Venezuela, Vanuatu, & The Vatican: No oil? No God? No Chance!

Marla Dukharan
3 min readMay 15, 2023

Google ‘oligarch’ and the results reflect the prevailing narrative that they are largely Russian/Soviet. But oily-garchies are everywhere, because the Paradox of Plenty predisposes resource-rich countries to subpar socio-economic outcomes, mainly because their extractive institutions promote corruption and kleptocracy (oligarchy’s jealous lover). The resource curse’s poster child has to be Venezuela — likely the world’s most resource-rich country (with the world’s largest proven reserves of oil, and vast deposits of gold, bauxite, iron ore, and coal), and possibly the world’s most decayed, into a narco-terrorist oligarchy.

The Global Organized Crime Index reports “The Venezuelan state is accused of involvement in contraband, cocaine smuggling, money laundering, patronage, the illegal exploitation of natural resources, exchange-rate manipulation, and corruption schemes related to the distribution of food and medicine.” Hezbollah allegedly “helped to turn Venezuela into a hub for the convergence of transnational organized crime and international terrorism…has facilitated Iran’s cooperation with the Maduro regime.” In 2009, the FATF reported “Venezuela has been classified as a transit country for illicit drugs…which account for the largest proportion of money laundering activities…corruption, which accounts for the largest number of cases analysed by the FIU, after…drug trafficking.” Yet, there is no evidence of FATF mutual evaluations post-2014 and Venezuela mysteriously does not appear on either of the FATF’s lists of Jurisdictions under increased monitoring nor High Risk Jurisdictions. In 2021, the OECD published “Gold Flows From Venezuela” highlighting significant illicit financial flows and “actual or potential risks of severe human rights abuses, conflict financing, and other financial crimes”. Otherwise, Venezuela appears to be invisible to the OECD, with no evidence of peer reviews or presence on OECD lists. And despite EU sanctions, Venezuela has never been EU-blacklisted.

You can read the full and original version of this piece online here.

The Vatican City State (VCS) is the tiniest nation on Earth by population (<1,000 persons) and size (121 acres), situated within the city of Rome in Italy. Mysteriously, the OECD’s home page lists 222 jurisdictions but the VCS/Holy See (HS) is absent and is also excluded from the 165 countries subject to OECD compliance assessments. Similarly, EU-blacklisters are also somehow blind to the VCS/HS. The FATF’s website lists two assessments of the Holy See by MONEYVAL, while the Council of Europe lists five. Importantly, the latest 2021 MONEYVAL report “is not an investigation of past or present allegations of criminal activities linked to the HS/VCS,” however. No wonder the report concludes, “Overall, the HS/VCS faces medium-low money laundering (ML) risk and low terrorist financing risk,” and as such, the FATF does not list the HS/VCS as a High Risk jurisdiction, nor one under Increased Monitoring. However, despite reporting “(MONEYVAL) is not persuaded that full scope AML/CFT on-site inspections every five years, supplemented by targeted inspections between assessments, is enough” the report states, “in line with MONEYVAL’s Rules of Procedure, monitoring was discontinued in 2019.

Vanuatu is the world’s single most vulnerable country to natural disasters and is also one of the poorest. Having gained independence as recently as 1980, Vanuatu has struggled to achieve sustained socio-economic progress largely because of the typical extractive-colony institutional weaknesses that persist for generations post-independence, but also due to the frequent assault of volcanic eruptions and cyclones which heap damage upon Vanuatu’s weak economic, social, and physical infrastructure. As I have argued ad nauseam, the global North and the EU more specifically, pursue their unambiguously political, competitive, and racist agenda against blacklisted countries in the global South, with absolute impunity. But the UN’s recently passed resolution “that would give low-and middle-income countries decision-making power over global tax affairs,” and Vanuatu’s successful appeal to the ICJ on climate change, offers some hope of fairness and justice, and demonstrates the growing global acknowledgement that small states matter. All of us — not just the smallest one.

--

--