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[Illustration: VENEZUELAN AND GEORGETOWN STUDENTS FRATERNIZING AT THE
FOOT OF STATUE OF SIMÓN BOLÍVAR

                                                          _Frontispiece_]





                               SERIES II

                            BULLETIN NO. 1

                         Georgetown University

                               SCHOOL OF
                            FOREIGN SERVICE

                            [Illustration]

                               VENEZUELA

               AN ECONOMIC REPORT PRESENTED BY STUDENTS
                   OF THE SCHOOL OF FOREIGN SERVICE
                    AS AN AID TO THE FOREIGN TRADE
                         OF THE UNITED STATES


                      PUBLISHED BY THE UNIVERSITY
                           WASHINGTON, D. C.
                              APRIL, 1921

                              THIS REPORT

      THE FIRST OF A SERIES OF ECONOMIC SURVEYS OF THE COMMERCIAL
             AREAS OF THE WORLD TO BE CONDUCTED AS AIDS TO
                      AMERICAN OVERSEAS COMMERCE
                                  BY
               STUDENTS OF THE SCHOOL OF FOREIGN SERVICE

                            ~Is Dedicated~

                                  TO

                   ~Señor Doctor Esteban Gíl Borges~

                   MINISTER OF FOREIGN RELATIONS OF
                               VENEZUELA

                 UPON WHOM AS REPRESENTING THE PEOPLE
                                  OF
                          THE LAND OF BOLÍVAR
                   GEORGETOWN UNIVERSITY WILL CONFER
                          WITH FELICITATIONS
                        THE HONORARY DEGREE OF

                           ~Doctor of Laws~

                         ON APRIL TWENTY-SIXTH
                    NINETEEN HUNDRED AND TWENTY-ONE

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                   by the Internet Archive in 2007.
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TABLE OF CONTENTS


  PART I

  PAGE

  LETTER OF SUBMITTAL OF REGENT OF SCHOOL OF FOREIGN SERVICE TO
        PRESIDENT OF THE UNIVERSITY                                   11

  REPORT OF DR. SHERWELL, HEAD OF GEORGETOWN MISSION TO VENEZUELA     13
    Personnel of Group                                                13
    Program of Studies                                                14
    Departure from New York                                           14
    Reception by University of Caracas                                14
    Message of Georgetown University                                  15
    Reply of University of Caracas                                    19
    Reception at Military Academy                                     21
    Tour of Northern Venezuela                                        23
    Recitation and Research Work                                      26
    Final Lecture                                                     26
    Departure for the United States                                   28
    Acknowledgment of Courtesies                                      29

  PART II

  STUDENT REPORTS

  ECONOMIC HISTORY OF VENEZUELA                                       31
    Geographical                                                      31
    Political                                                         32
    Banks and Currency                                                33
    Aids to Economic Development                                      34
    Government                                                        35
    Prospective                                                       36

  POPULATION, IMMIGRATION, EDUCATION                                  37
    Census Reports                                                    37
    Most Thickly Populated Districts                                  38
    Need of Immigrants                                                39
    Inducements to Immigrants                                         40
    Educational Facilities                                            41

  PORTS OF VENEZUELA                                                  46
    Coast Line                                                        46
    Major Ports                                                       47
    Minor Ports                                                       48
    Special Port Activities                                           49
    Port of La Guaira                                                 50
    Pilotage and Towage                                               52
    Lighterage and Cartage                                            52
    Stevedoring                                                       52
    Port Charges                                                      53
    Wharves and Warehouses                                            53
    Documents                                                         54

  OCEAN, CABLE AND RADIO COMMUNICATIONS                               55
     Shipping Communication                                           55
     Number of Ships Entering each Port                               57
     Nationalities of Ships Entering same Ports                       58
     Steamship Lines                                                  60
     Red "D" Line                                                     62
     Cable Communication                                              63
     Wireless Communication                                           64

  TRANSPORTATION FACILITIES                                           65
     New National Highways                                            66
     Equipment and Care of Highways                                   67
     Automobiles in Venezuela                                         67
     Venezuelan Railroads                                             68
     Waterways of Venezuela                                           71

  AGRICULTURE IN VENEZUELA                                            73
     Agricultural Zone                                                73
     Products                                                         73
     Coffee                                                           74
     Cacao                                                            74
     Tobacco                                                          75
     India Rubber                                                     77
     Sugar Cane                                                       78
     Wheat                                                            80
     Cotton                                                           80
     Tonka Beans                                                      81
     Vanilla                                                          82
     Cocoanuts                                                        82
     Indian Corn                                                      83
     Beans                                                            83
     Indigo                                                           83
     Capital Invested in Agriculture                                  84
     Forest Zone                                                      85

  CATTLE INDUSTRY OF VENEZUELA                                        87
     Number of Cattle                                                 88
     Other Live Stock                                                 88
     Exports of Pastoral Zone                                         89
     Facilities for Cattle Raising                                    90
     Obstacles to Cattle Raising                                      92
     Recent Developments                                              93
     Centers of Animal Industry                                       93
     Dairy and Canning Plants                                         93
     Price of Land                                                    95
     Desirable Regions                                                95
     British Investments                                              96

  MINERAL RESOURCES OF VENEZUELA                                      97
     Land Surface of Venezuela                                        97
     Rocks                                                            97
     Gold                                                             98
    Copper                                                            99
    Iron                                                              99
    Coal                                                             100
    Salt                                                             100
    Summary of Ores Mined in Recent Years                            102

  PETROLEUM AND ASPHALT IN VENEZUELA                                 102
    History of Petroleum                                             103
    Mining Law of 1905                                               103
    New Code of 1909                                                 104
    First Development of Petroleum Fields                            104
    Mining Law of 1918                                               104
    Contracts Awarded                                                105
    Opportunities for Development of Petroleum Industry              107
    Petroleum Exported                                               108
    Description of Asphalt                                           108
    Occurrence of Asphalt                                            109
    Asphalt Industry                                                 110

  CHECKS, DRAFTS, BILLS OF EXCHANGE AND TRADE ACCEPTANCES IN
        VENEZUELA                                                    110
    Function of Credit                                               110
    Extent of Check System in Venezuela                              111
    Clearing of Checks                                               112
    Laws regarding Commercial Paper                                  112
    Drafts and Bills of Exchange                                     113
    Long and Short Time Credit                                       113
    Foreign Drafts                                                   114
    Definition of Trade Acceptance                                   115
    Extension of Usage of Trade Acceptances                          116

  COMMERCIAL TRAVELERS IN VENEZUELA                                  117
    Importance                                                       117
    Climatic Conditions in Venezuela                                 117
    Customs Duties on Samples                                        118
    Catalogues                                                       118
    Knowledge of Language and Customs of Venezuela                   119
    Climate of Various Cities                                        120
    Market for Various Products                                      120
    Complaints Against American Methods of Packing                   120
    Roads and Highways in Venezuela                                  121
    Tables of Distances Between Principal Cities                     121
    Freight Charges                                                  126
    Financial Conditions                                             126
    Currency                                                         127
    Venezuela's Tariff                                               127
    Opportunity for American Travelers                               128

  FOREIGN INVESTMENTS AND AMERICAN CAPITAL IN VENEZUELA              129
    Venezuela's Public Debt                                          129
    Foreign Banks                                                    130
    Public Utilities                                                 131
     Other Investments                                               131
     Investment Opportunities                                        132
     Proposed Railroads                                              133

  FOREIGN TRADE AND AMERICAN GOODS                                   137
     Foreign Trade in Venezuela                                      137
     Effects of the World War                                        138
     Imports and Exports                                             139
     Summary of Venezuelan Foreign Trade--1917-1919                  140
     Market for American Goods                                       141
     Complaints Regarding Packing                                    141
     American Selling Methods                                        142
     German Competition                                              142
     Customs Collections                                             143
     American Personnel in Venezuela                                 144

  APPENDIX

  CLOSING LECTURE IN SCHOOL OF POLITICAL SCIENCE BY DR. PEDRO ITRIAGO
        CHACÍN                                                       145

  EDITORIAL COMMENT BY AMERICAN AND VENEZUELAN JOURNALS              156
     Good Trade Ambassadors, _N. Y. Post Express, August 11, 1920_   156
     Student Fraternization, _El Nuevo Diario, Caracas,
        June 20, 1920_                                               156
     Llegada de los Estudiantes Americanos, _El Nuevo Diario,
        June 27, 1920_                                               158
     El Profesor Sherwell, _El Universal, June 27, 1920_             159
     Dr. Sherwell Arrives, etc., _La Prensa, New York,
        August 26, 1920_                                             161
     Georgetown Students Welcomed in Venezuela, _Sunday Star,
        Washington, July, 1920_                                      163
     El Match de Base-ball, _El Imparcial, July 18, 1920_            164

ILLUSTRATIONS

  At the foot of Bolívar's Statue                         _Frontispiece_
                                                             FACING PAGE
  Salutation--Georgetown to University of Caracas                     16
  Reply of University of Caracas to Georgetown                        20
  Map of Venezuela                                                    24
  Dr. Sherwell and Georgetown Students                                31
  Rancho Grande and Ocumare de la Costa                               49
  Bolívar's Home in the Mountains. On the Road from Maracay to
        Caracas                                                       65
  At Central Tacarigua. At foot of Statue of Ribas                    97
  Ceremonies in honor of Bolívar and Washington                      133
  Trophy presented to Georgetown Students by Minister of Public
        Instruction                                                  165


    REPORT OF THE REGENT OF THE SCHOOL OF FOREIGN SERVICE TO THE
      PRESIDENT OF GEORGETOWN UNIVERSITY, WITH RESPECT TO THE VISIT
      OF CERTAIN STUDENTS OF THE UNIVERSITY TO VENEZUELA.

       *       *       *       *       *

  OFFICE OF THE REGENT

                       SCHOOL OF FOREIGN SERVICE
                         GEORGETOWN UNIVERSITY
                           WASHINGTON, D. C.

                                                          March 1, 1921.

  _To the President of Georgetown University._

  _Sir:_

I hand you herewith papers relating to the visit to Venezuela made by a
group of eighteen students in the summer of 1920. These papers comprise
a brief report of the trip, by Dr. G. A. Sherwell, who was in charge of
the mission, some of the essays on the economic resources of Venezuela,
prepared by the students, and, in the appendix, a translation of a
notable address delivered by Dr. Itriago Chacín at the close of the
Georgetown students' sojourn in Caracas, together with editorial
comments from certain journals of this country and Venezuela. I venture
to refer briefly to each of these documents.

Dr. Sherwell's report makes clear how great was the courtesy shown and
how extensive were the facilities afforded to the Georgetown students
by the official and academic authorities of Venezuela. I believe the
University, and for that matter academic circles outside our own
University in this country, must be grateful for the many attentions
and unfailing interest manifested by the Venezuelan officials and
teachers in the work of these students.

Dr. Sherwell's report likewise makes clear that the contact was a
valuable one for the particular students who made the trip, and that
they bore themselves well and creditably. All the more satisfaction may
be derived from this fact inasmuch as the students selected might be
fairly taken as a cross section of the student body in the School of
Foreign Service,--and you are already aware how widely representative
of the youth of our country that student body is. That these young
men should have made a favorable impression in a rather long trip of
this character when they were under the observation of a great number
of persons, and often in situations calling for a demonstration of
no inconsiderable poise and sense of the fitness of things, can not
but enhance our satisfaction and our confidence not merely in the
resourcefulness but in the trustworthiness of the men upon whom this
country must depend in the future for the promotion of her trade and
the dignified and active representation of her policies.

The address of Dr. Itriago Chacín has been reproduced in full,--in
so far as a translation can ever render the full effect of an
original,--and it is, quite apart from its intrinsic merit, a document
of much interest, for it shows how profitable and enlightening must be
the studies in the field of political science carried on by students
sent out in groups under conditions described in this report. Studies
in the field of Political Science are not, to be sure, the primary
object of students going abroad to survey the economic resources,
the commercial usages, and the facilities for transportation and
distribution of commodities in the countries which they visit. None the
less, sustained contact with trained masters of political studies may
at times be possible, and should in all cases be availed of in order to
gain the valuable experience of hearing points of view on matters of
international policy developed in other countries and under conditions
quite different from those obtaining at home.

Space forbids that more than thirteen of the reports prepared by
the students be published. Those selected are believed to have the
more general interest and to contain material not easily found in
other sources. All of them were based upon personal investigation
and consultation with Venezuelan authorities. Obviously, there are
evidences of hasty preparation and the papers leave something to be
desired in the arrangement and presentation of material, the collation
of figures, and the critical discussion of printed sources. In places,
too, there are statements which might require modification if a more
mature person were to assume responsibility for the given report. They
are submitted solely as the work of students in process of formation.

It is of interest to call attention to the fact that this visit to
Venezuela was the source of much favorable comment in the press of
the two countries, several papers in the United States dwelling upon
its significance as the first formal effort to place our own students
directly in contact with the life of the other Republics. Specimens are
included in the Appendix.

Dr. Sherwell has referred to the bestowal of a decoration on him by the
Venezuelan Government, and has minimized its personal significance.
This reservation of his I transmit with amendments, for I can not but
share the views of the Venezuelan authorities in granting him first,
the Medal of Public Instruction and later the Order of the Liberator,
that he had rendered Venezuela a lasting service, no less than his
own country, by his dignified, gracious, and enthusiastic interest in
the promotion of the intellectual and commercial relations of the two
republics.

The immense practical value of laboratory work in the physical sciences
is among the cardinal tenets of sound pedagogy. In like manner, the
application of economic principles and theories of political science
to actual conditions as they exist in the world to-day is the ideal
feature of a liberal education for foreign service such as this
department undertakes to provide. Perhaps in no other educational
program should more pains be taken to cultivate the faculty of accurate
observation, exact expression and bold initiative, based on logical
reasoning aided by fertile imagination.

