Every economic catastrophe brings soul-searching. When Argentina collapsed at the end of 2001, the International Monetary Fund was forced into a critical assessment of its involvement in the country. Similar processes were triggered at the World Bank after unsuccessful development projects in Africa. The coming implosion of the Venezuelan economy should prompt similar introspection — not at the IMF, which has been absent since its “expulsion” by President Hugo Chávez in 2007, but in China.

It is hard to exaggerate the magnitude of the Venezuelan collapse. People are queueing for hours to buy food, stores are empty, and the country is in a deep recession. Venezuela has the fastest inflation in the world, while its government debt is the most expensive to insure against default.

How did we get here? Venezuela used the period of high oil prices to quadruple its public foreign debt, in order to fuel a domestic spending boom. By 2012, when Venezuelan oil averaged $103, the country was spending as if the price was $194, running up a fiscal deficit of 17.5 per cent of gross domestic product. That is why the economy went into crisis in early 2014, when the oil price was still $100. The recent drop has just made a hopeless situation worse. Who gave the country the rope with which to hang itself? Mostly China.