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Venezuela

Venezuela

Bilateral relations between the EU and Venezuela are not governed by any bilateral legal framework, unlike other Mercosur countries. EU relations with Venezuela were initially going to be governed by the Political Dialogue and Cooperation Agreement between the EU and the Andean Community signed in 2003, but this is no longer the case since the withdrawal of Venezuela from the Andean Community in 2006. The EU and the Mercosur region that includes Venezuela are negotiating a trade agreement as part of the overall negotiation for a bi-regional Association Agreement which also covers a political and a cooperation pillar, but Venezuela does not currently integrate the negotiations.

Venezuela has been an observer in the on-going negotiations of an EU-Mercosur Association Agreement since 2010 as candidate country to Mercosur. Despite its accession in July 2012, Venezuela has decided to remain an observer in these negotiations for the time being.

The business climate in Venezuela remains challenging for EU operators due to the Venezuelan government's economic policy.

Trade picture

  • The EU is Venezuela's third trading partner, after the US and China. Total EU-Venezuela trade accounted for €10.7 billion in 2012.
  • EU's exports to Venezuela have steadily increased over the last years, going up from €4.3 billion in 2008 to € 6.5 billion in 2012. Exports however decreased to €4.5 billion in 2013 due to the country’s economic situation.
  • The EU has been registering growing trade surpluses with Venezuela since 2010. In 2013, the trade surplus was reduced to €1,2 billion, due to the decrease in imports as compared to 2012.
  • Venezuela's biggest exports to the EU are made of fuels and mining products (84% of total exports in 2012) while the EU mostly exports manufactured products to Venezuela, notably machinery and transport equipment (35% of total exports in 2013) and chemicals (28% of total exports in 2012).
  • The EU is also a major exporter of commercial services to Venezuela (€3 billion in 2012) as well as a major foreign investor in the country with a stock of foreign direct investment that has steadily increased over the past years and which amounted to €24.7 billion in 2012 compared to €5.5 billion in 2004.

EU-Venezuela "trade in goods" statistics

Trade in goods 2011-2013, € billions
Year EU imports EU exports Balance
2011 4.2 4.9 0.7
2012 4.5 6.5 2.0
2013 3.4 4.5 1.2

EU-Venezuela "trade in services" statistics

Trade in services 2010-2012, € billions
Year EU imports EU exports Balance
2010 0.6 3.1 2.4
2011 0.7 3.1 2.4
2012 0.9 3.0 2.1

Foreign direct investment

Foreign direct investment 2012, € billions
Year Inward stocks Outward stocks Balance
2012 7.9 26.7 18.8

More statistics on Venezuela

EU and Venezuela

Although there is currently no legal framework for bilateral relations between the EU and Venezuela, economic dialogues between the parties have been taking place since 2008. The last economic dialogue was held in 2012. There have been efforts to continue engaging Venezuelan authorities in ongoing economic dialogue during 2013, but a common agenda is still to be defined.

From 1 January 2014, Venezuela does no longer benefit of preferential access to the EU market through the EU’s Generalised Scheme of Preferences (GSP) since the country is classified as an upper middle income country. Nonetheless, Venezuela remains eligible for the GSP.

The investment climate in Venezuela remains challenging for EU operators, in large part due to policies which have been central to the economic strategy of the government in the past few years: foreign exchange controls, price controls, expropriation and other forms of State intervention in the economy.

Venezuela in Mercosur

On 31 July 2012, Venezuela became a full member of Mercosur and on 12 July 2013 took up the pro tempore presidency of the bloc.

More information on Mercosur

Trading with Venezuela