Proficiency in the technique of foreign trade or consular practice or
diplomatic procedure is but a fractional part of the full equipment
of American youths aspiring to serve their country's interests
abroad either in public or private capacity. Technical knowledge
will be futile unless humanized by a broad sympathy with the men and
institutions of other climes. Therefore, the policy of sending such
groups of students abroad deserves encouragement, and I earnestly
recommend that the Regent of the School of Foreign Service be
authorized, on the basis of the substantial success of this first
experimental visit, to send such students as it is possible to select
and send under competent direction, to other countries in the summer of
the present year and hereafter.

                      Respectfully, EDMUND A. WALSH, S. J.,
                                                            _Regent_.

  To
  JOHN B. CREEDEN, S. J., PH. D.,
  _President of Georgetown University_,
  _Washington, D. C._




PART I

REPORT OF DR. GUILLERMO A. SHERWELL

_Professor of Spanish_

TO THE REGENT OF THE SCHOOL OF FOREIGN SERVICE


_Sir:_

In order to afford the students of the School of Foreign Service an
opportunity to practise Spanish and to study at first hand economic
conditions in one of the South American countries, it was decided in
May, 1920, to send a group of not more than twenty to Venezuela under
the direction of the Professor of Spanish. The Knights of Columbus
agreed to pay for the expenses of twelve of the students, who were
holders of scholarships awarded by that organization to ex-service
men, and six other candidates offered to pay their own expenses.
Consequently, a group of eighteen was selected in accordance with the
following conditions laid down by the University authorities: (1)
That the student's mark in Spanish had not been less than 70% and (2)
That he had not failed in any other subject of the Foreign Service
curriculum. The students chosen were:

  PAUL BABBITT, Arizona
  J. HOMER BUTLER, Massachusetts
  FRANK CHIRIELEISON, District of Columbia
  JAMES F. COSTELLO, Wisconsin
  WALTER J. DONNELLY, Connecticut
  EDWARD FANNING, New York
  WILLARD C. FRAZEE, Ohio
  MATTHEW HEILER, Massachusetts
  NELSON HOPKINS, New Jersey
  WILLIAM JOHNSON, District of Columbia
  GEORGE E. MCKENNA, Massachusetts
  THOMAS MORRIS, New York
  EDWARD L. MURPHY, Pennsylvania
  JAMES J. O'NEIL, Massachusetts
  JOSEPH P. QUINLAN, Massachusetts
  DAVID SCHLESINGER, Iowa
  PHILIP D. SULLIVAN, Massachusetts
  GEORGE A. TOWNSEND, Maryland

It was provided that the students should have, each day, an academic
hour of formal Spanish instruction while in South America, that they
should be distributed among private families where they might have
frequent opportunity to practise Spanish and that they should devote
a second academic hour each day to recitation and discussion of the
economic and financial conditions of Venezuela. Individual research
work on economic topics was likewise required. The results of each
student's investigations were to be discussed in class so that each
student might profit by his fellow-students' labors, each man having
one topic on which to report. This program was carried out as it had
been planned. The topics, distributed by lot during the sea voyage,
were as follows:

  Economic history of Venezuela.
  Agricultural and forestal resources of Venezuela.
  Cattle industry in Venezuela.
  Coffee industry in Venezuela.
  Sugar industry in Venezuela.
  Mineral oil industry in Venezuela.
  Mineral resources of Venezuela.
  Ports of Venezuela.
  Commercial travelers in Venezuela.
  Venezuela as a field for the investment of foreign capital. Present
    foreign investments.
  Banking and currency in Venezuela. History and present status.
  Venezuelan foreign trade. American goods in Venezuela.
  Bills of exchange, checks, and trade acceptances in Venezuela.
  Steamer and cable communications with Venezuela.
  Taxation and budget in Venezuela.
  Venezuelan public debt.
  Population, immigration, and public education in Venezuela.

On June 16, 1920, the group sailed from New York on the Red "D" Line
Steamship _Caracas_. Several representatives of the press came on board
together with friends and alumni of Georgetown to bid Godspeed to the
first missionaries of friendship sent by an American university to
South America.

On June 26th the group arrived at La Guaira, the port nearest the
capital of the country, and was received by personal representatives
of the Secretaries of Foreign Relations, of the Treasury and of Public
Instruction, as well as by a very distinguished group of students
of the different schools of Caracas, headed by their President, Mr.
Atilano Carnevali. After lunching at a beach called Macuto, the group
was taken in automobiles to Caracas and escorted to their lodgings
where two students were placed in each house.

On Monday, June 28th, the message, in Latin, from the University of
Georgetown, engraved on parchment and addressed to the Universidad
Central de Caracas, was delivered to the Venezuelan authorities in the
beautiful auditorium of that University.

The President of the Council, a body which exercises supervision of
the University studies and is the supreme examining tribunal for the
conferring of diplomas, announced in brief words the object of the
meeting and invited us in the following words, to present the message
of the University of Georgetown:

    "Gentlemen of the National Council of Instruction and Members
    of the National Commissions; President and Members of the
    Schools of Physical, Medical, Mathematical and Political
    Sciences of the City of Caracas; Representatives of the
    Academies and other Institutions of University Extension;
    Students, Ladies and Gentlemen:

    "We have assembled to receive the visit of illustrious guests
    who bring a noble and generous message from the University
    of Georgetown; they come at a time propitious for American
    patriotism and they are going to spend here the month in which
    we celebrate the date of the independence of our countries. It
    will be a pleasure for the Venezuelans to do as much as lies
    in their power to the end that such distinguished guests carry
    back to their country the most agreeable impressions. You are
    about to hear the message from the University of Georgetown.
    Prof. Sherwell will now address you."

The message follows.

                                 _The
                    President and Faculties of the
                       University of Georgetown
                                  to
                    The President and Faculties of
                                  the
                    Central University of Caracas,_

                             _Greetings:_

    "_We avail ourselves of a mission made with an educational
    object by one of our professors and a group of our students to
    send to you and to the students of your University fraternal
    expressions of affection and comradeship from the University of
    Georgetown._

    "_The University of Georgetown has developed at the same time
    that this nation has advanced into its proper life. She has
    witnessed its struggles for liberty, its efforts to acquire
    constitutional life, the bloody conflict which was necessary
    to preserve the union and the last tremendous war into which
    it entered in order to preserve inviolate the sacred heritage
    of liberty which our ancestors have handed down to us._

    _"To each one of these conflicts the University of Georgetown
    has given liberally of its blood, and she preserves sacred the
    names of those who carried the banner of the Blue and Gray
    whithersoever the banner of the Stars and Stripes led them._

    _"Identified with the country of Washington since the days of
    Washington, this University believes itself worthy to regard
    itself as a sister of the University of the country of Bolívar,
    and in extending its hand to clasp the hand of its sister, the
    University of Georgetown presents to the University of Caracas
    her sincere wishes that the friendship of the two institutions
    may endure and be as profound as was the friendship of the two
    liberators for the whole American continent, and as sincere as
    is the friendship which exists between the United States of
    North America and the United States of Venezuela. Assuredly
    there is no stronger bond among men than the pure love of
    liberty and truth. In this common devotion, racial differences
    are forgotten and party strife ceases. When Truth and Liberty
    speak, all else is silent._

                              _Farewell._

                    JOHN B. CREEDEN, S. J., PH. D.,
                      _Rector of the University_.

                WILLIAM COLEMAN NEVILS, S. J., PH. D.,
                 _Dean, Faculty of Arts and Sciences_.

                   THOMAS I. GASSON, S. J., PH. D.,
                       _Dean, Graduate School_.

                      BRUCE L. TAYLOR, D. D. S.,
                     _Dean, Faculty of Dentistry_.

                  GEORGE MARTIN KOBER, M. D., LL. D.,
                     _Dean, Faculty of Medicine_.

                      GEORGE E. HAMILTON, LL. D.,
                        _Dean, Faculty of Law_.

                    EDMUND A. WALSH, S. J., PH. D.,
                 _Regent, School of Foreign Service_.

    [Illustration]

    Given at Washington, on the Ides of June, in the year of our
    Salvation One Thousand Nine Hundred and Twenty."

[Illustration: SALUTATION--GEORGETOWN TO UNIVERSITY OF CARACAS]

After delivering in Spanish the formal message from the University of
Georgetown to the Universidad Central de Caracas your representative
added the following words:

    "The students of the School of Foreign Service of Georgetown
    University are very sensible of the honor conferred upon
    them by this reception in the Assembly Hall of the Central
    University of Caracas, and especially appreciative of the
    courtesy shown by this distinguished assembly of selected
    social and educational elements of this capital.

    "The students of the School of Foreign Service have been sent
    to this wonderful country of yours to practise the beautiful
    Spanish language, to study the economic and financial life of
    Venezuela, and to live among you your own life and observe your
    own customs. They come to you with minds set to their work and
    with hearts open to all impressions which may come from the
    outside world. Most of them have passed through the harrowing
    experiences of the World War. They crossed the seas to the
    European battle fields to defend the cause of liberty for which
    America stands, and now, upon returning to the activities of
    civil life, they are preparing themselves for a better service
    to their country by improving their minds, with the ultimate
    purpose of promoting the foreign trade of the United States.
    They have much to learn, and you have much to teach them.
    They are in your hands, and I am sure that the University of
    Georgetown could never hope to provide better instructors for
    students of Latin American affairs.

    "We have journied hither with only the general knowledge of
    this country acquired in our schools, but since our arrival at
    La Guaira, we have passed through experiences which have left
    our spirits fatigued, if this expression may be permitted,
    with the constant spectacle of grandeur and majesty never
    dreamed of before. As we climbed your lofty mountains, which
    form a great barrier between the heart of your country and
    the outside world, we were continually passing from one deep
    impression to another, and at the same time were arriving at
    a clearer understanding of the character of your people. We
    saw the humble laborers of the field stand erect as we passed
    and show that noble type of manhood which has been observable
    in all the men we have met in this country. And when we gazed
    upon the mountains and the huge abysses which abound in this
    part of the American continent, we ceased to wonder at the
    marvelous deeds of your famous warriors in your struggle for
    independence. Backed by men accustomed to fight and conquer a
    land of mountains and valleys like your mountains and valleys,
    a chieftain might well dare to range over a continent fighting
    for the freedom of his own country and offering freedom to
    neighboring peoples. Bolívar and the Venezuelans seem in some
    respects identical with this territory. Their characters
    suggest mountains.

    "We shall learn more and more of you during our stay, and I
    hope you will know us well enough to consider us your sincere
    and permanent friends.

    "To the young men who study in this University I must say a
    few words, yielding to the old tendency of men accustomed to
    speak from the chair or the platform of the classroom. It would
    seem that every teacher should have a message to deliver to
    the youth of his country, or to those of any other country
    of the world. My message to you is this: We must use every
    endeavor in scientific research to extract from nature all that
    nature has for the benefit of mankind, in order to destroy
    such evil forces as still molest human beings, to improve our
    standards of life, to advance upwards to higher levels in
    thinking and in acting. To accomplish this, we need clear,
    practical and investigating minds. But beware of the fallacies
    entertained by those who contend that the mind of man can
    encompass and explain all truths, and that whatever can not be
    fully explained by the mind or demonstrated according to the
    limited means that science may offer is not truth. There are
    some things above human reason, and to understand them and to
    explain them we must invoke more than our minds. We must bring
    to them the best of our hearts. Those great truths that are
    beyond actual scientific demonstration are not lesser truths,
    but greater truths. It is not permissible to live indifferent
    to good and bad as some so-called philosophers pretend, but it
    is permissible, and it is our solemn duty in many instances, to
    look beyond science, because there are summits which science
    does not reach, and to attain which we must fly with the wings
    of our hearts. The supreme spiritual conceptions of God, of
    Home, of Country do not fall within the range of the physical
    sciences, but are, nevertheless, the great, fundamental truths
    upon which everything noble and everything lofty must rest.

    "We thank you, ladies and gentlemen, for opening your doors to
    us in such a frank and cordial manner, and we hope to prove
    during our stay in this country that we are not unworthy of
    such friendship."

The Minister of Public Instruction, Dr. González Rincones, then
read the reply of the University of Caracas and later forwarded the
engrossed manuscript to Washington:

             _The President of the Council of Instruction
                                and the
                Faculties of the University of Caracas
                                to the
                        President and Faculties
                                of the
                       University of Georgetown,
                          Washington, D. C._,

                             _Greetings:_

    _"We appreciate profoundly your message of friendship, and we
    see with pleasure under the roof of the University of Caracas
    your distinguished professor and this chosen group of your
    students._

    _"The fraternal expressions of affection and comradeship which
    the President and Faculties of the University of Georgetown
    send us have entered into the hearts of our professors and
    students, and have found there a most cordial welcome. Your
    travelers will be able to tell you how great has been the
    enthusiasm which your visit has awakened, a visit which does
    not come from a house unknown to us, since besides holding
    in our memory the scientific renown which the University of
    Georgetown deservedly enjoys, and the marks of glory of which
    she boasts, we remember with that fondness which we owe to
    all that proceeds from the Father of our Country, the special
    recommendation which he made that Fernando Bolívar be educated
    in the celebrated and ancient College of Georgetown, which we
    see to-day converted into a great University._

    _"Venezuelan students have distinguished themselves always by
    love of liberty, and have sacrificed themselves with Ribas in
    the holy struggle for our independence. With equal love they
    venerate Science and Liberty. It is not strange, then, that
    they are full of joy in receiving envoys of a University which,
    on the banks of the Potomac and near the tomb of Washington,
    holds always aloft the ideals which the liberators of the North
    and of the South loved with passionate devotion._

    _"The professors and students of the country of Bolívar clasp
    cordially the hand which the University of Georgetown extends
    to them, and will deem it a signal honor to cultivate the
    friendship which tradition has originated and which the visit
    of your professor and your students will contribute powerfully
    to cement."_

    _Given in the City of Caracas, the fourth day before the
    Kalends of July in the year of our Salvation, One Thousand,
    Nine Hundred and Twenty._

                              _Farewell._

          _President of the Council of National Instruction_,
                         R. GONZÁLEZ RINCONES.

