Economic damage mounts as Venezuela earthquake grows | Stories About Earthquakes

A list of powerful earthquakes that hit Venezuela on Wednesday It could cost the economy as much as 7 percent of gross domestic product (GDP), according to preliminary estimates from the United States Geological Survey.

A preliminary assessment released on Thursday estimated that the damage could be between 1 and 7 percent of Venezuela’s $111bn GDP after two earthquakes of 7.2 and 7.5 struck about 160 kilometers (100 miles) west of the capital Caracas, Wednesday afternoon, leaving at least 188 dead.

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Former President Delcy Rodriguez has said that there will be a $200m fund from the International Monetary Fund that will be used to help rebuild infrastructure, hospitals and homes.

“Major reforms must be necessary, and this will require foreign support, including the US, actors, and international financial institutions. The government seems to have moved quickly to announce a reconstruction fund with the help of the IMF (International Monetary Fund),” Rachel Ziemba, economist and senior fellow at the Center for New American Security, told Al Jazeera.

“Further changes in jurisdiction may be necessary to facilitate remittances, remittances, and greater flexibility for imported goods.”

The US is sending aid to assess the damage and provide assistance. Secretary of State Marco Rubio said that the US has sent rescue operations, and should have a better understanding of what is needed in the next 48 hours.

“We will have a full government response,” Mr Rubio told reporters in Bahrain on Thursday amid operational difficulties as Simon Bolivar International Airport, the country’s main airport, was closed.

Experts are closely monitoring how the US response could affect their relationship.

“I think this could be an opportunity, maybe an enabler, to force or strengthen this relationship in a positive economic way,” John Deal, head of capital markets at commercial bank Post Oak Group, told Al Jazeera.

“The administration has been very interested in acquiring oil and gas assets, and it doesn’t seem that the oil infrastructure in Venezuela has been seriously damaged. Meanwhile, the country has been doing a lot of damage to the most emotionally sensitive place in Venezuela: its capital,” said Deal.

The United Nations has “reinvigorated” humanitarian efforts, an aid official said, and Switzerland has sent 18 tons of rescue equipment to help boost the capacity of government officials. Al Jazeera’s Noris Soto reported from Caracas that private companies have been asked to help clear the debris.

Difficulty of help come already a financial crisis. Of the country’s 31.7 million people, more than 20 million were already in poverty due to lack of adequate food and medicine, and many hospitals do not even have reliable water or electricity.

At Caracas’s Hospital de Clinicas, staff were asked to double the night shift to treat the injured, an employee there said. Classes were canceled for the rest of the week as officials began to see the damage.

The damage comes on top of existing health and housing problems. Venezuela’s health information is limited. The government has not published any disease-related information since 2016.

About 10 percent of the people before the earthquake in the country have been living in unsafe places due to inadequate housing, according to the report of the National Survey of Living Conditions published by researchers of the Andres Bello Catholic University in Caracas as of 2023.

Effects of oil

The earthquakes had little impact on the country’s oil and gas sector, which normally produces 1.2 million barrels per day of crude oil. The El Palito oil refinery in the central Carabobo region near the epicenter was not damaged, according to preliminary reports shared by Reuters.

Meanwhile, at the Moron Petrochemical Complex, the country’s second largest petrochemical plant, production resumed on Thursday after a temporary halt. Workers were told not to come when a preliminary inspection found a leak in the storage tank on Wednesday. It was unclear whether the leak had been repaired since the order to reopen, according to Reuters.

Chevron told Al Jazeera it was still working.

“As a long-term worker and partner in Venezuela, we stand in solidarity with the country and its people at this difficult time. We continue to support our workers and the communities around our facilities and ensure that our assets continue to operate safely,” Chevron told Al Jazeera.

Other companies, including Shell, Eni and Repsol said all employees are counted.

“The human risk may be greater than the economic one, especially if, as it appears, the electrical equipment does not seem to have been seriously damaged. Most of Venezuela’s income comes from oil, although the US sanctions reduce the entry of this money into the country,” said Ziemba, an economist.