“We are preparing for exactly this moment,” German-Venezuelan businessman Thilo Schmitz tells DW.
“I’m sure we will do very good business in the next five years,” predicted the 59-year-old Caracas-born entrepreneur. By “this moment” he means Venezuela’s reopening after years of decline.
Venezuela is changing rapidly since the kidnapping of Venezuelan President Nicolas Maduro by United States special forces on January 3. Although interim President Delcy Rodriguez, Maduro’s former deputy, is handling official business, Schmitz is confident the US is taking a tough stance.
“At the economic level, Americans are making all the decisions,” Schmitz said.
Venezuela opens oil field
In late January, Venezuela – which has the world’s largest oil reserves – opened the oil sector to foreign investment. After two decades of state control, efforts are now underway to attract private companies bringing expertise and capital. US delegations visit Caracas on a regular basis. Recently, the World Bank and International Monetary FundAlso resumed relations with Venezuela.
In January, DW spoke to Schmitz following the ouster of President Maduro. He was one of the very few business owners in Venezuela to speak publicly.
“People have high expectations,” says Schmitz, who took over his father’s stationery company in 1996. Today, Schmitz also deals in gluten-free foods and, from 2022, medical technology in Germany. According to Schmitz, the company now has 50 employees, with revenues reaching $45 million (€38 million) in its best years.
“The old elite is still there”
The German-Venezuelan Chamber of Commerce and Industry (Cavanel) estimates that only ten German companies are present in Venezuela today. But for many years, the country was seen as a gateway to South America for German industry. Compared to the ongoing violent conflict in neighboring Colombia, Venezuela was considered economically stable, offering a good quality of life.
However, after Hugo Chávez took office in 1998, many companies began to leave Venezuela. Nicolás Maduro’s regime, which began in 2013, as well as increasing US sanctions, further accelerated the migration.
Although there is new hope for economic recovery among some of the stalled companies, they are reluctant to talk. Siemens and Linde did not respond to DW’s request for comment at the time of publication.
Meanwhile, Bosch confirmed that it will no longer do business in Venezuela.
“At this time, it is still too early to assess Venezuela’s future economic potential,” a Bosch spokesperson told DW.
A German entrepreneur, who works in rural Venezuela and spoke to DW on condition of anonymity, said: “Theoretically, Donald Trump has only cut off the head of the Hydra; the old ruling elite is still there.”
He said the current phase is important because interim President Delsey Rodriguez knows she cannot continue like this. He hopes that now people will also benefit from government revenue.
“If there is no lasting change now, people will take to the streets again, despite ongoing repression. And those who have left Venezuela will not return,” he said.
“Everything needs to be rebuilt.”
Mismanagement under Venezuela’s socialist governments has had devastating effects. an estimated eight million VenezuelansHave left the country, including many highly educated people. Today, 28 million people still live in Venezuela, which has seen economic output decline through 2024 and inflation to exceed 400%.
Thilo Schmitz, who witnessed the decline firsthand, believes Venezuela’s economy can only improve.
“Everything in this country needs to be rebuilt,” Schmitz tells DW. He says public hospitals have not received any investment in more than ten years – an area where he sees significant growth potential for his company.
Schmitz knows that without new elections, the country lacks legal certainty and predictability. Still, he feels a sense of optimism: “People are willing to take risks again. We are getting small orders and enquiries.”
Opportunities for German companies in Venezuela?
German entrepreneurs in rural Venezuela are less optimistic.
“Our workers are facing the same difficulties: frequent power cuts, fuel shortages and long lines at gas stations,” he told DW.
Venezuelan engineer Alvaro Ybarr estimates that German companies could do good business in Venezuela, especially in the energy and raw materials sectors.
For example, Siemens has a long history of power grid expansion, he said. Venezuela’s transitional government has recently held talks with Siemens and US conglomerate General Electric with the aim of modernizing the power grid, he says.
Exiled Venezuelans remain absent
For Ybor, who has worked in the energy sector in Venezuela and Colombia for more than three decades, it is especially important that Venezuela develop a long-term strategy for its electricity supply.
“Energy can accelerate reconstruction and economic growth,” he told DW. They estimate that building a sustainable power grid will require an investment of between $30 and $50 billion over the next few years.
Thilo Schmitz believes the most important factors are whether banks will be able to lend again and whether skilled workers will return. For them, shortage of skilled labor remains a major challenge to the economic development of the country.
This article was originally written in German.