Closely allied to the above topic is the subject of foreign banks. When foreign capital first finds its way into a new country it is inevitably followed by a branch of some large home bank, a fact as true in Venezuela as elsewhere. In Caracas we find The National City Bank of New York, the pioneer American bank in foreign fields, serving not only American firms but many Venezuelans in their business dealings with the United States. The National City Bank made its initial bow to the city of Caracas in 1917. American interests are further represented in Caracas by a branch of the Mercantile Bank of the Americas which has a subscribed and paid up capital of Bs. 2,600,000.
Canadian interests are represented in Venezuela by the Royal Bank of Canada with a paid-up capital of Bs. 88,400,000 and a reserve amounting to a like sum. English interests are served, to a great extent, by The Commercial Bank of Spanish America, Ltd., which is affiliated with the Anglo-South American Bank, Ltd., and has a capital and reserve amounting to Bs. 200,000,000. This is the most recent foreign banking institution to appear.
The Dutch have here a branch bank of the Hollandsche Bank Voor West-Indie, which has a subscribed and paid-up capital amounting to Bs. 2,000,000, and lastly we have the Deschanel International Corporation de Venezuela of French origin which has a capital and reserve of Bs. 1,260,000. Besides doing a banking business, this corporation is itself interested in the importing and exporting business. From the above facts we may see that the investor will not lack any of the banking facilities so essential in a foreign field.
PUBLIC UTILITIES
Under the caption of "Public Utilities" may be considered street railways, telephones, telegraph, gas and electric light and power companies. The English seem to have a monopoly on most of the public utilities in Venezuela, but whether or not this is an advantage either for the English or Venezuelans is matter for speculation. One of the leading American governmental officials in Venezuela on being interviewed by the writer said: "Nearly all the public utilities are in the hands of the English and I am glad they are being operated by English and not American companies, for the service is poor and the people are discontented." From the writer's observation, this is indeed true in the city of Caracas, for the street railway company (English) uses very ancient cars, each capable of holding only twenty-four people, and there are turn-outs about every two hundred yards which give the passengers opportunity to reflect on the service while waiting for the other car to come along. Data as to the investment and earnings are lacking but as a general conclusion it may be stated that there is much room for improvement in all these fields. For example, the only cable in Venezuela is in the hands of a French company and in order to send a message to the United States it is necessary first to relay it to Haiti and thence to the United States which occasions unnecessary delay and considerable expense in commercial transactions. (See special report on Radio Communication.)
OTHER INVESTMENTS
In Venezuela it is the ordinary thing to find American goods on sale in most of the stores and agents for different classes of American goods throughout the country. These agencies are mainly in the hands of established Venezuelan firms but in Caracas there are fewer Americans acting as agents for many of the best known American products. Here too is the Caribbean Petroleum Company with important oil and asphalt concessions along the shores of Lake Maracaibo. For the year 1919 the output of the company was 45,913,840 metric tons of oil on which the government receives a tax of two bolivares a ton. English capital has of late been used increasingly in buying land in the interior "llanos," for the development of the cattle industry. At the present writing American capital is being diverted to the same purpose, as, with the development of transportation facilities, live stock promises to be of utmost importance because of an increasing world population and a greater demand for food.
Part II
Investment Opportunities in Venezuela
Before entering upon a discussion of the future opportunities for investment in Venezuela, two outstanding features need to be emphasized as factors influencing the investing of money in Venezuela. They are: 1st, A realization of the fact that Venezuela needs immigration and needs it badly to develop her rich natural resources, as her population has been almost at a standstill for the last ten years. The other crying need is foreign, not native, capital.
Venezuela, a country larger than Germany, at present maintains a population estimated at 2,800,000. The greater proportion of the population is found in six or eight large cities in the north. Around the Orinoco and south of it lie thousands of acres of rich virgin soil and, strange to say, mines of coal, iron, copper, and gold which are not worked due to lack of transportation facilities.