Business Magazine

Why Free Enterprise Matters for Democracy in Venezuela

Posted on the 03 July 2014 by Center For International Private Enterprise @CIPEglobal

By Gustavo Guerrero and Laura Boyette

The economic and political climate in Venezuela today has grown to crisis levels as the government consolidates power and limits the freedoms of entrepreneurs and the private sector through harmful legislation and the nationalization of private businesses. In the face of these challenges, the Federation of Chambers and Associations of Commerce and Production (FEDECAMARAS) continues working hard to advocate for policies that will grow the Venezuelan economy and provide more opportunities to young entrepreneurs, both of which are essential to creating a brighter future for Venezuela. In May Jorge Roig, President of FEDECAMARAS, sat down for an interview with CIPE and discussed the role of the private sector and its advocates in Venezuela.

Roig stressed the importance of cooperation between business, society, and government, saying that without engaging these groups in dialogue, substantive change will not occur. In recent years, the Chávez and Maduro governments have depicted the private sector and organizations such as FEDECAMARAS as the source of Venezuela’s economic problems, claiming they have political aspirations. However, Roig defined the role of FEDECAMARAS very clearly – not to be a political power, but rather to influence it on behalf of entrepreneurs. Furthermore, organizations such as FEDECAMARAS not only protect free enterprise, but also support democratic values and act in the best interests of the society as a whole.

Roig sees private enterprise as the way for countries to escape from crisis. Through adversity, he explains, innovation provides the answers. According to a recent World Bank study, in 2012 Venezuela applied for three times as many patents as Peru and Ecuador combined. In uncertain times, radical innovations are proposed and implemented, hastening change. It is the role of FEDECAMARAS to nurture that spark of ideas and let it shine through entrepreneurship.

FEDECAMARAS not only advocates for policies beneficial to the private sector, but also provides training programs for young entrepreneurs. In its new program “Learning to Be an Entrepreneur,” young men and women learn about how to form a business and how to make it succeed. The program’s success is not instant – Roig admits it does not turn participants into entrepreneurs overnight, but rather gets them into the mindset of becoming an entrepreneur first, then assists them in starting their own businesses and preparing for success.

The program teaches the importance of a strong civil society and a free market for democracy. In his words, “Each time a young entrepreneur is able to create a business – open it, have success, and be responsible to their community – that is our best contribution to democracy.”

Roig also touches on the nationalization of private businesses and laws that restrict free enterprise, noting that Venezuela’s best chance at overcoming its current economic crisis is only through entrepreneurial and free-market practices that allow business to grow and Venezuelans to help one another and the future of their country.

The eight-part interview is available on YouTube with English subtitles and in the original Spanish.

Gustavo Guerrero is an intern for Latin America & the Caribbean at CIPE. Laura Boyette is Program Coordinator for Latin America & the Caribbean at CIPE.

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