For those brave enough to be interested in the high-stakes, high-yield game that constitutes investing in Venezuela, last week saw another little step forward.

Given the disastrous state of the economy, it will take a wholesale overhaul of government policies to start the repair process — and that will require regime change. In the way stands President Nicolás Maduro, who is being seen as the key obstacle not only by opposition politicians but, increasingly, by his own supporters, the chavistas … and indeed, by most ordinary Venezuelans.

Hence, the opposition has launched a bid for a recall referendum that would cut short the president’s current four-year term and open the way for a fresh election that the candidate from MUD, the opposition umbrella group, would surely win. After all, it gained control of the lower house of parliament in 2015 after years in the wilderness under former president Hugo Chávez.

In order to hold such a referendum, the opposition first needs 20 per cent of the country’s 19.5m registered voters to sign a petition asking for one. Again, this should be a breeze. According to recent opinion polls, some 11m voters would be willing to sign. So it is good news that last week the electoral council (CNE) finally announced the conditions for holding this plebiscite, after months of delays.

The bad news is that the CNE, stacked with government appointees, is making it as difficult for the opposition as possible. Instead of just requiring a 20 per cent sign-up rate nationally, it is mandating this for each of Venezuela’s 24 states. That includes several small states, such as Amazonas, that are rural, far from the capital Caracas and traditionally chavista strongholds.

On top of that, the CNE is also limiting polling hours and, indeed, the number of polling stations and machines, to make it even harder to collect the necessary 3.9m votes. These conditions are so harsh that MUD has already called them unconstitutional and is weighing up launching a series of protests, further raising political tensions.

In the end, however, the electoral council’s manoeuvres may slow but will not stop political change, argues Medley Global Advisors, a macro research service owned by the FT. Either these shenanigans will simply motivate enough angry and desperate citizens to sign up to get over the one-fifth threshold, or, if the CNE were to declare the referendum to have failed, popular outrage would force it to back down.

Importantly, as MGA points out, Mr Maduro and his government no longer enjoy the universal backing of the chavismo movement in the way that Chávez did. At this point, the chavistas are an unstable coalition and the more rational elements within it — including certain factions in the military — accept they will probably lose power and are focusing on preserving what they can (personal gains, personal immunity) in the process.

For them, their increasingly radical president is in the way and if they can see him removed by the opposition and in a democratic way (rather than through a military coup, say), it will make it easier to keep what is left of chavismo together.

So Mr Maduro’s days appear numbered and, ultimately, a new government that restores order and reboots the economy will be good for Venezuela and its assets. But in the meantime, investors in its bonds face continued volatility, a depressed oil price and a possible default, or at least a haircut on their holdings. When the new Venezuela will emerge and what it might look like still remain very uncertain.

Dan Bogler is a commissioning editor at Medley Global Advisors

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