            _The President of the Commission of Theology_,
                          NICOLÁS E. NAVARRO.

       _The President of the Commission of Political Sciences_,
                          CARLOS F. GRISANTI.

            _The President of the Commission of Medicine_,
                             LUIS RAZETTI.

       _The President of the Commission of Physics, Mathematics,
                        and Natural Sciences_,
                            GERMÁN JIMÉNEZ.

     _The President of the Commission of Philosophy and Letters_,
                           R. VILLAVICENCIO.

       _The President of the Commission of Political Sciences_,
                       JOSÉ SANTIAGO RODRÍGUEZ.

              _The President of the Faculty of Medicine_,
                          LUIS FELIPE BLANCO.

       _The President of the Faculty of Mathematics, Physics and
                          Natural Sciences_,
                             LUIS UGUETO.

              _Secretary of the Council of Instruction_,
                          EDUARDO CALCAÑO SZ.

    [Illustration]

       *       *       *       *       *

Beginning Tuesday, June 29th, regular lectures in Spanish and economics
were held in a splendid room in the National Library of Venezuela
placed at the disposal of our group. The Director of the Library, Dr.
Manuel Segundo Sánchez, very graciously and with considerable pains
furnished the students with all books, documents, and information they
required, and during our entire stay in Caracas did all in his power
to make us comfortable and render our work successful. Dr. Sánchez
deserves the gratitude of the University.

The Minister of Public Instruction, Dr. Rafael González Rincones,
kindly gave the students letters of introduction to the persons in
charge of the different government offices who were in a position to
furnish them the most accurate information on the assigned topics.
Furthermore, all offices were thrown open to the Georgetown students,
and all the public officials placed themselves at their disposal
whenever they went to them in search of information or help.

[Illustration: REPLY OF UNIVERSITY OF CARACAS TO GEORGETOWN]

The work of the students was supplemented by several entertainments,
such as a luncheon given by the students of the Venezuela in the
Normal School; a reception tendered by the Seminary of Caracas, with
the attendance of the Archbishop and the Nuncio; a theatrical function
in the National Theatre; a picnic in a grove called Los Chorros; a
visit to an industrial exhibition where they learned of the remarkable
progress made by that country in recent years; and finally a concert
and theatrical performance by the College of San Francisco de Sales,
at which the "Star Spangled Banner" was sung by the students and the
United States flag and the Georgetown colors were displayed together
with the Venezuelan flag.

On one occasion the Federation of Students held a reception at the
School of Political Sciences in honor of the Georgetown students.
Addresses were delivered by the president of the Federation and
by your representative, who took occasion to describe some of the
characteristics of student life in the United States, which could not
but be of interest to students in other countries, terminating his
remarks with the expression of a sincere wish for closer relations
between the students of the University of Caracas and those of
Georgetown.

The College of San Francisco de Sales from the first day opened its
doors to the students of Georgetown, who found there a real home,
and they certainly used it to their best advantage, playing tennis,
baseball, and mingling freely with the students and the persons in
charge of that institution. The Reverend Jerónimo Gordini, Director
of the College, Dom Pardo and other professors of the establishment
deserve the gratitude of our University.

The authorities of the Military Academy of Venezuela, realizing that
most of the Georgetown students who were visiting that country had
seen service in the United States Army, tendered them a reception on
the Fourth of July, at which many distinguished ladies and gentlemen
of Caracas were present. The cadets gave an exhibition drill, after
which tea was served in the large hall of the Academy, which had been
beautifully decorated with flowers in combinations representing the
colors of the United States and Venezuela. The Director of the Academy
addressed the Georgetown men, welcoming them cordially; and your
representative answered in the following terms:

    "Mr. Director, Officers and Students of The Military Academy,
    Ladies and Gentlemen:

    "The idea of country finds expression in certain symbols which,
    powerfully impressed in the hearts of men, lead them to great
    deeds, even to the sacrifice of their lives, for principles
    radicated in their hearts and minds from childhood. Those
    symbols are the flag, the national anthem and the army.

    "The army is a country itself, converted into a weapon of
    protection and defense, and is constituted not only of men
    who form the ranks of the present, but also of the glorious
    traditions of the men who have formed the ranks of days gone by.

    "Armies are heirs to a rich legacy of honor, and in increasing
    that legacy and leaving it to their successors, they bequeath
    the noblest ideals of unsurpassed patriotism.

    "Were we to institute a comparative study of the achievements
    of the armies of the various countries of the world, we should
    find that no one of them surpasses the Venezuelan army in
    the glory of its traditions. You are the descendants and the
    followers of those men who, under the guidance of Bolívar's
    mighty genius, traversed this continent holding aloft the
    flag of liberty, creating countries wherever they went, and
    writing with their own blood the supreme epic of South American
    independence. You students of this Academy are the hope of
    your country. She trusts you as a fond mother trusts in the
    love and protection of her vigorous growing sons. You have an
    inheritance of which you may well be proud. This inheritance
    imposes upon you a great responsibility. You are to increase
    it, never to imperil it. You will never, I am confident,
    tarnish the purity of Venezuela's glory by not exemplifying the
    highest ideals of life or by not striving in every way for the
    promotion of Venezuela's welfare.

    "These young Americans who are here among you have been
    soldiers, and with the fellowship of comrades they are here
    in intimate communication with you, feeling a deep sense of
    respect for the sons of a sister republic which their fathers
    have long appreciated and loved. They extend the hand of
    brotherhood and ask you to believe that their purposes are also
    yours--the best service to their country and the preserving of
    the sacred inheritance of honor handed down to them by their
    forefathers.

    "Wherever patriotism is alive, wherever there exist the same
    inspiration and the same lofty purposes, comradeship is not a
    mere formula, but a union of souls. We feel that we have seen
    the very soul of Venezuela, and when we leave your hospitable
    Academy we shall carry away with us a deep respect and
    admiration for your country, for your institutions and for your
    army."

On the Fourth of July wreaths were deposited on the tomb of Bolívar and
statue of Washington. Addresses were delivered on the latter occasion
by the president of the Students' Federation, Mr. Atilano Carnevali,
and at the former ceremony by your representative.

A most pleasant interruption in our work was a four-day automobile trip
which lasted from Sunday, July 11th, to Wednesday, July 14th, and which
was provided by the Minister of Public Instruction.

On Sunday morning all arose at about three o'clock, and after taking
coffee, we boarded automobiles in the Plaza Bolívar, from which point a
start was made at five o'clock. I shall not undertake to describe the
wonderful Venezuelan mountains and valleys. They must be seen to have
their grandeur appreciated. The automobile roads passing through the
valleys and over the mountains are as good as can be found anywhere in
this country, and it is a matter of great surprise that so few tourists
visit Venezuela, where the scenery has no superior in beauty, where
the climate is unsurpassed in mildness and healthfulness, the safety
of travelers is as secure as in the best streets of a well-policed
city, and where the comforts of traveling--at least by automobile--are
as great as could be found in the United States, not to mention the
extreme courtesy of the Venezuelans, a quality which is not shallow,
but comes from the heart and makes all foreigners feel very much at
home.

At 6:15 A. M. the group reached the little town of Los Teques enveloped
in a morning mist, the stillness broken by the ringing of the bells
of a little chapel, calling the faithful to worship. We left the
automobiles and entered the church, and had one of the most charming
experiences of our lives by attending the service in that quiet country
shrine.

About 8:30 A. M. we arrived at a place called Guayas, where we had
an excellent breakfast. From there we continued our trip through the
valley of Aragua, which lies to the west of the valley of Caracas.
The entire valley of Aragua is rich with memories of Bolívar and the
struggle for independence. There stands his old farm, San Mateo, made
sacred by the memories of Captain Ricaurte, who blew himself and an
hostile army to pieces rather than allow the ammunition of the patriots
to fall into the hands of their foes. There lies the town of La
Victoria, where the brave general Ribas defeated the royalists with the
aid of the students of the city of Caracas. Every plain, hill, brook
and forest seems to speak of Venezuela's epic fight for independence.

At 12:30 we stopped at a place called San Juan de Los Morros, where we
enjoyed a bath in the sulphur springs, had luncheon as the guests of
the Minister of Public Instruction, and had the pleasure of meeting
the president-elect, the provisional president, and several other high
officials of the Republic. From San Juan de Los Morros we continued to
Maracay, a city of about 15,000 inhabitants, where the president-elect,
who is the Commander-in-Chief of the Army, generally resides.

Leaving Maracay early Monday morning and crossing the mountain range
which divides the valley of Aragua from the seashore, we journied
to the port of Ocumare de la Costa. The road is a constant marvel.
Carved in the live rock of the mountain, it climbs from the lowland
surrounding Lake Valencia up to the clouds, and actually pierces the
clouds until a spot called Rancho Grande is attained. From there it
begins to descend towards the Caribbean Sea. On the south side of
the mountains the beautiful lake of Valencia can be seen, visible at
times in its complete extension, surrounded by forests, sugarcane
plantations and cattle farms. The hills to the south are covered with
coffee plantations. There several small rivers finish their courses.
Stretching down to the seashore may be seen numerous cocoa and rubber
plantations.

Ocumare de la Costa is a very fine natural port. There Miranda and
Bolívar landed with their troops to fight for independence, and at
it, too, ten young Americans landed to join the Independent Army of
Venezuela. All these youths were made prisoners by the Spaniards and
executed. We saw the two beautiful monuments erected to their memory,
one in Maracay and another in Puerto Cabello. Colonel Romero, Commander
of the Port, entertained us at luncheon.

[Illustration]

In the afternoon we drove back by the same road and had still time to
visit Las Delicias, where there is a good zoological museum containing,
among other animals, beautiful specimens of herons, which produce
the famous aigrettes. It is to be noted that there is in Venezuela
a very stringent law against the killing of herons or even against
the plucking of their feathers. The aigrettes are to be obtained
only in the places where the herons assemble and drop their feathers
naturally, at certain periods of the year. In view of these facts it
seems reasonable to suggest that our law prohibiting the importation of
aigrettes should make an exception of feathers coming from Venezuela.

After spending a second night in Maracay, we left on Tuesday for a trip
around Lake Valencia. We visited a cream and cheese factory where the
most modern machinery is used in multiplying the products of the dairy
industry. On our way we visited the town of Güigüe, where we were the
object of the most courteous attention from General Romero Galván, who
accompanied us to the great coffee plantation of El Trompillo, owned by
the Pimentel family, two members of which, Don Antonio and Don Manuel,
made our brief stay as pleasant as it was instructive.

From El Trompillo we proceeded to inspect a sugar plantation called
Tacarigua, where the overseer in charge of the machinery explained to
the students all the processes in the preparation of cane sugar. From
Tacarigua we continued to Valencia, where we arrived in the afternoon,
having had luncheon in a small town called Bucarito. Valencia has been
called the most beautiful of tropical cities and, indeed, it deserves
the distinction. From Valencia we continued around the lake until we
arrived again in Maracay, after having once more admired the beauty and
splendid condition of the Venezuelan automobile roads.

Our last night we spent in Maracay, and on Wednesday started back to
Caracas. The return trip was made more slowly to enable us to stop at
several historical places and hear the interesting explanations very
kindly given by Dr. Manuel Segundo Sánchez, Director of the National
Library, who was our kind and learned guide and friend throughout the
trip. At San Mateo, we stopped and took several pictures of the house
where Captain Ricaurte made the supreme sacrifice of his life for the
independence of Venezuela. In La Victoria we visited several places of
historic interest and had a picture taken of the statue of the heroic
general Ribas. In Guayas we remained for over an hour resting. Late in
the afternoon we arrived in Caracas delighted with our trip and warmly
grateful both to the Minister of Public Instruction, to whose kindness
we owed the valuable experience, and to Dr. Manuel Segundo Sánchez,
to whom we owed most of the profit and pleasure derived from the
expedition.

Recitations and research work continued as before until Thursday,
July 29th, when we had the last formal class. It would be of interest
to recount some of the minor activities of the members of the class
if time and space would permit. For instance, several students were
charged to keep a detailed and accurate thermometric and barometric
record in order to demonstrate the fact that Caracas has a clearer and
less oppressive climate in summer than any of the great cities of the
north Atlantic seaboard of the United States. On Friday, the 30th, a
written examination in Spanish was held from 9 to 11, and at 11 o'clock
the students proceeded to the School of Social Sciences where our
course was to terminate with a lecture delivered by Dr. Pedro Itriago
Chacín, head of the diplomatic service of the government, professor
of international law, and a well known internationalist of Venezuela.
In the appendix of this report appears a translation of Dr. Itriago's
address. At the close of the inspiring address of Dr. Itriago Chacín,
a student in his course, Don Pedro La-Riva Vale, briefly expressed
the sentiment of fraternal feelings of Venezuelan students for the
Georgetown students. Some sentences from his remarks are not unworthy
of quotation.

    "Our satisfaction is greater when we turn our eyes to the pages
    of our diplomatic history, for we can not forget, if we are
    grateful, that North America, ever ready to foster noble ideas
    of Freedom, has always encouraged those who aspire to Liberty,
    with the same ardor which she inspired in the heart of her
    legionaries in the crusade for her freedom.

    "At the time of our emancipation, following her own indications
    that Congress would duly receive the representatives of those
    who fought constantly to give us a free country, the United
    States on June 26, 1810, sent to the Supreme Council of
    Caracas Mr. Lowry, in the capacity of financial agent, who
    had the duties proper to a consular position although he was
    not received in this capacity because it was not allowed by
    the form of government existing at that time. In 1811, the
    two Houses manifested their sympathy and interest for the
    newly-born sovereignties; it was Democracy sanctioning the
    conquests of Liberty. Later, Scott was made Agent of Supplies,
    and Lowry, Consul in fact; and Congress voted credits to
    establish legations, thus sanctioning our introduction into
    the community of free countries. In 1824, commercial ties
    were established which, strengthened day by day, are the
    vital arteries giving force to the economic organism of our
    nationalities.

