural and social dynamics. In many Latin American countries, soccer (European football) is the most popular sport, but Venezuela’s biggest sport is baseball because of the influence of early US activity in the country’s oil industry. Soccer is gaining attention and support, however. Orchestras and classical music performances have also gained notoriety in recent years. Concert halls from the Americas to Europe have experienced the performances of the Simón Bolívar Youth Orchestra. The Miss Venezuela pageant is a major production for the country, and Venezuela has won the top title at least five times in each of the following pageants: Miss World, Miss Universe, and Miss International.
Colombia: Drugs, Coffee, and Oil
Three ranges of the Andes Mountains run from north to south through Colombia, which is larger than the nine most southeastern US states. With a land area covering about 440,839 square miles, Colombia is more than ten times larger than the US state of Kentucky and close to twice the size of France. Colombia borders five countries, with the Caribbean to the north, the Pacific Ocean to the west, the Orinoco River to the east, and a short segment of the Amazon River to the far south. Even though agriculture has been a mainstay of the country’s economic activities, because of the influence of the mountainous terrain, about 75 percent of the population lives in urban areas.
Colombia was a Spanish colony during the time that Spain controlled most of western South America. Colombia became independent in 1819. The region of Panama, which was first a part of Colombia, broke away in 1903 when the United States backed Panama’s independence movement. After Colombia became independent of Spain, the conservatives (wealthy elite) and the liberals (poor workers) struggled to gain control of the government. Since 1948, the conflict, known as La Violencia, has caused more than two hundred thousand casualties. During the twentieth century the government in Colombia has not always been peaceful or stable. By the beginning of the twenty-first century the government has become more unified and the country has even witnessed an increase in tourism.
Colombia and the Drug Trade
Colombia’s tropical climate and its many remote areas contributed to its development as a major coca-growing region. By the 1970s, extensive drug smuggling had developed, and powerful drug cartels became major political brokers within the country, competing against the government for control of Colombia. The largest and most organized cartels operated out of Medellin and Cali, the second- and third-largest cities in the country after the capital city of Bogotá.
The coca plant grows throughout the slopes of the Andes, from Colombia to Bolivia. Historically, locals have chewed it or brewed it into tea. Coca can alleviate elevation sickness and act as a mild stimulant. Using modern methods and strong chemicals, the coca leaves can be converted into coca paste and then into cocaine hydrochloride, a powerful narcotic. It often takes up to a ton of such chemicals as sulfuric acid, kerosene, methyl alcohol, and additional substitutes to produce a kilo of cocaine. Once the process is completed, most of the chemicals are discarded and frequently find their way into nearby rivers and streams, which are the same water supplies that local people drink, clean with, and bathe in. Birth defects have become a problem in coca-growing regions because of the high levels of chemical pollution in water supplies.
It must be noted that the short, leafy coca plant that cocaine comes from is not the same as the cacao tree that produces the beans that chocolate or cocoa comes from. They are two completely different plants with separate processes.
The United States is the largest cocaine market. Secret airfields and private boats transport the cocaine from Colombia to distribution centers in Mexico, Central America, or the Caribbean. From there, the drugs are smuggled into the United States. Colombian drugs are a multibillion-dollar industry that makes up a large portion of the Colombian economy. The effect of the drug industry on the people of Colombia is extensive—from the gunfire on the streets to the corruption of government officials. In recent years, the same drug cartels that have operated the cocaine industry have imported opium poppies, which grow well on the higher and more arid slopes of the Andes. Opium poppies are native to Asia but have been transported to South America. Opium is extracted from the seedpod and can be further refined into heroin. Colombian drug cartels, with a Mexican distribution network, have muscled into as much as 20 percent of the US heroin market. The US government has supported the Colombian government in the fight against the drug cartels and the trafficking of illegal drugs out of Colombia.
Colombian Coffee and Oil
Colombia’s two main legal exports to the United States are coffee and oil. Coffee is only grown in the tropics, since coffee trees must be grown in a frost-free environment. Coffee trees, which originally grew in Ethiopia, have since been grown throughout the world. Coffee trees can grow in elevations from sea level to six thousand feet, but most of the best specialty coffee is grown at elevations between three thousand to six thousand feet. Colombia has ideal conditions for growing coffee and was once the world’s largest coffee producer; now Brazil and Vietnam each produce more.
Early coffee production in Colombia was initially promoted by Catholic priests who were influential in supporting local parishioners to grow the crop. The industry was greatly enhanced in 1927 with the formation of the National Federation of Coffee Growers of Colombia. Coffee production on the mountain ranges of the Andes in Colombia supports up to a half million small farms and local growers that make up a large portion of the coffee economy. Harvesting coffee is labor intensive and can employ large numbers of workers. The seasonal nature of the harvest also leaves workers to find employment during the rest of the growing season.
In recent years, there has been growing concern about how climate change will continue to affect the region’s coffee production. In the past century, parts of Colombia experienced up to a 1 ºC average temperature increase and up to a 25 percent increase in precipitation. These climate changes have negatively affected coffee output and reduced coffee production as much as 25 percent in some areas. New agricultural methods are being developed in an attempt to counter these effects.
Oil has now become Colombia’s number one legal export. Oil is found in fields in the northern and central regions of Colombia. Immense quantities of coal are also found in the same regions, but oil is more valued on the export market. Pipelines connect the interior oil fields of Colombia with the northern ports. The US market size and population make it the world’s largest oil consumer. US oil companies have been investing in the development of Colombian oil for many years. Colombia has been a developing oil source even though its total extractable resources are not as vast as in other countries. For example, in 2006 the United States imported more oil from Colombia than from Kuwait, Oman, the United Arab Emirates (UAE), Bahrain, Qatar, and Yemen combined.
Since the United States is the largest consumer of Colombian oil, it is easy to understand why the United States has a vested interest in the stability of the Colombian government. A sizable portion of Colombia is controlled not by the government but by drug cartels or other insurgent groups. Dozens of guerilla organizations also control portions of Colombia. Some insurgent groups support the government and are against the drug lords, while others fight the government and work independently or with the cartels. Drug sales, kidnappings, and extortion of legitimate businesses provide income to these groups. Thousands of children serve in these groups, and about a third of them are female. The most powerful insurgent group is FARC (Revolutionary Armed Forces of Colombia), which controls entire regions the size of many US states. FARC is a recognized political entity by neighboring countries but is not given the same recognition by the United States and many external countries of the region.
The relationship between Colombia and the United States is often conflicting. The US consumer supports the Colombian drug cartels by being the largest consumer of illegal drugs. The US government, under the Drug Enforcement Administration (DEA), has declared a war on drugs and has supported the Colombian government with billions of dollars in foreign aid to fight that war. On another front, US oil corporations have paid insurgent groups to protect their oil assets. Oil is exported to the United States, bringing billions of dollars into the Colombian economy. The chaos in Colombia is directly related to the exploitation and marketing of their resources. It is the people of Colombia that suffer in the cross fire from this civil war of corruption, crime, death, and destruction. The United States is a counterforce partner in this situation but operates from the consumer end of the resource pipeline. The largest consumer market for Colombia’s export of oil, drugs, and coffee is the United States, which is also the largest contributor of foreign aid to Colombia.