President Nicolás Maduro ‘is now the national assembly’, says assembly’s leader after court rules it can assume congressional duties

Venezuela has lurched further away from democracy – and closer to confrontation with its regional neighbours – after the pro-government supreme court assumed the legislative powers of the opposition-controlled congress.

Judges ruled that lawmakers were in contempt of court because they were holding up efforts to revive the crisis-stricken economy. Opposition congressmen decried the move by the justices as a step towards dictatorship.

In protest, Peru recalled its ambassador to Caracas and promised to step up efforts to eject Venezuela from the Organisation of American States for what it called a “flagrant breach of democratic order”.

The United States condemned what it described as a move to “usurp the powers” of the national assembly.

“This rupture of democratic and constitutional norms greatly damages Venezuela’s democratic institutions and denies the Venezuelan people the right to shape their country’s future through their elected representatives. We consider it a serious setback for democracy in Venezuela,” the state department said in a statement.

President Nicolás Maduro lost control of congress in December 2015 when voters – angry about soaring inflation, rising poverty and shortages of medicines and basic commodities – inflicted a heavy legislative election defeat on the ruling United Socialist Party of Venezuela.

Since then, relations between the administration and the legislature have been stuck between tension and conflict. Last year, the government quashed an attempt to force a recall referendum, prompting street protests.

Vatican-backed efforts to bring the two sides to the negotiating table broke down in November as the economy spiralled further out of control.

Julio Borges, the legislative assembly president, said the supreme court’s move allowed Maduro to rule by fiat. “Maduro is now the national assembly,” he told the Associated Press. “It’s one thing to try and build a dictatorship and another to complete the circuit.”

Gerardo Fernández, a professor of constitutional law at the Andrés Bello Catholic University in Caracas, said the move proved there was no longer a separation of powers in Venezuela.

“We are on the margins of democracy, outside the rule of law, where a dictatorship has been imposed,” he said.

The OAS secretary general, Luis Almagro, accused Maduro’s government of carrying out a “self-coup”, using a term which evoked Peru’s 1992 constitutional crisis prompted a power-grab launched by then president Alberto Fujimori.

Opposition leaders are now calling for a new wave of street demonstrations, prompting fears of a repeat of the deadly violence seen in recent protests.

Freddy Guevara of Voluntad Popular – the party of imprisoned opposition leader Leopoldo López – said the measure showed the government was close to breaking point. “We must wake up and take advantage of this deplorable step by the regime by organising and lifting the spirit of unbowed, democratic resistance.”

Government supporters blamed the intransigence of the national assembly for the move, saying the country was paralysed by the blocking of the budget ahead of the year-end settlement of accounts.

“This came about due to extremism on the part of the constitutional chamber, which destroyed the functions of the legislature,” said Rocío San Miguel, president of the NGO Citizen Watch on Security, Defense and Armed Forces.

Maduro says he is the victim of an “unconventional war” waged by the US to get their hands on vast Venezuelan reserves of oil.

However, he has acknowledged the crisis his country faces by appealing to the United Nations to help boost stocks of medicine that local doctors say are in perilously short supply.

The economic, political and humanitarian crisis has had an impact beyond Venezuela’s borders. Border tensions with Colombia have increased. Brazil is dealing with increasing numbers of refugees.

Disputes have also erupted in the OAS over moves by Almagro to invoke the organisation’s democratic charter and expel Venezuela for human rights violations.

Mexico, Paraguay and Argentina are among those in favour of such a move, while Bolivia, Cuba and Venezuela are in the group against.

No action has been taken, but 14 nations – Argentina, Brazil, Canada, Chile, Colombia, Costa Rica, the United States, Guatemala, Honduras, Mexico, Panama, Paraguay, Peru and Uruguay – have called on Venezuela to hold fresh elections.