Venezuelan trade with countries of the Persian Gulf has not taken off

Venezuela's President Nicolás Maduro in a meeting in Qatar with Emir Tamin bib Hamad Al Thani (File photo)
Venezuela’s President Nicolás Maduro in a meeting in Qatar with Emir Tamin bib Hamad Al Thani (File photo)

TODAY VENEZUELA – In its foreign opening, the nations of the Persian Gulf and Member States of the Organization of Petroleum Exporting Countries (OPEC) approached Venezuela as a natural ally because of their energy relationship. Thus far, however, the agenda has remained in a letter of intent and the signing of agreements where trade of goods is plummeting and the balance of trade continues favoring those nations.

Most members of the Gulf Cooperation Council (GCC) set up diplomatic relations with Venezuela in the seventies. In the last six years, Caracas has boasted a “unique partnership” with Saudi Arabia, UAE, Kuwait, Iraq, Qatar and Iran, as OPEC Member States in lobbying for oil fair prices and against “imperialism.”

As a matter of fact, trade with these oil producing countries has been diving since 2008. While Venezuelan imports are 82% over exports, Venezuela has failed to attract the jewel of the crown of some of those petro-monarchies: their billionaire investment sovereign funds, which have been cashed in on by Ecuador and Brazil by means of key projects.

By 2008, Venezuela imported from the six Persian Gulf countries non-oil products for USD 90.7 million. In 2009, the total amount was USD 112 million. However, these numbers declined to USD 41.9 million in 2014, with Iran leading the roster.

Chemical products, common metals and transportation means (Iran sold 90%) are the principal goods bought by Venezuela all these years, based on data from the National Statistics Institute (INE).

While in 2008, USD 18.8 million in chemicals, plastics, textiles and related manufactures were exported to the Persian Gulf, such number plunged to USD 11.5 million in 2010, and USD 1.02 million in 2012. Nevertheless, 2014 ended in the black with USD 21.4 million in raw materials. In any case, the domestic private sector lagged behind the Venezuelan State.

During a visit in January to Qatar, Saudi Arabia and Iran, President Nicolás Maduro reported on “a partnership to boost a special project for agricultural productive development” in Qatar; the establishment of a “high-level joint committee” in Saudi Arabia, and the steps to “advance established agreements” with Iran.

Although Venezuela longs for foreign investments, the authorities of Persian Gulf countries have reiterated their intention to invest in a context of legal security.

Thus far, Arab major businesspersons are yet to arrive. As regards the partnership with those nations, no significant economic results have materialized.