    "Monroe, when he defined in his celebrated doctrine our rights
    to independence and formulated the prohibition to Europeans
    against colonizing in the new world, sanctioned in the most
    emphatic manner the highest achievement of American rights.
    "America for Americans,"--without any spurious interpretation
    such as some have given to it,--is the condensation of the
    efforts of the champions of the freedom of America, of this,
    our America, which has known how to defend its right amid
    the vibrations of its tempestuous seas! Bolívar, breaking
    the chains of slavery with an invincible sword, and Monroe,
    establishing a new concept of right, understand each other.
    Subsequently the Monroe doctrine was our shield in many
    transcendental events of our international life. It was the
    formidable weapon opposing the predatory ambition of England
    in 1895, when Grover Cleveland valiantly forced her to submit
    to arbitration her pretensions to the Venezuelan territory
    near the border of British Guiana. It was also our support in
    the incident brought about by Count Magliano, when he sought
    to obtain pressure from his own government, as well as from
    Germany, France and Belgium, on Venezuela. As for the coalition
    between Italy, England and Germany, those sorrowful days are
    not far distant, when our territory saw itself so seriously
    threatened, until finally the opposing parties agreed to submit
    their contention to the Supreme Tribunal of the Hague."

In answer to the stirring words of Dr. Itriago Chacín and Mr. La-Riva
Vale, your representative expressed genuine hope in the recovery and
substantial progress of the principles of international law based,
more than ever, squarely upon a thoroughly enlightened and responsive
public opinion. Democracy would, in the course of time, and perhaps
in a surprisingly reasonable brief time, come to contain a genuine
and significant meaning and guarantee of world peace. Perhaps at
present we are passing through reactions natural and inevitable after
the stupendous conflict from which we have just emerged, but those
who are able to measure the progress of culture on a larger scale
than the months and years, are not without great hope and substantial
confidence. He closed his remarks with the expression of sincere thanks
for the generous cooperation and sincere cordiality of the authorities
and students alike of the professional and academic world of Caracas.

On August 7th a reception was given at the School of Political Sciences
at which Dr. José Santiago Rodríguez, Director of the School, who
possesses a wide acquaintance with commercial and economic conditions
in the United States by reason of a careful survey of them made in the
interest of his Government, eloquently expressed the hope of closer
relations between the two countries, not merely with reference to
commerce and investment, but between the youth of both lands and on as
profoundly spiritual plan as possible.

Enthusiastic assurances of the sentiments of cordial solidarity towards
North America animating the sentiments of Venezuela was voiced by
a student of the School of Political Science, Don Aníbal Villasmil
Gabaldón. Again it was the pleasant duty of your representative to
express the appreciation of the students for all the courtesies and
sincere manifestations of friendship showered upon them, and to renew
the expression of confidence that the work of the University of Caracas
would go far in the firm and enduring upbuilding of an enlightened
public opinion, which would be regarded by the students of North
America as of the greatest service to mankind.

On Saturday, July 31st, two of our students left Caracas for the United
States. On Tuesday, August 3rd, six more students left, and on Monday,
August 9th, the rest of the students and your representative embarked
for New York. The steamer stopped for thirty-six hours at Puerto
Cabello, for some hours at Curazao, and for twenty-four hours at San
Juan de Puerto Rico. On Friday, August 20th, we landed in New York,
and thus came to an end the first university field work in economics
directed towards the expansion of American foreign trade.

During our stay in Caracas, the physical welfare of the students was
not neglected and consequently there were no serious cases of illness.
The change of food occasioned some minor ailments but no alarming
results occurred. All the members of the party were comfortably lodged,
and in all respects well taken care of by orders of the Minister
of Public Instruction. They had occasion also to engage in sports,
notably in baseball. Three public games were played, the first with
the students of the School of San Francisco de Sales, the second with
the American commercial employees of Caracas, and the third with the
students of the College of San Francisco de Sales, in which we won a
loving cup offered by the Minister of Public Instruction. Tennis was
frequently enjoyed and excursions to the beautiful mountain, Ávila,
were also organized.

Every opportunity was offered our students to mingle socially with the
best families of Caracas. Thus, they had not only the means to practise
Spanish, but also a rare opportunity to enjoy intimate contact with the
character of the Venezuelan people, whose constant kindness and genuine
courtesy made a deep and lasting impression on the Georgetown boys.

Among the persons entitled to our gratitude, besides those already
mentioned, are Dr. Vicente Lecuna, a senator of the country and the
President of the Banco de Venezuela, a man universally respected by
reason of his high moral character, who was instrumental in obtaining
for us valuable information and who showed himself tireless in his
efforts to help our students at every turn and on any subject; Dr.
Víctor V. Maldonado, the Director of the Industrial Exhibition; Mr.
Atilano Carnevali, President of the Federation of Students, and all
the members of the Federation; the Reverend Evaristo Ipiñázar, S.
J., Rector of the Seminary; Monsignor Nicolás E. Navarro, Apostolic
Prothonotary, and all the dignitaries of the Church, among whom
special mention is respectfully made of Monsignor Rincón González,
the Archbishop of Venezuela, and His Excellency, Monsignor Marchetti,
the Papal Nuncio. Dr. Manuel C. Correa of the Department of Public
Instruction, the Director of the Normal School and the faculties of the
University and of the different institutions of learning in Caracas
also deserve our grateful remembrances.

The Venezuelan press was extremely kind to us in its remarks. An
expression of sincere thanks is due to _El Nuevo Diario_, _El
Impartial_, _El Universal_, _Religión_, _Actualidades_, _Billiken_ and
other publications.

As a last honor, your representative was decorated with the medal of
"Public Instruction" by the Executive of Venezuela, according to a
decree of July 27, 1920, published in the _Official Gazette_ of the
country on Friday, August 13, of the same year, No. 14,138. In his
answer to the communication of the Minister of Public Instruction
notifying him of this honor, your representative made it clear that
this recognition is very superior to his personal attainments and is
to be considered an honor conferred on the School of Foreign Service
rather than on himself.[1]

                                        Respectfully submitted,
                                                  G. A. SHERWELL.

  _To_
  EDMUND A. WALSH, S. J.,
  _Regent of the School of Foreign Service_,
  _Georgetown University_,
  _Washington, D. C._

[1] The Medal of Public Instruction has since been conferred by
the President of Venezuela on John B. Creeden, S. J., President of
Georgetown University and Edmund A. Walsh, S. J., Regent of the School
of Foreign Service.

Dr. Sherwell was further honored by the Venezuelan Government with the
high distinction of membership in the "Order of the Liberator."

[Illustration: EDWARD FANNING WILLIAM JOHNSON JOSEPH P. QUINLAN GEORGE
A. TOWNSEND PAUL BABBITT FRANK CHIRIELEISON NELSON HOPKINS PHILIP D.
SULLIVAN THOMAS MORRIS JAMES F. COSTELLO DAVID SCHLESINGER MATTHEW
HEILER WILLARD C. FRAZEE EDWARD I. MURPHY J. HOMER BUTLER DR. SHERWELL
WALTER J. DONNELLY JAMES J. O'NEIL GEORGE E. MCKENNA]




PART II

STUDENT REPORTS




THE ECONOMIC HISTORY OF VENEZUELA


REFERENCES USED.--History of South America, W. H. Koebel; With the
Trade Winds, Ira Nelson Morris; The Land of Bolívar, Statesman's
Yearbook, 1918-1919; Reports of International High Commission; Reports
of Minister of Finance (Venezuela); Official Gazette of Venezuela.


GEOGRAPHICAL

The United States of Venezuela occupies the northernmost part of South
America bounded on the ocean side by the Atlantic and the Caribbean
and on the land side by British Guiana, Colombia and Brazil. It has an
area of 393,976 square miles (1,020,396 kilometers) with a population,
however, of only 2,848,121 or approximately 7 to the square mile. This
is in striking contrast with the figures obtained from the United
States Census of 1920 which shows an average population of 35.5 to the
square mile.

Venezuela is divided geographically into four zones, the _llanos_ or
large plains and river valleys which afford excellent opportunities for
the raising of cattle, the _mountain section_, formed by three mountain
ranges, the _table lands_ or plateaus and the _mining zone_. Venezuela
covers the same extent of superficial area as France, Belgium, Holland,
Denmark, Switzerland, Portugal, the United Kingdom of Great Britain and
Ireland. The country is especially fortunate in having an immense coast
line which extends over 1,800 miles. It has 32 ports, some 50 creeks
and bays, 7 peninsulas and 7 straits. Besides the Lake of Maracaibo,
which is the largest and of special importance, there are also 204
smaller lakes, 60 rivers, 8 of which are of the first magnitude. Along
with the variety of physical features Venezuela has a variety of
climate which permits the raising of many crops of the tropical and
temperate zones.


POLITICAL

Venezuela was sighted by Columbus on his third voyage in 1498, when he
entered the Gulf of Paria and sailed along the Delta of the Orinoco.
In 1550 this territory became the Captain-generalcy of Caracas and
remained under Spanish rule until early in the nineteenth century.

The modern history of Venezuela dates from the year 1813 when Simón
Bolívar took up arms against the Spanish Government and finally
defeated them at the Battle of Boyaca on August 7, 1819. Two years
later at Carabobo the Royalist forces were entirely routed and an end
was put to Spanish control in South America.

Simón Bolívar is venerated in Venezuela as the father of his country,
a title which he richly deserves. He was born in Caracas in 1783 and
from his earliest years his life seemed to be dedicated to the cause
of freedom. As a young man he studied in France and was an eye witness
to many of the scenes of the French Revolution, so that the spirit of
freedom and revolt against despotic government was further intensified
in him.

After his victory over the Spanish forces in 1821 Bolívar was formally
appointed President of Colombia which then included the present
republics of Venezuela and Ecuador. In 1830 Venezuela separated from
Colombia and became an independent state. The remainder of Bolívar's
public career was devoted to tireless labor in behalf of his people
that they might enjoy a stable and beneficial government. He died at
Santa Marta on December 17, 1830, almost penniless after having labored
throughout his entire life in the interest of his native country.

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.

In 1916 the Royal Bank of Canada opened a branch in Caracas and in
several other places in the country. Three years later the National
City Bank of New York entered the field and opened branches in Caracas
and Maracaibo. Other concerns which have opened branches are the
Anglo-Spanish-American Bank, Ltd., The Commercial Bank of Spanish
America, Grace & Co. of New York through their branch, the Venezuela
Commercial Company, and The Mercantile Bank of the Americas.

The currency is on a gold basis and gold coins of foreign countries are
accepted as legal tender. The coinage of silver and subsidiary metal is
restricted.

The bolivar, named in honor of the Liberator, is the monetary unit and
contains 1-1000 part of a kilogram of gold.

Gold coins are issued in 5, 10, 20, 50 and 100 bolivar pieces. Silver
coins are issued in 1, 2½, 5 bolivar pieces and 50 and 20 centimo
pieces. The smaller, token coins, are of nickel in 12½ and 5 centimo
pieces. The five-bolivar piece is commonly known as the "fuerte" and is
worth $.96½ in U. S. gold.


AIDS TO ECONOMIC DEVELOPMENT

Capital can be supplied in either of two ways: by investors from
foreign countries or through loans made by the government of Venezuela
to individuals who are unable to interest outside capital. For the
welfare of the country, the latter seems to be more advisable, as
it would reach a larger number of small farmers who are not in need
of large sums, and who moreover are not familiar with the financial
requirements of foreign investors.

A provision similar to the Federal Farm Loan Act passed in the United
States in July, 1917, would be of immense importance in aiding
agriculture enterprises.

The lack of immigration has long been a serious problem in the economic
development of this country; it can only be said that the government
has this question under discussion and probably something will soon
be done to induce immigrants to come to Venezuela where a multitude
of opportunities await them.[2] However, it will be necessary for the
government to assure this class of prospective citizens that the bulk
of desirable land is still in the hands of small holders and that the
power of the government is sufficient to protect the small farmers.

[2] See report on new Immigration Act, pp. 39-41.

In spite of the fact that the country is very sparsely settled, the
present railroad system is inadequate and large tracts of land are of
little or no value because of the expense of handling the products.
Obviously, the products of these areas can not successfully compete
in the world's markets, if the margin of profit has been absorbed
antecedently by high transportation expenses.

The oldest railroad is the Bolívar Railroad which was begun in 1873.
It is a 24-inch gauge, 176½ kilometers long and extends from Tuscasas
to Barquisimeto. The La Ciella line was authorized in 1880 and has a
91-meter gauge and a length of 81½ kilometers.

The most important road and one of the few which has paid any returns
is the La Guaira to Caracas line, which is about 23 miles long and was
built by British capital.

In passing it can truly be said that railroad development has been
retarded as much by political insecurity as by the undeveloped
industrial state of the country, the topography and the expense of
securing railroad equipment. However, the present administration is
giving considerable attention to this need and an extensive program of
wagon-road building is now in process of construction and plans have
also been perfected for extensive railroad expansion.


GOVERNMENT

The Republic of Venezuela was founded in 1830 by separation from the
other members of the "Free State" established by Simón Bolívar within
the limits of the old Spanish colony of New Granada. The Constitution
was modeled after that of the United States of North America, but
greater autonomy is allowed to provincial and local governments.

The chief executive is the President, elected for a term of six years,
assisted by six ministers and a Federal Council of 19 members. The
Federal Council is appointed by Congress every two years; the Council
chooses a President from its own members, who is also President of the
Republic. Neither the President nor members of the Federal Council can
be re-elected for the following period.

