The Venezuelan regime vs. private enterprise

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Private companies have been terribly attacked by the Venezuelan regime from day one, as they are ideologically unacceptable. Because it came to power through electoral means, it has been unable to nationalize everything, as did the communist regimes in the rest of the world. So the regime has engaged in systematic harassment, which included all kinds of company takeovers, threats, taxes and controls. The destruction of the economy and the oil industry in particular has been of such magnitude that in recent months the regime has been forced to dismantle some controls, and it has been the private sector that has allowed foreign exchange and commercial movement. Now there is pressure from the regime to create and take over “its business community” and the possibility of a sector of the business community seeking to convince the rest that it can co-govern with the regime. In this + 58Report we review “The Private Enterprise in Venezuela”, “Private companies and politics” and “The political sectors in redefinition”.

The private enterprise in Venezuela

The private enterprise operates while the conditions that allow it exist and it has to stop doing so when there is no expectation of the future, it also does so with its own capital and / or guarantees. On the other hand, even if you don’t directly do business with the state, you can’t ignore it either. The different agencies that collect taxes or other types of obligations, the multiple public services, the “collections” of uniformed personnel and “civil protection” are realities that you will always have to deal with. In addition, in Venezuela, the private sector has had to survive forced to sell at a loss, under the threat of being sanctioned or being closed at any time or of simply losing the company altogether.

In this environment, the difficulty of doing business is a reality and includes the increased operational cost with the multiple tax declarations and payments that must be made. This is a burden that makes it more expensive and difficult to compete in an international market. Generally, as long as it was feasible, the decision of the Venezuelan businessman has been to stay in his country, since it is the market he knows and it is very difficult to start in another. Once the regime out of necessity had to cut controls, a number of businessmen have risked their own capital, aware of the fact that they can be annihilated at any moment. Those are the ones that keep commercial life going in Venezuela, it is with their currencies that the market operates. Of course, as in all activities, there are good and bad participants and circumstances favor the latter.

Private companies and politics

The businessman always and in all parts of the world participates in politics, typically providing resources to the party or parties that he thinks will create more favorable conditions for private enterprise. There are also those who expect some future benefit, in this case as long as it is legal there is no reason to blush. In countries where democracy has less roots, the need for private business to participate becomes greater and implies investing and supporting in that what makes the country more solid. The Venezuelan oil brought many deformations and from the business perspective, a significant percentage of businessmen benefited from the protection that prevented competition. It is enough to remember how important businessmen, some associated with Fedecamaras, were decisive in the torpedoing of the extraordinary liberalization effort that Carlos Andrés Pérez attempted in his second government in the early 90s.

Could it be that they will make the same mistake again? It is enough to read an editorial in Analítica: “Now, business and mainly commercial sectors, supported by some public figures who “specialize” in opinion polls, insist once again that this is the time to participate, that we must not give up more spaces to the regime, that if we all vote, victory is assured. If that utopian vision were a reality, also trusting that the majority would be willing to participate in a new and useless and fraudulent election, do you think that a regime that is not even willing to negotiate its exit will hand over the governorships of the main states in the country to those who are not part of the game? Well, obviously not, as has already happened with the fraudulent parliamentary elections, those who played the game were shorned and only gave them ‘burusas’. ” Interestingly, the regime now needs the businessmen. It is time to take advantage of that reality to demand more.

The political sectors in redefinition

On the surface, you might think that nothing is happening in the political world in Venezuela. However, major changes are underway on both sides. The information in the international press reflects the weakening of the position and support for Juan Guaidó and the National Assembly, confirming their own decision to limit themselves in size and presence. Unfortunately, the opposition’s mistakes and the brutal pressure and repression by the regime have influenced for this to happen. Leopoldo López announces from the outside a new format of unity, which does not seem at all easy to conform and especially coming with an isolated statement from the main architect of the Guaidó-NA strategy. Added to this there are opposition politicians who want to negotiate at any price, who call themselves “moderates” and call the G4 / NA “salidistas” (in favor of street pressure).

But there is also noise on the regime’s side. Maduro and the Communist Party (the only ally party that has not been intervened by the government so far)  throwing public darts almost daily and the internal struggle that led to the replacement of Erika Farías as Caracas’ “protector” was also observed. Are the resources to be distributed becoming scarce? Could it be that the political dominance over the opposition is such that more internal conflicts start?

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