On March 30, 1845, Spain recognized the independence of Venezuela in the Treaty of Madrid.
A period of successive revolutions followed until finally in 1870 Guzman Blanco assumed control of the country as dictator. Evading the provisions of the constitution which prohibits the election of a President for successive terms, Blanco successfully arranged through two decades for the nomination of some one of his colleagues who was to hold office as a figurehead.
The people finally tired of this procedure and in 1889 there was a revolt against the dictator which resulted in his overthrow. At the elections which followed General Andueza Palacios was elected to the presidency, but another revolution followed in 1891, during which Palacios was unseated and General Crespo, his vanquisher, took up the reins of government.
During the administration of General Crespo trouble arose with Great Britain over the boundary between British Guiana and Venezuela. President Cleveland intervened in 1895, urging arbitration and finally in 1899 the matter was amicably settled. This difference with Great Britain left certain memories with the Venezuelan people which for a long time operated to the discouragement of British capital.
After another series of revolts, General Cipriano Castro became president in 1900. Internal disturbances continued and in addition to this misfortune, Castro ruled as a dictator, employing corrupt and revolutionary methods which not only aggravated the domestic disease but ruined credit before the nations of the world. In 1907 the Belgium debt was repudiated and the following year trouble arose with Holland regarding the harboring of refugees in Curaçao. Diplomatic relations were also broken off with England, Italy and France during Castro's administration. Finally, in 1908 he found it advisable to retire to Europe and in his absence Juan Vicente Gómez, the Vice President, took control and was installed as President in June, 1910. General Gómez still exercises the supreme power in his capacity as Commander-in-Chief of the Army.
PRODUCTS
(See Reports on Agriculture, Minerals, and Animal Industries.)
BANKS AND CURRENCY
There are four national banks in the country—the Bank of Venezuela, the Bank of Caracas, the Bank of Maracaibo and the Commercial Bank. These four banks issue paper currency, which is not legal tender, although generally accepted as such.
Previous to the establishment of branch banks in Venezuela by foreign concerns, the majority of import and export houses doing business in the Republic were engaged in domestic and foreign banking business. As a general rule, these merchants charged such a high rate of interest that individuals could not improve their property nor prosper in their regular agricultural pursuits.