The legislative branch of the government is divided into two houses
called the Senate, whose members are elected for six years by the State
Legislatures, and the House of Representatives, whose members are also
elected for a six year-period, but by direct vote, one to each 40,000
inhabitants.

The country is divided into 20 States, 2 Territories and a Federal
District. The National Congress includes 40 Senators and 52
Representatives. Each state has an equal number of representatives,
each having a legislative Assembly, whose members are chosen in
accordance with its respective constitution.


PROSPECTIVE

Venezuela stands to-day upon the threshold of great interior
development especially in agriculture and cattle-raising. Her position
is similar to that of the United States after the Civil War when vast
areas, sparsely settled, lay awaiting the movement of population to
develop them. Her mineral resources are practically untouched and
opportunities await foreign capitalists who are familiar with the
development of new countries.

The political situation, however, should not be neglected. W. H. Koebel
in his "History of South America" says, "No state of South America
can show such a perpetual ferment, such a fog of unrest and strife
hanging over and choking its development as this." Whether or not the
past eight years of stable government and national prosperity has
demonstrated to the people of Venezuela the proper course to follow is
a question beyond the scope of the present inquiry.

In any event, the foreign investor will be well advised if he places
his capital in Venezuela only after mature consideration of the
political changes of the last two decades and the ability of the
present administration to carry through its policy of enlightened
development.

                                                    _James F. Costello._




POPULATION, IMMIGRATION, EDUCATION


REFERENCES:

  Census Bureau, Caracas, Venezuela, July, 1920.
  Memoria del Ministro del Fomento, 1920.
  Confidential Report of Department of Commerce, 1919.
  Memoria de Instrucción Pública, 1918, 1919, 1920.
  Memoria de Obras Públicas, 1920, Vol. 1.
  Encyclopaedia Britannica.

The last official census of Venezuela, which was completed in the year
1891, placed the population of the country at 2,323,527. According
to the Venezuelan Year Book of 1904, 10% of the people are white and
of European descent, but by far the larger part, possibly 70% of the
total, is a mixed race in which white and Indian blood prevail, the
remainder being pure Indian blood. It is not to be expected that the
new census, begun in August, 1919, will show any great changes because
of the three following reasons:[3]

1. The neglect of sanitation and hygiene in the past, which was
responsible for a heavy death rate.

2. The numerous civil wars and revolutions, which ended however some
fifteen years ago, when a reconstruction period commenced under the
present régime.

3. Comparative lack of immigration, the actual increase being balanced
by the yearly total of emigration of Venezuelans to foreign countries.

[3] In 1917 the population was estimated as 2,848,121. The last census,
1919-1920, may show some increase.

The future, however, holds brighter prospects due to the fact that
remedies have been found for the first two causes, and energetic
efforts are being made to increase immigration, as will be shown in
detail later.

Within an area of approximately 394,000 square miles the greater part
of the people is found in the regions of Lake Maracaibo, the Federal
District of Caracas and along the Coast, the Southern and interior
sections being to a great extent unknown and unexplored. The region of
Barquisimeto in the state of Lara is the most densely populated area,
while in Apure far to the south is found low swampy land, sparsely
populated, interlaced with a network of rivers, which in the rainy
season cover the entire country with a blanket of water, making travel
impossible for months and mail deliveries most difficult and irregular.

The agricultural zone extending along the coast and inland to the
Orinoco, employs 20% of the population in this pursuit alone, and
contains all the important cities of Venezuela, with the exception
of Ciudad Bolívar. The largest city is Caracas, with a population
(including the Federal District) estimated to-day at 137,687, an
increase of 47,687 since 1891. Its sea-port is La Guaira, connected by
a railroad winding around 23 miles of mountains. The second port of
importance is Puerto Cabello in the vicinity of Valencia, the second
largest city of Venezuela, which has a population estimated at 64,681.
Maracaibo with 48,480 is the third largest city in Venezuela, being
second in the country in business importance. This last district ought
to have the heaviest increase in the future due to the location of the
mines and petroleum wells in this area which attract the majority of
immigrants, while its heavy coffee exportations offer a wide field for
investment and employment.

Mérida, and Barcelona with its port of Juanta which serves the coal and
salt mining regions, are two important populous regions while other
cities varying in population from 10,000 to 50,000 are Ciudad Bolívar,
Barquisimeto, Trujillo and Juanare.

A glance at the following data, with the last two reports approximately
estimated, will serve to show the increase.

  1891 official census     2,323,027  Ratio per square kilometer     22
  1911  "       "          2,743,833  "     "   "      "             26
  1917  "       "          2,848,121  "     "   "      "             27

The most heavily populated districts are:

  Federal District       137,687  Density per square kilometer      70.2
  Carabobo               193,234  "       "   "      "              43.9
  Nueva Esparta           52,431  "       "   "      "              39.6
  Trujillo               185,624  "       "   "      "              24.4

The least populated states are:

  Bolívar       69,938  Density per square kilometer      .03
  Apure         30,008  "       "   "      "              .04

The territories which have had no increase since 1891:

  Amazonas            45,097  Density per square kilometer       .02
  Delta-Amaeuro        9,243  "       "   "      "               .02

Revised statistics June 19, 1920, for the city of Caracas:

  Catedral                12,229
  Altagracia              14,280
  Santa Teresa             6,050
  Santa Rosalia           19,284
  Candelaria              13,344
  San Juan                16,436
  La Pastora              11,409
  San Jose                 6,688
                        --------
    Total                 90,720
  Remainder of District   46,967
                        --------
    District total       137,687

Yearly increase of population estimated from comparative statistics of
births, deaths, immigration and emigration:

  1910                    28,091
  1911                    30,310
  1912                    11,797
  1913                    24,050
  1914                    24,988
  1915                    12,904
  1916                     9,589
  1917                    20,359
  1918                     8,308
  1919                    20,590


IMMIGRATION

The nationalities that immigrate to Venezuela, in order of numbers, at
the present time are Americans, Germans, Italians, Spaniards, Syrians,
Hollanders, with few French and English. Of these, the Spaniards,
Italians and Syrians alone, with a few odd exceptions, become citizens.
Before the war, Germany furnished the preponderant immigrant element
but to-day the Germans are coming in fewer numbers, and Americans are
increasing proportionately.

The reasons for the American increase are mainly the establishment of
three branches of the Royal Bank of Canada in Venezuela in 1916; the
National City Bank of New York with two branches, one in Caracas the
other in Maracaibo, and the Mercantile Bank of America with branches in
the same two cities. As mentioned above, the petroleum activities in
San Lorenzo in the Maracaibo district, the mines and coffee ventures,
also brought many Americans.

The lack of immigration in the past has been due mainly to sanitary
conditions, and the internal troubles of the country. The foreigner,
if unmolested long enough to build up a profitable business, faced the
danger of having it swept away, and his life endangered during one
of the frequent revolutionary outbreaks prior to the present régime.
However, great efforts are being expended to promote immigration as
vitally necessary for the future successful upbuilding of the country,
for Venezuela relies for her increase in population upon this source
and consequently several methods have been pursued to attain this end.
A glance at the laws of immigration formulated January 7, 1893, will
show the favorable inducements offered foreigners.

The Decree of 1893 created a Board of Immigration to promote
colonization. The Board is known as the Central Board of Immigration
and established subordinate boards throughout the country. These
societies, state societies, as well as private companies, were
authorized to make the following favorable concessions to induce
foreigners to come and colonize unused lands.

    1. Payment of the immigrant's passage by land and sea, from the
    place of embarkation to any of the main immigrant depots. The
    National Government may also pay the passage of the immigrant
    from the place of residence to the place of embarkation.

    2. Payment of landing expenses and board and lodging for thirty
    days after arrival.

    3. Admission free of duty of their wearing apparel, domestic
    utensils, and instruments of trade.

    4. Exemption of any payments for necessary passports.


SPECIAL PROVISIONS

All rights accorded by law to aliens are guaranteed, and if naturalized
they are exempt from military duties, except only in case of foreign
wars.

Special provisions were also made in behalf of individuals and
companies organizing colonies for settlement in Venezuela.

The manner of making contracts with immigrants is carefully specified
in the following manner:

    (_a_) Those who purchase lands during the first two years of
    their settlement, shall not be bound to pay the price thereof
    until after the expiration of four years, counted from the day
    actual possession is taken. They can not dispose of the land,
    however, during this period.

    (_b_) The title is not to be determined until the stipulated
    price is paid and the required cultivation and residence proved.

Special provisions and concessions were also made for the colonization
of public lands by private individuals and companies.

There is an annual appropriation in the National Budget to promote this
project. At the time of this writing, Mr. Simon Barcelo is in Europe,
traveling through the different countries inducing immigrants to come,
and acting as a forwarding agent. The result of his endeavors is being
manifested in the increased number of immigrants arriving within recent
months.

Venezuela's immigration is bound to increase in the future, for
advertisement is bringing results. The subjoined statistics will show
that this is not the only problem confronting the Government, for the
balance of immigration and emigration is only slightly in favor of
the former, as many Venezuelans leave the country yearly for the West
Indies, the United States and Europe. Whereas before the war, the
majority of the youths were educated in Europe, and travelers naturally
sought Europe, difficulty of communication and transportation during
the war turned the stream toward the United States, and the present
popularity of Americans in Venezuela bids fair to perpetuate this
condition of affairs.

  _Year_    _Immigration_   _Emigration_
   1910         8,273           7,233
   1911         9,204           7,219
   1912         9,615           7,981
   1913        11,617          10,708
   1914        10,610           9,742
   1915         9,818           8,770
   1916         8,596           7,639
   1917         7,857           7,182
   1918         6,153           5,841
   1919        12,433          12,897


PUBLIC EDUCATION

Education in Venezuela is free, and in the six primary grades is
compulsory, the schools from the ages of 7 to 14 years being maintained
by the National Government, State, or Municipality, the Department
of Education being under the direct supervision of the Minister of
Public Instruction, with subordinate officials forming a board. In
1908 Mr. Guillermo Todd, a distinguished Venezuelan educator, was sent
to the United States, where he spent two years in the larger cities
inspecting the school system, the normal schools and universities. On
his return he was appointed superintendent of schools, and reorganized
the system, introducing many American ideas and methods which largely
prevail to-day.

The maintenance of the educational system depends upon the receipts
from stamps, from post-cards and letters, from fines collected from
violators of the instruction laws; from taxes upon inheritances,
imposts upon tobacco leaves and manufactures, and from the proceeds of
the revenue stamps placed upon boxes of cigars.

During the school year of 1919 there were founded two primary schools
with three teachers each, two with two teachers and nine schools
with one teacher. Two schools were suspended and eleven changed into
co-educational with one teacher, while thirteen schools changed their
location. Heretofore education has followed the population only.
Outside the cities, towns and large cities near the coast there were
scant educational facilities, and the rural population was to a large
extent uninstructed, there being no schools nor teachers. During
1917 a movement was inaugurated to establish rural schools in all
industrial districts, and migratory schools of this kind are now in
operation in Frujillo, in Mario El Cantado and Caracas, the states
and municipalities have taken the matter in hand. On September 19,
1919, a decree was passed by the National Government to offer a bonus
in the form of wages, of from 100 to 200 bolivares ($20.00 to $40.00)
to competent persons possessing a certificate of primary elemental
instruction, who would enroll and teach children below fourteen years
of age the rudiments of education in localities of small population
where there were no public schools nor teachers. The bonus to be
received varied according to the number of pupils enrolled; many small
classes are now in operation throughout the rural districts.

The Obligatory Instruction Law compelling children from 7 to 14
years of age to attend class has been rigidly enforced by Government
decree during 1919; a list of offending parents is compiled and they
are visited by educational officers, and fined if found guilty of
not sending their children to school. By an order of June 20, 1919,
English is to be henceforth taught in all primary schools, in view
of its present importance as a commercial language. On September 1,
1919, appropriation being made, two new Manual Training Schools were
founded, one at Mérida, the other at San Cristobal. Physical training
is now considered an important part of the training, and at least a
half-hour a day is spent in calisthenics and gymnastic training. In
1918 the Boy Scouts movement was proposed, and introduced into the
schools of Maracaibo, where under the supervision of Mr. W. Douglas
it has been intertwined with the courses of the public educational
institutions. This movement is now receiving national prominence, and
gained favorable commendation in the Memoria de Instrucción Pública
(1918).

According to the latest data, there are approximately 1,500 primary
schools in Venezuela with 50,000 pupils enrolled, but the system is
laboring under the difficulty of a lack of teachers, due to inadequate
compensation. The children attend school six days a week, but on
Saturday have class in the morning only. The curriculum consists
of a daily lecture or assembly, elements of the Spanish language,
arithmetic, the legal system of weights and measures, rudiments of
etiquette and hygiene, moral and civic instruction, gymnastic exercises
or national songs, and elements of manual training. The afternoon
classes embrace writing, geography, history, topics of the day and
gymnastic exercises.

The Secondary Education of Venezuela is not as generally widespread, in
proportion, as primary education. There are 102 schools of this class
corresponding to high schools in the United States; 58 are for boys,
38 for girls, and 4 are co-educational. Some are grouped into Federal
Colleges and Normal Schools annexed to Federal Schools in Caracas and
Valencia.

Caracas is nominally the center of education in Venezuela. Here are
found two normal schools, one for men and one for women, and two
national schools of arts and trades, one for each sex. In 1917 Schools
of Commerce were instituted at Caracas, Maracaibo, Puerto Cabello,
Curúpano and Ciudad Bolívar. These are similar to our own commercial
schools, teaching languages, bookkeeping, stenography, accounting and
the like. Besides, there are found throughout the country thirty-four
schools of higher instruction, and twenty-one subsidized by the
Government.

One institution, founded June 30, 1919, may be interesting to note,
_viz_, the National Telegraph School of Caracas in which the first
pupils were enrolled from July 1 to 7, 1919. The school is situated in
the Federal Telephone and Telegraph Building.

