What next for Venezuela? Everything you need to know about the country with two presidents

  • Alongside several other countries, the U.S. immediately recognized Guaido as the Latin American country's rightful interim leader, ramping up the pressure on President Nicolas Maduro.
  • It has thrust Venezuela into uncharted territory — with the oil-rich, but cash-poor, country in the midst of the worst humanitarian crisis in the Western Hemisphere in recent memory.
Juan Guaido, President of Venezuela's National Assembly, reacts during a rally against Venezuelan President Nicolas Maduro's government and to commemorate the 61st anniversary of the end of the dictatorship of Marcos Perez Jimenez in Caracas, Venezuela January 23, 2019.
Carlos Garcia Rawlins | Reuters
Juan Guaido, President of Venezuela's National Assembly, reacts during a rally against Venezuelan President Nicolas Maduro's government and to commemorate the 61st anniversary of the end of the dictatorship of Marcos Perez Jimenez in Caracas, Venezuela January 23, 2019.

Political tensions in crisis-stricken Venezuela are reaching boiling point.

It comes after opposition leader Juan Guaido stood in the streets of the capital city last week and declared himself as the country's "acting president."

Alongside several other countries, the U.S. immediately recognized Guaido as the Latin American country's rightful interim leader, ramping up the pressure on President Nicolas Maduro.

It has thrust Venezuela into uncharted territory — with the oil-rich, but cash-poor, country in the midst of the Western Hemisphere's worst humanitarian crisis in recent memory.

So, what happened exactly? Why is this political crisis unique? And where do we go from here?

What happened?

Growing unrest in Venezuela follows years of economic mismanagement, repression and corruption.

Millions of people have been driven out of the country amid hyperinflation, power cuts and severe shortages of basic items — such as food and medicine.

At the start of the month, Venezuela's Maduro was sworn in for a second term. It followed an election marred by an opposition boycott and claims of vote-rigging.

The result prompted a fresh wave of deadly street demonstrations against Maduro's administration.

It culminated in Guaido, the elected leader of Venezuela's National Assembly, naming himself as the interim president on January 23.

Why is this crisis unique?

Guaido's claim to the presidency is unique, in large part because it has been recognized abroad as legitimate.

It means Venezuela has been thrust into a situation whereby it has an internationally-recognized government — with no control over state functions — running parallel to Maduro's parliament.

An anti-government demonstrator stands next to a national flag during an opposition protest blocking the Francisco Fajardo highway in Caracas on May 27, 2017.
LUIS ROBAYO | AFP | Getty Images
An anti-government demonstrator stands next to a national flag during an opposition protest blocking the Francisco Fajardo highway in Caracas on May 27, 2017.

Complicating matters further, President Donald Trump's administration has said it will sanction Venezuela's state-owned oil firm.

For years, the White House had held back on targeted crude sanctions against Caracas, fearing it would raise oil prices and ultimately hurt American refiners.

But, in a dramatic bid to oust Maduro, Washington has sought to ratchet up the pressure on the socialist premier.

"The gamble is a bold one as, the U.S. has played its strongest card and is now seemingly out of non-military options on Venezuela," Fernando Freijedo, Latin America analyst at the Economist Intelligence Unit, told CNBC via email.

"We had expected the U.S. to work its way up to sanctions as a form of building pressure within the regime … However, the use of military force continues to seem unlikely as it would almost surely come with costs in terms of legitimacy for the U.S. and the opposition," Freijedo said.

Which countries still support Maduro?

The international community is not united behind Guaido.

Those still in support of Maduro's presidency include; China, Iran, Russia, Turkey, Cuba, Bolivia and Nicaragua.

Moises Naim, a former Venezuelan minister now at the Carnegie Endowment for International Peace, said via Twitter at the end of last week that this group should be referred to as the "autocrats' alliance."

Of those in support of Maduro, the EIU's Freijedo said Russia and China are the "wildcards."

"We see China unwilling to heavily bet against the U.S. and risk souring relations in the midst of trade negotiations. Similarly, we see Russia as more interested in dealing with its own sanctions and, unlike China, financially unable to bankroll the Venezuelan regime," he said.

What is happening on the ground?

Maduro has presided over Venezuela's spiral into its worst-ever economic crisis, with hyperinflation forecast to reach 10 million percent this year.

As a result, some 3 million Venezuelans have fled abroad over the past five years to escape worsening living conditions.

Nicolas Maduro, Venezuela's president, speaks during a televised press conference in Caracas, Venezuela, on Friday, Jan. 25, 2019.
Carlos Becerra | Bloomberg | Getty Images
Nicolas Maduro, Venezuela's president, speaks during a televised press conference in Caracas, Venezuela, on Friday, Jan. 25, 2019.

At Guaido's request, one nationwide anti-government protest took place on Wednesday, with another major demonstration scheduled on Saturday.

The timing of the second rally is significant because several European countries, including Spain, Germany, France and Britain have said they would also recognize Guaido as president if elections were not called by Saturday.

Maduro has rejected this, saying the ultimatum must be withdrawn.

What happens next?

What happens over the coming days appears to hinge on the actions of the country's military.

For now, high-ranking officials remain supportive of Maduro's government.

"Autocratic regimes with military backing can sometimes withstand international pressure for a long time. And while Guaido is riding a wave right now, he will have to capitalize on domestic and international support," Tom Long, assistant professor in the department of politics and international studies at the University of Warwick, told CNBC via email.

"Of course, it is not clear where this goes, but the risks of confrontation are as high as they have ever been," Long added.

Demonstrators shout slogans while a barricades seen burning in the background during a demonstration against Nicolas Maduro policies. Rally against the government of Venezuelan President Nicolas Maduro and also to commemorate the 61st anniversary of the end of Marcos Pérez Jiménez's dictatorship in Caracas.
Roman Camacho | SOPA Images | LightRocket | Getty Images
Demonstrators shout slogans while a barricades seen burning in the background during a demonstration against Nicolas Maduro policies. Rally against the government of Venezuelan President Nicolas Maduro and also to commemorate the 61st anniversary of the end of Marcos Pérez Jiménez's dictatorship in Caracas.

Political analysts told CNBC last week that it is certainly possible escalating pressure from the international community could encourage lower-ranking officials to turn against Maduro's government.

But, presently, there have been no high-ranking defections in Venezuela.

"The next days are crucial in the attempt to get the military to separate itself from Mr Maduro. The opposition, U.S. (and wider international community) have done more in the past month than they have in years to achieve it," the EIU's Freijedo said.