Venezuela is a country where investing and generating profitability has become complicated, but not impossible. The recent reforms made by President Nicolás Maduro seek to make the economy more flexible and promote private commercial activity in the country. Allowing interbank foreign currency transactions to keep afloat the different companies that are still betting on the industrial development of the region. In addition, the opportunity to manufacture products in a market with little domestic competition has made Venezuela a fertile land for foreign investment. In this article we will talk about the 3 most solid industries to invest in Venezuela in 2022.
1- The oil industry adjusts to the global energy demand.
Currently, there are different industries that are of great interest to businessmen, especially in the chemical, telecommunications, health and food sectors. But one of the most profitable in Venezuela has always been and will continue to be the oil industry. Although the country is located in one of the largest oil reserves in the world, its mining culture has been shaped by technological advances from other countries.
Following the recent drop in oil production in Libya, supply became scarce in the growing energy demand facing the world in the wake of Covid-19. Oil prices have risen significantly since 2009 to 76 $ per barrel, which responds to the high demand for fuels due to the reactivation of flights and other commercial activities.
Venezuela is not lagging behind in this contest as it seeks ways to commercialize the extra heavy oil it produces on a daily basis. Thanks to agreements with Iran, it has been able to consolidate stable blends capable of competing in the light oil market led by Saudi Arabia and U.S. shale. These technological advances only show us that it is possible to stimulate economic activities through less expensive fuels and energy sources. In other words, a country like the United States, which is close to achieving energy independence by the year 2035. It has been able to do so thanks to the investment made in new technologies for the extraction and production of unconventional oil and gas.
Foreign investment for the technological development of the oil industry in Venezuela
That is why Venezuela has a lot of potential, but it must channel investments towards new extraction technologies. In the last 150 years the fossil fuel industry has dominated the market and Venezuela has gradually adjusted to the new times. Although political constraints impede the smooth development of this industry, they are not a determining factor for the decline of any business associated with fossil fuels. Venezuelan oil. In fact this is a solid industry to invest in for those looking to acquire infrastructure at low costs to modernize their operations. This series of purchases and sales of drilling machinery is feasible in the country, and the government is willing to grant concessions and licenses to those who comply with the requirements established by law.
2- Factories for the elaboration and manufacture of chemical products
Another of the 3 solid industries to invest in this 2022 is the manufacture of chemicals for household hygiene, paints, varnishes, among others. In Venezuela there are private factories that are constantly modernizing in order to supply the demand for these types of products at a national level. Although most of them are constantly changing owners, these types of factories specialized in the production of chlorine and other chemical products manage to remain stable. This is due to the high demand and little competition at the time of placing the products in the warehouses.
Although many claim that this industry has had a low blow thanks to the large scale importation of this type of products. The manufacture of these imported raw materials continues to be profitable in Venezuela. Although it is not easy to insure against the risks presented by the Venezuelan market, solid guarantees can be provided to venture capital.
In fact, there are already consolidated companies in the chemical industry in the country. In the case of Plastitec Group is an organization dedicated to collecting PET bottles and containers for reuse as food grade plastic. This company was born under foreign capital and the initial investment was focused on the technological modernization of a smaller organization. The high demand for the final product sustains its business activities in a volatile environment where it is necessary to import chemicals and finished products to sustain the economy. For many these types of companies are an example of the opportunities that exist in the country.
3- Growth of private companies related to telecommunications and electronic products
In the case of telecommunications services, the facts show that the nationalizations were not effective and many of these companies are on the verge of bankruptcy. The opening of the market to foreign investment has allowed private organizations to provide alternatives to users. The lack of adequate infrastructure is a constant problem in the industry. This is evidence of the need for large-scale investments with long-term returns.
On the other hand, the country is opening up to a commercial exchange stimulated by electronic competition of all kinds. The acceleration of consumption as a result of the Covid-19 pandemic caused traditional marketing models to be established on the Internet. As a result, the importation of cellular equipment, computers and other electronic devices grew at the same time that sales and repair of electronic equipment became profitable. This is evidence that there are unexplored opportunities in the technology industry and this niche will remain stable thanks to the importation of products.
In these circumstances, Alan Aldana & Abogados offers its advisory services for the formation of foreign capital companies in the country. These 3 industries are the most solid to invest in Venezuela, so we can guide you in any legal and tax aspect for your operations. What we seek is that you can have the confidence and necessary support in every aspect of your business to develop your commercial activities according to national and international regulations.
If you would like more information or need advice on this and other issues of criminal and commercial law, do not hesitate to contact us at contact us at. We also share with you our social networks so that you can keep updated on the legal topics that are in trend: Instagram, Facebook, Twitter y Linkedin.