The candidate must have the following qualifications:

  1. Be a Venezuelan.
  2. Over 15 years of age and under 25.
  3. Have had elementary primary instructions and the certificate issued
        for the same.
  4. Be of good character.
  5. Have no contagious diseases, and no physical defects.
  6. In case he is a minor he must have the permission of his legal
        guardian.

There are six National Universities, located in the following cities:

  1. Central University of Caracas.
  2. The University of the Andes at Mérida.
  3. The University of Valencia in the State of Carabobo.
  4. The University of Maracaibo in the State of Julia.
  5. The University at Ciudad Bolívar in the State of Bolívar.
  6. The University of Barquisimeto in the State of Lara.

The following courses are pursued in the Universities: Medicine, Law,
Political Science, Philosophy and Letters, Dentistry and Pharmacy.

The length of these courses is six years with the exception of
pharmacy, which is a four-year course.

Among the professional schools the following are of greater importance:

1. School of Engineering at Caracas.

2. School of Naval Construction at Puerto Cabello.

3. School of Political Science at San Cristobal.

4. School of Medicine in Caracas (founded December, 1915). A free
dispensary is attached, subsidized by public funds under the direction
of Civil Hospitals.

5. School of Dentistry, Caracas (1916).

6. School of Sciences (Physical, Natural and Mathematical) Caracas
(December, 1915).

7. School of Chemical Research.

Of the Academies the more important are:

1. Those of natural science, music, oratory and modern languages found
in the larger cities.

2. The Academy of Language in Caracas devoted to the national language
and literature.

3. The Academy of History in Caracas devoted to national history.

4. One seminary at Caracas,--the Catholic Seminary for Theology and
Canonical Jurisprudence.

Under "miscellaneous" we may consider the following:

The National Library of Caracas containing 50,000 volumes; a national
museum containing a valuable historical collection; the Cajigal
Observatory devoted to Astronomical and Meteorological work; the
libraries of Valencia and Maracaibo, and the Pasteur Institute in
Caracas.

Among the educational achievements of the past few years, the following
are worthy of mention:

1. Departments for engineering work.

2. Departments for the administration of budget.

3. Improvements in laboratories in physics, mineralogy, geology, botany
and zoology.

4. Enlargement of the libraries and improvement of the school of
medicine.

5. The schools of arts and crafts for men has 541 men enrolled. The
clever map making of the students should be especially noted.

6. The meteorological stations in Mérida, Maracaibo and Calabozo.

The appropriation for education for the fiscal year July 1, 1920 to
June 30, 1921, recently passed by the Venezuelan Congress, contains the
following items:

                                       _Bolivares_
   1. Ministry                            120,580
   2. National Council of Instruction     119,016
   3. Primary Education                 2,465,542
   4. Secondary Education                 259,240
   5. Normal Education                    203,940
   6. Board of Inspection                 135,600
   7. Superior Instruction and Institutes
        of University Extension           373,781
   8. Special Instruction                 326,672
   9. Celebrations and Entertainments     143,940
  10. General Costs                       180,000
                                       ----------
          Total                     Bs. 4,328,181

It may be said in conclusion that Venezuela fully recognizes the
importance of sound educational institutions and every effort is being
expended to bring about the desired results through legislation. The
work is slowly materializing but assuredly progressing. By far the
greatest problem is the lack of professors. Educational progress has of
necessity been retarded in the past but as the era of prosperity of the
country has been gradually, but surely, dawning, this important branch
has not been neglected, and a brighter future is before the Venezuelan
youths which will preclude the necessity of going abroad, as they have
done in the past, to complete their training.

The country has need of highly educated men; it is determined to
provide the institutions necessary to satisfy these needs.

                                                     _Thomas F. Morris._




PORTS OF VENEZUELA


With an increasing commerce and steady betterment of domestic economic
conditions, the ports of Venezuela are rapidly assuming a position that
for continued development and general good condition has never been
equalled in the history of the country. All countries recognize the
vital economic value of ports and with few exceptions can gauge their
own prosperity by the nature and number of their harbors. Few countries
are more dependent upon their ports than Venezuela. Because of poor
inland communication with neighboring countries, and an inability to
maintain itself, largely due to lack of manufactures, and due also to
a marked dependence upon the outside world for the marketing of its
products, this nation is to a high degree reliant upon its foreign
commerce and hence, in turn, upon its ports.

Fortunately, Venezuela has a long coast line of 3,020 kilometers,
indented with 32 harbors, 50 small bays and many coves. The most
important ports in the approximate order of importance are: La Guaira,
Maracaibo, Puerto Cabello, Ciudad Bolívar, Carúpano, Puerto Sucre, La
Vela, Cristobal Colón, Caño Colorado, Guanta, Pampatar, Imataca and
San Antonio del Táchira. At the present time many of the best natural
ports and the most favorably situated are still undeveloped or occupy
a secondary position. This is partially due to the lack of development
of their naturally rich and fertile hinterlands, difficulties of
transportation and unsympathetic government legislation. However,
remedies are now being applied and it can safely be predicted that
certain of the minor ports will soon outstrip the older and better
developed ones. A brief survey will serve to show the general nature
and economic status of some of the better known ports.

Chief in importance is LA GUAIRA which, connected with Caracas by 24
miles of railroad, stands as the commercial center of Venezuela and
will be treated in more detail later.


MARACAIBO

    Situated on a fresh water lake of approximately the same size
    as Lake Erie, the Port of Maracaibo drains a large hinterland.
    Coffee and petroleum are its two important exports. Besides
    that of Venezuela, much coffee of Colombian origin is exported
    from the port. It may also be noted that there is an ever
    increasing exploitation of petroleum and a corresponding demand
    for harbor facilities. Physically the port enjoys a great
    advantage in being located on a large lake fed by numberless
    rivers.

    The lake itself could accommodate vessels of thirty-foot draft,
    while three of the largest rivers, the Catatumbo, Lulia and
    Escalante can be travelled by river steamers of fair size.
    The two former streams are navigable as far as Villamizar in
    Colombia, and afford a fine transportation route for the coffee
    and other products of Santander. However, the port suffers a
    great disadvantage, as the main channel leading into the port
    is obstructed by a bar. The depth of water on this bar ranges
    from seven feet at low tide to twelve feet at high tide. The
    project of dredging the channel seems to be entirely feasible
    and if accomplished would add greatly to the general prosperity
    of Venezuela.


PUERTO CABELLO

    Deriving its name from the fact that its waters were considered
    so placid that a vessel might anchor within its protection
    sustained by a single strand of hair, Puerto Cabello remains
    the most sheltered port of Venezuela. Equipped with a floating
    dock 282 feet long, 80 feet wide and 21 feet high, it is
    able to take care of vessels up to 2,000 tons and has proved
    especially serviceable for the small steamers that serve the
    coast cities of Venezuela and Colombia. Coastwise vessels of
    light tonnage are constructed here and repairs of an extensive
    nature may be made. Many improvements to the ship building
    plant and repair docks are under way and the new floating
    dry dock when completed will permit the docking of vessels
    up to 4,000 tons, which means that it will be capable of
    accommodating practically all vessels that touch Venezuelan
    ports. The average depth of the harbor is 28 feet. Cattle are
    an important export, large consignments being made from the
    surrounding country. A frozen meat establishment controlled by
    English interests is of considerable value to the port, the
    meat being shipped to England in special ships. Puerto Cabello
    is 20 miles distant from Valencia and has railroad connections
    with both it and Caracas. Other exports besides cattle are
    coffee, cacao, dyewoods, hides, skins, and copper ores.


CIUDAD BOLÍVAR

    A river port situated on the right bank of the Orinoco 240
    miles above its mouth, Ciudad Bolívar is the commercial center
    of the Orinoco basin. A bar which blocks the river channel
    prevents ships of more than twelve feet draft from navigating
    the harbor. Due to the large quantity of sand deposited by
    the river and its tributaries, dredging is practically an
    impossibility. Vessels of less than twelve feet draft can go
    up the Orinoco as far as San Fernando de Apure. The principal
    exports are cattle, horses, mules, tobacco, cacao, rubber,
    tonka beans, bitters, hides, timber and other forest products.
    The port has connections with government land lines, regular
    communication with the lower and upper Orinoco and steamship
    lines to New York and the Antilles. The government imposes a
    surtax of 30% on imports from the West Indies which greatly
    diminishes the commerce of the port.


MINOR PORTS

    =Carúpano= is well located for commerce, being on the Caribbean
    coast at the opening of two valleys. It is the commercial
    center of the rich and populous hinterland of the valleys
    of Tunapui and Pilar and the valuable forests of Coiguar.
    The principal exports are coffee, cacao, cotton and forest
    products. Although possessing fair wharves, the harbor is very
    open and cargo must be moved in lighters and launches to the
    piers. Traffic is almost entirely of a coastwise nature with La
    Guaira.

    =Guanta= is one of the eastern ports of the country and has an
    excellent natural land-locked harbor. Its wharf can accommodate
    trans-Atlantic steamers, although commerce from abroad is
    light. The wooden pier, formerly in very bad condition, is
    being replaced by one of concrete. Guanta is connected by
    twenty-four miles of railroad with the coal mines of Naricuse
    and furnishes fuel for coastwise vessels. Large numbers of
    cattle are raised in the surrounding country and upon the
    completion of improvements the harbor should have a very bright
    future. By a government decree of 1917 the port was closed to
    import commerce and depends almost entirely upon exports for
    its functioning.

    =Puerto Sucre= is situated west of the city of Cumaná at a
    distance of less than a mile. It is equipped with a wooden
    pier constructed by the Cumaná and Carúpano Pier Company. The
    depth of water varies greatly and the loading and unloading of
    vessels is accomplished in lighters belonging to the company.
    The commerce of the port is small, most being undertaken with
    the neighboring ports of Venezuela.

    =La Vela= borders on a low swampy region and is connected by
    railroad with Coro. Except for a small coastwise trade with
    Puerto Cabello, the port enjoys little commercial activity.
    Coal mines are near by and with their future exploitation an
    increase in commerce may be expected. The waters of the harbor
    are unusually rough and lighters must be used for discharging
    cargo.

[Illustration: RANCHO GRANDE

THE ROAD THROUGH THE MOUNTAINS]

[Illustration: PORT OF OCUMARE DE LA COSTA ON THE CARIBBEAN]

While there are many other ports besides those mentioned above, their
commerce is so light and in such a poor state of development that more
consideration need not be given them here. For the most part, their
commerce is entirely coastwise and is carried on principally in small
sailing vessels. The fundamental obstacle to their future progress
and indeed to the progress of the entire nation seems to be lack of
population--a difficulty which the government is striving hard to
overcome by furnishing immigrants with free transportation, and paying
passport expenses.


SPECIAL PORT ACTIVITIES

At present there are no free ports in Venezuela and despite many
rumors and much discussion the establishment of a free port, at least
for some time, seems improbable. However, the Minister of Finance
has recommended the installation of bonded warehouses at some port
centrally located on the coast mainly for the better accommodation of
coastwise trade. Cargoes could be placed for a long period of time in
the proposed warehouses and the charges collected with the movement of
goods. The advantage of such a plan would be principally the ability
of profiting from market conditions and the fluctuation of prices.
The execution of this plan depends solely upon the legislation of the
government and will be officially considered in the near future.

Of far greater importance is the proposed project of transforming
Puerto Ocumare de la Costa from a small harbor with very little
commerce into a leading port capable of becoming a formidable rival
of La Guaira. For the accomplishment of this the former port would
have to be connected by railroad with Maracay, a distance of 43 miles,
and goods shipped to the territory which La Guaira now supplies.
The railroad would be very difficult to construct as it would have
to traverse a mountainous country and would take years to complete.
Engineers are considering the feasibility of the undertaking. The
reason for the new project is generally believed to be the raise in
rates of the La Guaira Harbor Corporation brought about by changing
from weight to volume measurement of cargo. The company justifies its
charge advance on the grounds that it was necessitated by the increase
in wages due to strikes. However, the government insists that the
raise is entirely out of proportion to the increase in salary paid.
The new rates impose an increase in charge of 37½% on coffee, 87⅓% on
cacao and 300% on hides. Proportionate increases are made on many other
articles.

It is needless to say that if the plan is carried out it will directly
or indirectly affect a large portion of the country. And whether the
economic advantages, such as new harbor development, the opening up
of new lands, and the increased mileage of railroads will justify the
disadvantage of large expenditures and risks involved is a question
that time alone can answer.


PORT OF LA GUAIRA

Formerly considered one of the most dangerous harbors on the Caribbean
coast, La Guaira is to-day Venezuela's leading port and the recipient
of a large volume of commerce both from Venezuela and abroad. Its
prosperity may be assigned to several causes. By reason of its
proximity to Caracas, the capital and chief city of the republic, the
port enjoys a great commercial advantage, as Caracas is a center of
transportation activities. Again, the harbor besides being favorably
located can accommodate vessels of large draft and possesses harbor and
warehouse facilities of an extensive nature. Government legislation has
also accomplished much to assure its preeminence as certain laws now in
force operate to divert much commerce to La Guaira that would normally
go to other Venezuelan ports.

The port works and equipment are owned by the La Guaira Harbor
Corporation, an English company that has undertaken improvements
totalling $5,000,000 and that have changed the harbor from a natural
to an artificial port. Before the improvements, the port was an open
roadstead--unsheltered and very dangerous. At the present time it is
protected by a stone and concrete sea wall, constructed from an average
depth of 29½ feet and rising 19½ feet above water. This protection
is ample and ships may move about and anchor in complete safety. The
sheltered area of the harbor is 75 acres and has an average depth of
from 28 to 30 feet. Entrance is made between the buoy at end of pier
No. 5 and buoy No. 4 placed at a distance of 300 feet. The maximum
range of tide is approximately 3 feet. Vessels of 23-foot draft can
safely navigate the harbor.

