Demonstrators march underneath a large Venezuelan flag during a pro-opposition rally in Caracas, Venezuela, on Wednesday, Jan. 23, 2019. President Donald Trump recognized Juan Guaido as the interim president of Venezuela minutes after the opposition leader declared himself the head of state, in the U.S.’s most provocative move yet against the leftist regime of President Nicolas Maduro. (Bloomberg)

Once one of Latin America’s richest countries, Venezuela has been laid low. Its economy has collapsed, plagued with shortages of everything from toilet paper to antibiotics and food. And it’s not entirely clear who’s in charge any more. Complaining of mismanagement, corruption and political oppression, opponents of President Nicolas Maduro have declared his government invalid and one of their own his replacement. Power outages and water shortages that spread throughout the country for most of March sparked protests against Maduro. But the two sides remain locked in a standoff over who is the legitimate authority in Venezuela.

1. Who’s in charge in Venezuela?

While Maduro and opposition leader Juan Guaido both claim to be president, Maduro still has control of key assets including the military, media, police and state-run oil company Petroleos de Venezuela SA, or PDVSA. Guaido, the president of the opposition-dominated National Assembly, announced Jan. 23 that he had assumed Maduro’s powers atop a caretaker government until new elections can be held. His move has been recognized by the U.S., Brazil, and dozens of other countries. The Organization of American States and the Inter-American Development Bank have recognized Guaido’s picks to the institutions. Blaming Washington for orchestrating the effort to remove him, Maduro broke diplomatic relations with the U.S. In April, his regime stripped Guaido of the immunity from prosecution enjoyed by members of the assembly, opening the door to his arrest.

2. What could tip the balance?

Rank-and-file army support shifting to Guaido would be a major blow to Maduro. He is the protege and successor of Hugo Chavez, the leftist army colonel who was first elected president in 1998 after having been imprisoned for leading a failed coup in 1992. Top leaders of the military have benefited under the regime from government contracts and mining concessions as well as their control of ports and PDVSA. Guaido has sought to lure officers by offering amnesty to those who defect, yet no active top officers who command troops have broken ranks.

3. Anything else?

Control over Venezuela’s oil reserves, the largest in the world, could prove critical. Oil accounts for the overwhelming majority of Venezuela’s income. The U.S. has issued sanctions on PDVSA that effectively block Venezuela from exporting crude to the U.S., its biggest customer. American companies are barred from selling Venezuela the light oil it needs to dilute its heavy crude, further hindering PDVSA’s ability to export.

4. On what grounds does Guaido claim the presidency?

With the backing of the U.S. and other countries, Guaido has argued that Maduro’s May 2018 reelection was illegitimate. With that as the foundation, Guaido cites Article 233 of Venezuela’s constitution, which invests temporary presidential power in the head of the National Assembly when the presidency is otherwise vacant. In a column for the Washington Post, Guaido also cited Article 350, which says Venezuelans “shall disown any regime, legislation or authority that violates democratic values, principles and guarantees or encroaches upon human rights.”

5. Why is Maduro’s 2018 reelection in question?

Maduro’s election to a second six-year term was marred by the jailing and disqualification of opposition politicians -- most of whom ultimately joined a boycott of the vote -- along with the coercing of government workers to vote and reports of fraud. The result was dismissed as illegitimate by the U.S., the European Union and the 14-nation Lima Group, formed to help restore democracy to Venezuela.

6. Isn’t it early to recognize a new Venezuela government?

In a way, yes. Typically, governments recognize leaders that have effective control of their countries. There are exceptions. In 1989, the U.S. withheld recognition of Manuel Noriega as Panama’s leader after he canceled elections in which polls had him trailing badly. (Three months later, the U.S. invaded and Noriega was deposed.) In 2011, the U.S. recognized Libyan rebels as their nation’s governing authority even while Muammar Qaddafi was still fighting to hold onto power.

7. What nations still back Maduro as president?

Russia and Bolivia continue to recognize Maduro as Venezuela’s rightful leader, as does China, which has said it “opposes foreign forces from interfering into Venezuela affairs.” Early on, President Recep Tayyip Erdogan of Turkey, who survived an attempted coup in 2016, called Maduro to say, “Stand tall, we are with you.”

To contact the reporter on this story: Patricia Laya in Caracas at playa2@bloomberg.net

To contact the editors responsible for this story: David Papadopoulos at papadopoulos@bloomberg.net, Laurence Arnold, Bruce Douglas

©2019 Bloomberg L.P.