Why Venezuela’s Economic Recovery May Depend on Financing Businesses Beyond Oil

Venezuela's economic prospects raise a question that extends beyond its oil reserves. How might renewed investment reach businesses across the country? The International Monetary Fund projects 4% economic growth for 2026 alongside consumer price inflation of 387.4%. Those forecasts suggest that expansion and financial instability could coexist, complicating the decisions facing entrepreneurs and investors.

International negotiations offer one indication of where attention is concentrated. In September, Reuters covered discussions involving Venezuela's energy industry, mining, and debt restructuring. These negotiations concern substantial financing needs, while leaving a broader question about how businesses outside resource extraction might participate in recovery.

Experience elsewhere provides useful context. In its 2024 assessment of Poland, the World Bank linked the country's economic progress to regional integration, investment in people, and productivity growth supported by a dynamic private sector. Despite its setbacks, Poland now stands alongside its counterparts in Luxembourg as one of Europe's fastest-growing economies. That history offers reasons to consider how enterprise develops alongside wider economic reform.

The comparison also has limits. Poland's experience involved several mutually supporting changes, making it an imperfect guide to another country's future. Read alongside Venezuela's inflation outlook, it suggests that attracting investment and creating conditions in which businesses can use it productively are connected challenges. Neither follows automatically from the other.

For Hervé van Caloen, portfolio manager and chief investment officer at Mercator Investment Management, access to capital deserves greater attention within that broader picture. He sees potential for Venezuela's stock market to help finance enterprises beyond oil, gas, and mining. "There is considerable potential, but businesses need capital to develop it," he explains.

His perspective draws on an international investment career that, he notes, has largely involved mature markets in Europe and Japan, with earlier experience involving Korea and Eastern Europe. He recalls investing in Poland in the early 1990s, when its economic transition prompted him to examine opportunities emerging alongside greater scope for private enterprise.

Van Caloen sees parallels in Venezuela's entrepreneurial potential, while identifying existing infrastructure and expertise among Venezuelans abroad as possible foundations for rebuilding. He acknowledges that infrastructure requires investment. In his view, members of the diaspora could contribute knowledge, business relationships, and financing, whether they return or remain overseas.

"A more diversified economy would give businesses beyond the resource industries greater room to grow," he observes. His argument centers on widening participation in economic activity. He believes tourism and other service businesses could offer additional routes for investment to support employment and local enterprise.

Tax treatment forms another part of his reasoning, although the distinction requires care. Lloyds Bank's trade portal identifies a 1% tax on gross proceeds from qualifying stock exchange share sales. PwC explains that capital gains generally fall under ordinary income taxation, with standard corporate rates reaching 34%. These percentages apply to different tax bases, so they are not interchangeable measures of the same liability. Therefore, capital that moves directly through the stock exchange benefits from up to a 33% tax saving.

Van Caloen considers the exchange one possible financing route for companies ready to expand. "Once entrepreneurs become more successful and need additional capital, the stock market could help them take that next step," he explains. His longer-term interest concerns new share offerings through which businesses could raise money for their operations.

Tourism illustrates the wider effect he hopes such financing could support. He envisages investment helping tourism businesses develop, with visitor spending potentially reaching other local enterprises. Within that scenario, he sees opportunities for hiring and commercial relationships that extend beyond the company receiving the initial investment.

Market capacity remains a consideration in his own plans. Van Caloen notes limited liquidity and states that he is launching a fund for accredited investors. "The longer-term goal is to help entrepreneurs raise capital as their businesses develop," he adds.

For van Caloen, the significance of a stronger stock market would ultimately lie in the businesses it could help finance. His vision of recovery includes entrepreneurs gaining the means to expand, employ people, and serve their communities. The meaningful test, in that view, is whether investment creates opportunities that extend into everyday economic life.