Landing is made at jetties inside the breakwater and the cargo is
loaded on cars and taken to warehouses. The jetties are three in number
and can accommodate three large or four small steamers. These jetties
are all equipped with railway facilities. Bunkerage is not available
and vessels must coal from lighters or cars on wharf. The port can
supply only a limited amount of coal, mostly Cardiff briquettes. Fuel
oil can not be obtained, but is available in large quantities at
Curaçao, 60 miles distant.

The population of the port is estimated at 26,000. The climate is
very hot with an average temperature of 84°. The prevailing winds are
northeast by southwest.

Though but 8 miles from Caracas, 24 miles of winding railroad through
the mountains are necessary to connect the port with the capital. The
line is owned by an English company, has a gradient of 4% and is of
3-foot gauge. From Caracas the Great Railroad of Venezuela operates a
road to the city of Valencia which in turn is connected by a third line
to Puerto Cabello.

The principal exports of the port are coffee, cacao and hides which are
sent principally to the United States, with which commerce is greatly
increasing. Much cacao of the better grade is exported to France.

The imports are textiles, chemicals, machinery, hardware, paper
products, drugs and medicines, of which 75% come from the United
States. Large return cargoes are difficult to get and at times
absolutely unobtainable.

The following statistics may serve to show the volume of commerce of
the port:

MOVEMENT OF CARGO FROM THE PORT OF LA GUAIRA

                       _1918_    _1919_
                      _Metric_  _Metric_   _Increase_
                       _Tons_    _Tons_    (_M. T._)
  Foreign imports      25,384    38,843      13,459
  Foreign exports      26,186    30,632       4,445
  Coastwise trade      55,446    64,195       8,748
                     --------   -------     -------
      Total movement  107,017   133,671      26,654

MOVEMENT OF PASSENGERS FROM LA GUAIRA

  _Year_
   1915     8,216
   1916     8,707
   1917     9,976
   1918     9,897
   1919    15,974

MOVEMENT OF CARGO FROM PORT OF LA GUAIRA BY YEAR SINCE 1905

  _Year_
   1905    92,489
   1906    89,299
   1907    93,548
   1908    63,012
   1909    74,414
   1910    81,525
   1911    91,996
   1912   105,844
   1913   116,116
   1914   110,498
   1915   104,583
   1916   113,351
   1917   123,963
   1918   107,017
   1919   133,671


PILOTAGE AND TOWAGE

Pilotage is not compulsory and is little used as entrance to the harbor
is easily made. When signalled for, the pilot boards the vessel about 2
miles off shore and proceeds to the port. Towage is very seldom used,
the only tug available being owned by the harbor corporation. The
charge for towage is $50 for a distance of from 4 to 6 miles off shore.

Mooring and shifts within the harbor are made from swinging buoys and
with the vessel's own equipment of capstan and winches. A mooring
charge of $0.0286 per net ton register is collected by the harbor
corporation both on steamers and sailing vessels.


LIGHTERAGE AND CARTAGE

The port is equipped with six lighters of 30 ton capacity, all of
which are owned by the corporation. They are principally used when the
mole is overcrowded and for the handling of large packages. Vessels
carrying explosives or other dangerous cargo must anchor just inside
the breakwater and discharge their goods into lighters.

Cartage for local delivery is accomplished by means of small
two-wheeled carts; most of the cargo, however, is handled by the
railroad with which the jetties are all connected.


STEVEDORING

Harbor conditions, on the whole, are satisfactory. When experienced,
the help is skillful and efficient but unfortunately is hard to obtain.
The employees have no union and are for the most part mulattoes. The
regular hours of work are from 7 A. M. to 4:30 P. M., while overtime
(daylight) is from 4:30 P. M. to 6:30 P. M.

The cost of discharging cargo is 60c. per hour during the regular
hours. For overtime in daylight the rate is increased 40c. and in night
time 60c. Tally clerks receive $3.00 per day with 40% increase for
overtime in daylight and double time after 9:00 P. M.

The time rate for handling cargo is about 20 metric tons per hour by
gang of 20 men. The discharging rate varies according to the nature
of the cargo as it can not be placed on the wharf faster than the
employees of the Customs House can check it.


PORT CHARGES

Of first importance are the charges collected by the government, which
include the following: An export tax on coffee, cacao, etc., which
is paid by the exporter, the vessel not being charged; a tax by the
captain of the port to the value of $2.41; interpreter's service,
which, however, is not compulsory, $6.18; port doctor fee $9.65 for
steamers and $4.83 for sailing vessels; pilotage, if taken, for
steamers $16.21, sailing vessels $11.58; government stamps, $1.93.

Vessels are boarded by the port doctor and a bill of health is required
from the Venezuelan Consul at the last port, also lists of passengers
and crew.

The port possesses an under-equipped hospital and a fee of $3.86 is
collected by the hospital association from each large vessel entering
or leaving the harbor. If proceeding to another domestic port a bill of
health is required and a charge of $2.35 is made by the government.

The municipality collects a water charge of $46.32 whether water is
taken on or not. If additional water is desired, a further charge of
77c. a ton is made. Other charges are made by the Harbor Corporation
including $0.0386 per net ton register for mooring and a similar sum
for each metric ton loaded or discharged during regular hours.


WHARVES AND WAREHOUSES

The breakwater pier is equipped with 3 jetties of concrete
construction, with a vessel clearance of 2,000 feet. The length of
jetty No. 1 is 70 meters, while that of No. 2 and No. 3 combined is
215 meters. Their width is 15 meters and the depth of water at low tide
is 30 feet. The jetties have a capacity of 6,000 tons of general cargo.

The pier is equipped with ten revolving steam cranes, the largest of
which is of 12 ton capacity with boom radius of 60 feet at an angle of
45°. The remaining cranes are of 5 and 3 ton capacity respectively.

The port has four warehouses with a total floor space of 5,134 square
meters. All are in charge of the government and are in good condition.
Strict regulations are in force and the Custom House processes are of a
character to discourage commerce.

The national tariff is highly protective, the government receiving
a large percentage of its revenues from this source. Few goods are
admitted free and those likely to compete with home industry are
severely taxed.


DOCUMENTS

  Necessary for port doctor:
    Bill of health.
    List of crew (register).
    List of passengers.

  Necessary for customs authorities:
    Ship's register (sometimes demanded).
    Consular dispatch from Venezuelan Consul, consisting of one
      sealed package with general manifest of cargo, consular
      invoices, bills of lading, etc.
    Two copies of crew list.
    Two copies of the passenger list.
    Two copies of the list of provisions and stores.
    Two copies of the "Sobordo" in hand.
    Two copies of the B/L sealed by Venezuelan Consul in the last
      port.

  Necessary for agency:
    Vessels bringing cargo from United States ports:
      1 copy of manifest.
      1 set of ship's export declarations.
      1 set ship's papers (from American vessels).

                                                         _Paul Babbitt._




OCEAN, CABLE AND RADIO COMMUNICATION WITH VENEZUELA


Venezuela, northernmost of the South American republics, comprises an
area of 393,976 square miles, including vast mineral resources and land
well suited for agricultural pursuits and cattle raising. Among the
principal agricultural products which Venezuela raises in sufficient
quantity for export to other parts of the world are coffee, cocoa,
sugar, tobacco and rubber. Other exports are gold, hides and skins.
Among the principal imports we find cotton goods, wheat flour, and,
in short, all manufactured articles used in the tropics except shoes,
laundry soap, candles, matches, salt, ready-made clothing and similar
articles upon which tariff rates are prohibitive.[4]

[4] United States Commerce Reports (No. 48-A), 1920.

It is within my province here to discuss communication facilities
between Venezuela and other countries, both in regard to steamship
facilities, and cable and wireless communication, for the purpose of
determining whether or not the existing lines of communication are best
suited to promote commerce between Venezuela and the countries to which
and from which she exports and imports products.

The first point to be considered is that of shipping communications,
since it is in ships that foreign commerce must be carried. In the
following pages we shall briefly discuss Venezuelan ports, volume of
shipping entering and leaving these ports and the countries and lines
owning and operating these ships.

The principal Venezuelan ports in order of their importance are La
Guaira, Maracaibo, Puerto Cabello and Ciudad Bolívar.[5]

[5] Reports of Trade Commissioner Bell, Commerce Dept.

_La Guaira_, due to its geographical position as the port nearest the
United States and Europe (2,000 miles from New York and New Orleans),
together with the fact that it is near Caracas, the capital and
commercial centre of Venezuela, is the most important port in that
country. It is therefore a port of egress and entry for Caracas and
central Venezuela. Besides being the capital and largest city, Caracas
is, to a peculiar degree, the centre of the commercial and industrial,
as well as the political life of Venezuela. Practically every company
engaged in any sort of business maintains an office in Caracas, which
accounts in part for the importance of the nearby port of La Guaira.

Due to the importance of coffee and sugar growing in the district
around _Maracaibo_, this port is the second in importance in
Venezuela.[6] It is situated at the entrance of a great lake which
opens the way to a territory rich in coffee and sugar plantations as
well as in coal mines and petroleum fields. Its only disadvantage is
the fact that a shallow channel which must be dredged continually
prohibits the entrance of vessels of large tonnage at many periods of
the year.

[6] Consular reports from La Guaira and Maracaibo.

The next port in importance, that of _Puerto Cabello_, is the inlet
and outlet for a district containing three of Venezuela's largest
cities, Valencia, Barquisimeto and Coro. This region is preeminently
agricultural in its activities and its prosperity is largely dependent
on its export trade in coffee, cacao, hides, skins, copper ore and
frozen meat.

_Ciudad Bolívar_,[7] fourth in importance of the ports of Venezuela,
is situated on the Orinoco River, about two hundred miles above its
mouth. In every respect its commerce is very different from that of the
rest of Venezuela, depending not upon the products of manufacturing or
agriculture, but upon wild products of the forests; upon gold mined
and washed in Venezuelan Guiana, and upon hides which are rafted down
the Orinoco and its tributaries from southern Venezuela and eastern
Colombia.

[7] Consular reports from Puerto Cabello and Ciudad Bolívar.

In order to give a clear idea of the ships and tonnage entering and
leaving the various Venezuelan ports, as well as their nationalities,
I have compiled statistics from the official figures given by the
Minister of Hacienda for the year 1918, the last year for which
figures could be obtained. A study of these figures shows the relative
importance of the ports of the country as well as the volume of
commerce with foreign nations.[8]

                                SUMMARY

       _Number of Ships Entering Each Port, January-June, 1918._

     PORTS              SHIPS            TONNAGE             TOTAL
                  _Steam_  _Sail_   _Steam_   _Sail_   _Ships_  _Tonnage_
  La Guaira          52      18     102,762      962       70    103,724
  Maracaibo          12      39       9,522    4,380       51     13,902
  Puerto Cabello     33      24     107,041    1,563       57    108,604
  Ciudad Bolívar     14       1       3,118        9       15      3,127
  Carúpano           14      14      17,145      184       28     17,329
  Puerto Sucre        5      33       2,474      285       38      2,759
  La Vela            --      33        --      1,797       33      1,797
  Cristobal Colón    13      36      13,250    1,307       49     14,557
  Pampator            2      44         511      630       46      1,141
                   ----    ----    --------  -------     ----   --------
      Total         145     242     225,823   11,117      387    266,940

  _Nationalities of Ships Entering These Ports, January-June, 1918._

     FLAGS              SHIPS            TONNAGE             TOTAL
                  _Steam_  _Sail_   _Steam_   _Sail_   _Ships_  _Tonnage_
  American           51      10      77,183    2,094       61     79,277
  Colombian          --       6        --        303        6        303
  Spanish             7      --      26,439     --          7     26,439
  French              6      --      14,771     --          6     14,771
  Dutch               3      33       7,251    2,913       36     10,164
  English            37       7      90,678      272       44     90,950
  Italian             3      --      16,962     --          3     16,962
  Norwegian          11      --      13,505     --         11     13,505
  Venezuelan         27     186       9,034    5,535      213     14,569
                   ----    ----    --------  -------     ----   --------
      Total         145     242     255,823   11,117      387    266,940

   _Number of Ships Entering Venezuelan Ports June-December, 1918._

     PORTS              SHIPS            TONNAGE             TOTAL
                  _Steam_  _Sail_   _Steam_   _Sail_   _Ships_  _Tonnage_
  La Guaira          72      53     112,498    4,835      125    117,333
  Maracaibo          28      19      14,968    1,480       47     16,448
  Puerto Cabello     27      25     111,369      915       52    112,284
  Ciudad Bolívar     14       1       3,118        8       15      3,126
  Carúpano            6      12       1,381      186       18      1,567
  Puerto Sucre       --      15        --        225       15        225
  La Vela            --      16        --        735       16        735
  Cristobal Colón    12      34       7,720    1,148       46      8,868
  Pampator           --      43        --        762       43        762
                   ----    ----    --------  -------     ----   --------
      Total         159     218     251,054   10,294      377    261,348

          _Nationalities of Ships Entering Venezuelan Ports,
                         June-December, 1918._

     FLAGS              SHIPS            TONNAGE             TOTAL
                  _Steam_  _Sail_   _Steam_   _Sail_   _Ships_  _Tonnage_
  Spanish            13              50,041                13     50,041
  French             14       2       3,011    3,060       16      6,071
  Dutch               3      28       1,914    1,693       31      3,607
  English            27       4      73,319       81       31     73,400
  Italian             6              33,924                 6     33,924
  Norwegian           4               6,184                 4      6,184
  Venezuelan         24     183       5,302    5,386      207     10,688
                   ----     ---    --------   ------     ----     ------
  Total             159     218     251,054   10,294      377    261,348

