Venezuela is experiencing one of the decisive moments in its history. The interim government of Delcy Rodríguez faces the reconstruction of the country after the devastating earthquakes that shook the north of the country on the afternoon of June 24 amidst pressure from the United States to initiate a democratic transition process. The quakes left almost 5,300 dead and nearly 20,000 injured due to the collapse of hundreds of buildings and facilities that have left thousands of families homeless. The material damage has left a desolate panorama. The World Bank Group estimates that the losses derived from the catastrophe amount to 19.6 billion dollars (about 17.2 billion euros). “The extent of the damage underscores the importance of timely reconstruction for Venezuela’s economic recovery,” it notes in a report published this Thursday.
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Officials from the Washington-based multilateral organization have released the calculation of the damage caused by the earthquakes in the La Guaira and Caracas area. 47% of the damage occurred in residential buildings, followed by infrastructure (27%) and non-residential buildings (26%), according to the World Bank’s assessment. The European Copernicus service detected 434 collapsed properties in the areas affected by the earthquakes, and a total of 1,304 that could have been damaged. Thousands of homes, hospitals, and schools registered significant damage. Preliminary analyses by academic institutions suggest that tens of thousands of buildings suffered some degree of damage.
The State of La Guaira (especially in sectors such as Catia la Mar and Caraballeda) and the metropolitan area of Caracas were the most affected areas, accounting for about half of the total damage, highlights the report from the organization chaired by Indian Ajay Banga.
“This assessment provides the Government of Venezuela and its partners with an early objective basis for recovery planning, and the World Bank Group is committed to supporting that effort every step of the way,” said Susana Cordeiro Guerra, World Bank Vice President for Latin America and the Caribbean. “The earthquakes have disrupted lives, damaged critical infrastructure, and created new challenges for Venezuela’s recovery,” she added.
UNICEF warns that 1.8 million people, including 680,000 children, need humanitarian assistance after the catastrophe. The situation is critical in the Latin American country, which lacks resources to face devastation of this magnitude and threatens to unleash a health crisis in the country, as warned by the Pan American Health Organization (PAHO).
The World Bank has prepared the damage report with the aim of disseminating “the magnitude of the reconstruction task and prioritizing recovery and reconstruction efforts, as the country faces one of the most significant disasters in its recent history.”
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The report is published a week after a total of 14 Democratic Party congressmen sent a letter to US President Donald Trump, requesting him to lift economic sanctions on Venezuela so that it can cope with the catastrophe and devastation caused by the two earthquakes. In their petition to the Government, the US legislators demand the “immediate end of the broad US economic sanctions against the country and to do everything in their power to facilitate Venezuela’s access to its frozen assets abroad.”
The World Bank explains that, due to Caracas’s scarcity of resources, with a low level of public and private investment, reconstruction would largely have to be financed by redirecting resources from other projects. The country has been in a recession since the United States imposed a strict economic embargo on the Chavista regime in 2017. Since then, Venezuela’s GDP has contracted by 74% over the last 10 years, according to IMF data.
“In this scenario, reconstruction would remain incomplete over a ten-year horizon, with lasting negative effects on economic activity,” warn the economists of the multilateral organization. “A faster reconstruction effort supported by greater public and private investment would mitigate the economic and social impact of the earthquakes,” it emphasizes.
More than a hundred economists signed a manifesto two weeks ago calling on the Trump Administration to act “immediately to free Venezuela’s humanitarian response and reconstruction from ongoing economic and financial sanctions, asset freezes, and onerous debt burdens.” They ask the White House to lead efforts to secure the release of more than 15 billion dollars in frozen Venezuelan funds, including IMF financing mechanisms.
“The World Bank Group is working with the Government of Venezuela and its development partners, including the Inter-American Development Bank (IDB), and the Development Bank of Latin America (CAF), to define the additional technical and financial support needed for damage and additional needs assessment, recovery, and reconstruction,” the report concludes.