US Sanctions Against Venezuela 'Will Succeed,' State Department Official Says

A continued, prolonged power struggle between Nicolas Maduro and the Juan Guaido-led opposition party in Venezuela may leave the effectiveness of U.S. sanctions in doubt, said Elizabeth Rosenberg, a former senior sanctions adviser at the Treasury Department.

Speaking during an Oct. 23 panel at the Center for Strategic and International Studies, Rosenberg said the sanctions’ inability to enact a regime change -- despite their effectiveness at restricting funds to Maduro -- could mean the U.S. may have to take a different approach. “If that goes on for the long term, we may look at these sanctions authorities and discern that in fact they are not achieving their purpose,” Rosenberg said. “So one of the takeaway lessons could be that it’s a start, but it’s inadequate to meet the policy objective here.”

Speaking before the panel, Carrie Filipetti, deputy assistant secretary for the State Department’s Bureau of Western Hemisphere Affairs, said she is “very confident” that U.S. sanctions “will succeed.”

“This is not pressure for pressure’s sake,” Filipetti said. “It is pressure to lead to a political solution.”

Although Rosenberg said certain aspects of the Venezuelan sanctions regime are working, such as constricting the country’s oil and mineral sectors and convincing U.S. partners to coordinate on pressure against Venezuela, she suggested that sanctions may not be the right policy tool. “It’s not going to achieve success in every instance,” she said. “And just because it has in some cases doesn't mean we should reach for it immediately.”

But Rosenberg also said sanctions will continue to be a vital part of the Trump administration's policy tool belt no matter the outcome in Venezuela. “They are very popular not just by certain constituencies in the United States, including the U.S. administration, but by many other countries around the world,” she said. “And they're not going away.”

Filipetti acknowledged that sanctions are “not a silver bullet,” and that the U.S. may have to force Maduro to give up power by other means. But she also said U.S. sanctions will continue. “We’re obviously going to continue to deploy sanctions. It's something that we've seen has been the most effective strategy to date to get the regime to the negotiating table,” she said, adding that the U.S. wants Europe to be more active in pressuring Maduro. The U.S. continues to “ask them to do more to implement economic pressure,” she said.

Eric Lorber, a former senior adviser for Treasury’s undersecretary for Terrorism and Financial Intelligence, said that even though the sanctions program has not yet pushed Maduro out, it has been a model example for how the U.S. should deploy its sanctions. Lorber said the sanctions were increased slowly on the right people and sectors and correctly targeted attempts at evasion by limiting the Maduro regime’s ability to find funding through the gold sector.

“The program itself has actually increased pressure in an incremental but very logically coherent kind of way,” Lorber said during the panel. “And you don't really see that with sanctions programs.”

Venezuelans are concerned about how U.S. sanctions could impact the Venezuelan oil industry after Maduro loses power because of how long the measures have been in place, panelists said. Rosenberg said the sanctions have been in place longer than expected. “I think, among some constituencies, there was an expectation that sanctions pressure and international pressure would cause a political transformation more rapidly,” she said. “That hasn't happened.”

Francisco Monaldi, a Latin American energy policy fellow at Rice University, said the sanctions could have lasting effects after they are lifted, hurting companies and the country's oil industry. “One thing that I'm worried about is that even when sanctions are lifted, nobody wants to touch a company that has been sanctioned in the past,” he said. “The private sector sometimes has incentives for overcompliance.”