The commercial opening with Colombia, a bitter joy among the Venezuelan business community | International
The normalization of economic relations with Colombia has been received in the Venezuelan productive apparatus with a mixture of joy and apprehension. The population and the business community of the border, as well as the commercial sector of the country, celebrate it seeing it as an opportunity to strengthen their income and leave the ruin. “I am very happy to announce that, as of September 26, we will jointly open the borders between Venezuela and Colombia. In addition, we will resume flights between Bogotá, Caracas and Valencia, “said Maduro, who also insisted on his interest in creating a special economic zone between the two nations.
“We are going to propose to President Gustavo Petro the construction of a large productive commercial economic zone between Norte de Santander (in Colombia) and the entire Táchira State. A binational zone of economic, commercial and productive development. The time has come for us to build it,” Maduro said. The announcements also contemplate the opening of consulted, necessary for the gestation of sanitary permits for the trade of goods and food.
In the bowels of the damaged industrial environment of the country, however, there is a growing concern because of the asymmetries that exist today between the economies of the two nations. Until 1998, the Venezuelan productive environment traditionally dominated the binational trade balance. But the ravages caused after 22 years of Chavismo have placed the Venezuelan economy in a situation of extreme vulnerability in the face of the powerful muscle of the Colombian economy, one of the most dynamic in Latin America in these two decades.
Some of the local business community has spent time making lobby before the Chavista administration of the Miraflores Palace, seeking to open spaces for commercial exchange with Colombia, a horizon that is a shared need, particularly in border areas, and that would surely have a positive impact on the performance of the shredded local Gross Domestic Product. The circumstance has clearly been strengthened with the arrival of Gustavo Petro to power. Diplomatic relations between the two countries have just been resumed after a three-year break, and several more political tensions and serious ideological disagreements. In the good times, the commercial exchange between Colombia and Venezuela reached 7,000 million dollars. The border closure made the smuggling of merchandise, fuel and the opening of illegal trails a generalized issue.
“If conditions were good, everyone would celebrate the opening of the border with Colombia,” says businessman Jorge Roig. “The problem is that here there is no specific public policy to protect the country’s industrial sector, which has been hit so badly in recent years. The Venezuelan industrialist has a serious problem with parafiscal taxes, which greatly affect the cost structure and prevent him from competing with foreign products. In the industrial sector there is fear, it is necessary to protect a sector that today has barely 1,500 industries, working at 35% of its capacity, after having had 12,000 a few years ago. If there are no decisions to protect the national industry in the face of a much more powerful economy, the consequences will not be good”, he maintains.
The economist and director of the firm Síntesis Financiera, Tamara Herrera, agree that “at this time, the Venezuelan economy, manufacturing in particular, is not in the best conditions to take advantage of this opening, even despite the efforts of recovery of these months. “It may be that some niches achieve some comparative advantages, some specific Venezuelan investments, but the positive aspects that are expected will take time to arrive. Colombia is much better prepared for this opening,” she adds.
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The official announcements of economic and diplomatic opening benefit in a particular way the population universe of the binational border between both countries. The Colombian peso is the currency that everyone recognizes as valid and relevant on both sides of the border. For Herrera, “if Venezuela does not finalize a national agreement to resolve the wrongs of the political crisis of these years, if the sanctions are not lifted to restore the confidence of capital, if international credit does not return, not much progress can be made, although there are many entrepreneurs striving to increase productivity”.
At least two binational business meetings have taken place these weeks in San Cristóbal (Venezuela) and Cúcuta (Colombia) to gauge comparative advantages and investment opportunities. “Many Venezuelan industries in Ureña, on the Venezuelan side, have moved to Cúcuta due to the deficiency of local services,” says Tiziana Polessel, director of the employers’ association Consecomercio. “There are many established industries in Colombia that are owned by Venezuelans. The exit from the Andean Community of Nations forces us to reestablish links and markets that we have lost”.
Polessel points out, however, some advantages and areas of opportunity in this opening. “In Colombians we have noticed a lot of interest in working to reactivate the tourism sector, for them Venezuela was an important destination, particularly the island of Margarita. The return of commercial flights is good news for everyone. There are some medicines made in Venezuela that the Colombians are not producing. In the educational sector, there is a huge opportunity in terms of doctorates and postgraduate degrees. There are also competitive advantages in human talent in technology”.
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