The situation in Venezuela continues to deteriorate, with the country’s myriad problems exacerbated by and fundamentally linked to rampant political corruption and self-enrichment within the Maduro regime. In recent years, the U.S. government has sought to pressure Venezuela’s government to change its behaviors, viewed as threatening to U.S. security interests, through the imposition of economic sanctions. The political corruption in Venezuela, as well as the sanctions with which the U.S. has responded, have created legal and compliance risks for U.S. businesses. While these challenges related to Venezuela predate the Trump administration (for instance, Congress passed the Venezuela Defense of Human Rights and Civil Society Act in 2014), there are new challenges to which U.S. businesses must adapt, including economic sanctions, anti-corruption, and anti-money laundering compliance risks for which global businesses should be prepared.

Recent Statistics on the Crisis

As documented by numerous credible sources, the general state of affairs in Venezuela is pretty terrible. Nicolas Maduro first declared a state of emergency in 2016, as inflation surpassed 250% according to International Monetary Fund statistics. The UN High Commissioner for Refugees estimated last year that least 3 million people, or about 10% of the country’s population, have fled the country. A study performed by a consortium of Venezuelan universities found that the average Venezuelan lost 17 pounds in 2016 and 24 pounds in 2017. A Lancet Global Health publication this year cited the infant mortality rate as having increased by over 40% since 2006. By the end of 2018, IMF figures pegged inflation at 1,300,000%, a rate that caused the average good to double in price every 19 days, with the projected rate of inflation to possibly hit 10,000,000% in 2019. By comparison, the next-highest projected countrywide increase from the IMF is 73.4%, in Zimbabwe, and the Consumer Price Index in the U.S. rose by 2% last year.

U.S. Recent Responses

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