     _Number of Ships Sailing From Each Port, January-June, 1918._

     FLAGS              SHIPS            TONNAGE             TOTAL
                  _Steam_  _Sail_   _Steam_   _Sail_   _Ships_  _Tonnage_
  La Guaira          49      53      79,593    3,936      102     83,529
  Maracaibo          69     121      29,560   11,987      190     41,547
  Puerto Cabello     33     108      86,306    5,275      141     91,581
  Tucacas             4       5       4,065      557        9      4,622
  Ciudad Bolívar     14       1       3,512        9       15      2,521
  San Felix           3                 942                 3        942
  Barrancas           9       1       3,494        6       10      3,500
  Carúpano           17      29      17,304      614       46     17,912
  Rio Carila         15       2       1,096       16       17      1,112
  Puerto Sucre        2      45         118      882       47      1,000
  Guanta             13       9       5,515      511       22      6,026
  La Vela                    91                6,954       91      6,954
  Cristobal Colón     6     361      10,200    5,421      367     15,621
  Pampator            3     104         139    2,687      107      2,826
                   ----     ---    --------   ------     ----     ------
  Total             237     930     241,844   38,855    1,167    280,699

        _Nationalities of Ships Sailing from Venezuelan Ports._

     FLAGS              SHIPS            TONNAGE             TOTAL
                  _Steam_  _Sail_   _Steam_   _Sail_   _Ships_  _Tonnage_
  American           63      18      82,332    5,857       81     88,189
  Colombian                   4                  257        4        257
  Spanish             6              24,141                 6     24,141
  French              4       2      14,331      134        6     14,465
  Dutch              23     131      17,445   11,019      154     28,464
  English            56       8      48,391      407       64     48,798
  Italian             3              15,441                 3     15,441
  Norwegian          15              19,038                15     19,038
  Venezuelan         67     767      20,725   21,181      834     41,906
                   ----     ---    --------   ------    -----     ------
  Total             237     930     241,844   38,855    1,167    280,699

    _Number of Ships Sailing from Each Port, July--December, 1918._

     PORTS              SHIPS            TONNAGE             TOTAL
                  _Steam_  _Sail_   _Steam_   _Sail_   _Ships_  _Tonnage_
  La Guaira          45      48      93,167    3,449       93     96,616
  Maracaibo          63     121      28,565    8,280      184     36,845
  Puerto Cabello     34     135     105,769    2,521      169    108,290
  Tucasas             1       9       1,021      746       10      1,767
  Ciudad Bolívar     23       1       6,809        9       24      6,818
  Barancas            2      17         481      249       19        730
  Carúpano           14      23       6,626      578       37      7,204
  Rio Cariba          4       6         280      107       10        387
  Puerto Sucre        1      24          30      911       25        941
  Guanta              6      12       2,080      845       18      2,925
  La Vela            --      68        --      3,903       68      3,903
  Cristobal Colón     8     367       7,974    5,939      375     13,913
  Pampator            4     137         111    4,445      141      4,556
                   ----    ----    --------  -------     ----   --------
      Total         205     968     252,913   31,982    1,173    284,895

        _Nationalities of Ships Sailing from Venezuelan Ports._

     FLAGS              SHIPS            TONNAGE             TOTAL
                  _Steam_  _Sail_   _Steam_   _Sail_   _Ships_  _Tonnage_
  American           60       7      81,078    1,659       67     82,737
  Spanish            15      --      57,788     --         15     57,788
  French             22       9      11,893    1,910       31     13,803
  Dutch              17     106       9,404    5,859      123     15,263
  English            44      10      53,090      696       54     53,786
  Italian             4      --      22,772     --          4     22,772
  Norwegian           7      --       9,582     --          7      9,582
  Venezuelan         36     836       7,306   21,858      872     29,164
                   ----    ----    --------  -------     ----   --------
      Total         205     968     252,913   31,982    1,173    284,895

[8] United States of Venezuela: Ministerio de Hacienda; "Estadistica
Mercantil y Marítima."

As can readily be seen from these figures the chief commerce of
Venezuela is with American and European countries. The shipping service
is of two kinds--line service and tramp or charter service. The
former consists of actual steamship lines under an organized company,
operating on regular itineraries and on stated dates with regular rates
for freight, passenger and mail service. The latter refers chiefly
to sailing vessels of small tonnage, either engaged independently in
trade or under charter contract with firms or individual shippers for
a certain stipulated length of time, at certain rates mutually agreed
upon, and for stated cargoes and voyages.

Since, in this connection, line service is of the most importance
we shall first take up the various steamship lines operating between
Venezuelan ports and other ports of the world.



    =TRANSATLANTIC COMPANY OF BARCELONA=

    This is a Spanish line of steamships, having its home office
    at Barcelona, Spain. It was established January 21, 1882,
    and supplies a passenger, freight and mail service, making
    one voyage each month at intervals somewhat irregular. Its
    itinerary comprises the following ports:

    Barcelona, Genoa, Puerto Rico, Habana, Puerto Limon, Colón,
    Puerto Colombia, Curaçao, Puerto Cabello, La Guaira, Puerto
    Rico, Barcelona.

    The vessels in service are the Montevideo, Buenos Aires,
    Lyaysi, Montserrat, Antonio Lopez, Manuel Calvo, Satrustyui.

    Because of the length of time taken in transit this line does a
    greater freight than passenger business. Its rates are governed
    by those of other European steamship companies, since they are
    united under a gigantic ocean-carriers' agreement, which will
    be discussed later.


    =COMPAGNIE GENERAL TRANS-ATLANTIQUE=

    This is a French line, established June 27, 1872, with its home
    office in Paris. It supplies a monthly service for passengers,
    freight and mail. Its itinerary formerly was:

    Nazaire, Point a Pitre, La Guaira, Puerto Colombia, Cartagena,
    Colón, Puerto Colombia, Puerto Cabello, Port de France, St.
    Nazaire and Bordeaux.

    (N. B.--According to information recently received, this line
    now also calls at Havre.)

    The vessels in service are the Perón, Puerto Río, and Haiti.
    The service is not as regular as could be desired and rates
    are governed by the same conditions which apply to the Spanish
    company previously mentioned.


    =ROYAL DUTCH WEST INDIA MAIL=

    This is a Dutch line, having its home office in Amsterdam,
    Holland. Its service was crippled during the war, but it was
    reestablished in October, 1919. It supplies a freight and
    passenger service every fifteen days between the following
    points:

    Amsterdam, Holland, La Havre, La Guaira, Puerto Cabello,
    Curaçao, Puerto Colombia, Cartagena, Puerto Limon and Cristobal.

    The vessels now in service are the Stella, Crynssen, Styvessant
    and Orange Nassam.


    =HARRISON LINE=

    This is a British line, established in June 28, 1875, with
    its home office in Liverpool, England. It supplies a monthly
    freight and mail service between the following ports:

    Liverpool, Barbadoes, Trinidad, La Guaira, Puerto Cabello,
    Curaçao, Puerto Colombia, Cartagena, Colón, Beloge, Puerto
    Barrios, New Orleans, Galveston, Liverpool.

    The vessels in service are the Dictator, Author, Orator,
    Senator and Benefactor.


    =LEYLAND LINE=

    This is a British line, operating between the same ports as
    the Harrison Line, and also has its home office in Liverpool.
    It supplies a semimonthly freight and mail service between
    these ports. The vessels now in service are the Antillian,
    Alexandrian, Median, Nortonian, Nobian Asian and Nossian.
    These two British lines are most important as freight and mail
    carriers, the passengers carried being relatively small in
    number.


    =LA VELOCE LINE=

    This is an Italian line having its home office in Genoa, Italy.
    It was established in 1890 and supplies an irregular freight,
    passenger and mail service between the following ports:

    Genoa, Marseilles, Barcelona, Teneriffe, Trinidad, La Guaira,
    Puerto Cabello, Caracao, Puerto Colombia, Cartagena, Port
    Limon, Colón and Genoa.

    Its vessels in service are the Europa and Bologna.


    =TRANSATLANTIC ITALIAN COMPANY=

    This is another Italian company operating steamships between
    that country and the Americas. It is a new company, the service
    having been established August 10, 1920, with home office in
    Genoa, Italy. Its itinerary comprises the following ports:

    Genoa, Marseilles, Barcelona, Cadiz, Teneriffe, Trinidad, La
    Guaira, Puerto Cabello, Curaçao, Puerto Colombia, Cristobal,
    Balboa, Guayaquil, Callao, Mollendo, Arica, Casigua, Aristo,
    Fagasta, Valparaiso and Genoa.

    This line is equipped with three 12,000 ton motor vessels of
    recent design; the San Georgio I, San Georgio II, and San
    Georgio III, and supplies a passenger and freight service.

    These ships carry merchandise and raw material from La Guaira
    and Puerto Cabello to less accessible ports like Ciudad
    Bolívar, and from the latter port to the northern coast this
    company is rapidly increasing the number and tonnage of its
    vessels and undoubtedly will be an important factor in the
    commercial progress of Venezuela in the years to come.

       *       *       *       *       *

In referring to the great European steamship lines which touch
Venezuelan ports I mentioned the fact that a combination to control
freight rates existed. This is simply an agreement by which these
companies agree on maximum and minimum rates to be charged on certain
classes of goods. Undoubtedly such pooling has its disadvantages, since
it tends to keep competition out of the field.

We come now to a consideration of the one American line operating
between New York and La Guaira, _i.e._, the "Red D Line" of steamships.
I have purposely saved this for the last since, in considering this
subject from an American viewpoint, it is naturally the most important.
This line carries the mail, passenger and freight from American ports
to those of Venezuela, and is responsible to a great extent for the
proper delivery of merchandise sold to Venezuelan companies by American
firms.

The Red D Line has its home office in New York City, with branch
offices in Caracas, San Juan, P. R.; Curaçao, W. I.; Puerto Cabello and
Maracaibo. It is under contract with the United States Government for
the transportation of mail, and supplies a weekly service between New
York, Porto Rico, Curaçao and Venezuela.

In regard to rates and charges, among the most important of this
company's regulations are the following:

    (1) Rates are assessed per cubic foot, or 100 pounds ship's
    option, except as otherwise provided.

    (2) Packages containing different articles will be charged the
    tariff rate for the highest class article contained therein.

    (3) Packages of more than $100.00 in value must be noted on
    ships receipts when such goods are offered at the pier. Charges
    on packages of this kind will be in addition to tariff 3/4 of
    1% on all values over $100.00 per package. This company will
    not be liable in the event of loss or damage from any cause
    whatever as detailed in bills of lading, for more than $100.00
    per package unless such value is shown on shipping receipts and
    extra freight paid thereon.

    (4) Minimum charge to San Juan, P. R., $3.00; to Curaçao,
    Maracaibo, Coro and Puerto Cabello, $5.00; to La Guaira, Ven.,
    $5.00 plus wharf dues.

    (5) Heavy or bulky packages by special arrangement only.

    (6) This company requires two copies of bills of lading to
    San Juan, P. R., and Curaçao, D. W. I., and five copies to La
    Guaira, Puerto Cabello, Maracaibo and Coro, Venezuela.[9]

[9] Red D Line Freight Tariff No. A-1.

There are many additional regulations covering special cases, which it
is impossible to enumerate here. For those interested I would recommend
a copy of the Red D Line Freight Tariff No. 1-A, which may be secured
at any of this company's offices.

The ships now in service for this line are the Caracas, 3,000 tons;
Philadelphia, 2,500 tons; Merida, 630 tons, and the twin screw
steamers Maracaibo and Zulia, 1,800 tons each. Two additional vessels
for use on this line are now under construction in the States.

At the present time, however, it is to be regretted that comparatively
poor and irregular service exists between the two Americas. American
salesmen and business men operating in Venezuela constantly complain
of delays in forwarding mail and merchandise resulting in financial
loss for themselves and creating dissatisfied customers. Considering
the existing monopoly in communication, it is surprising that trade
between Venezuela and America has progressed to the extent that it
has. Venezuela is a rich country and can supply many varieties of
agricultural products to the United States; on the other hand, she must
look to the United States for manufactured goods, machinery, etc.,
to enable her to prosper. There is a wonderful opening for American
capital in the country of Simón Bolívar, but it never can be fully
realized until ocean communication between the two sister republics is
greatly improved.


CABLE COMMUNICATION

Cable communications with the exterior are at present monopolized by
the "French Company of Telegraph and Cables," through a concession
which lasts until 1929. This privilege is based on the first article
of contract which governs the Company's relations with the Government
of Venezuela; the privilege is exclusive and the controlling lines run
from La Guaira and La Vela, ports of Venezuela, to the Dutch Island of
Curaçao, thence to the Republic of Haiti, and thence to New York and
France. The price per word from Venezuela to New York is five bolivares
(approximately one dollar under normal exchange) but because of various
tariffs assessed by the company, and extra charges in delivery, the
rates usually exceed that figure. Moreover the service is poor and
uncertain, interruptions are frequent and a cable can not be depended
upon in matters of urgent importance. The company has not improved its
service and methods to meet the growing needs of an expanding business.
Something must be done to solve this difficulty of cable communication
before the potentialities of Pan-American trade can ever be realized.
But it can not be solved without the abolition or modification of the
present monopoly.


WIRELESS COMMUNICATION

Closely linked with the question of cable communication is the problem
of establishing wireless communication with foreign countries. In this
connection the recent severance of relations with Germany resulting
in a scarcity of materials and high prices greatly retarded the
installation of an improved wireless system with the outside world.
But on October 15, 1919, the government of the Republic of Venezuela
decided to call for bids for the construction of a wireless telegraph
station in the neighborhood of Caracas, the capital of the Republic.

The geographical situation of Caracas is as follows: Latitude North
10°-30'-24". Longitude 4°-25'-4" West of the Meridian of Greenwich. Its
altitude above the sea level is 922 meters and its distance from the
Caribbean Sea 10 kilometers. Caracas is separated from the coast by a
branch of the Andes Mountains which, in that part nearest to the city,
are 1,800 meters above sea level.

The technical conditions of the plant are:

    (1) The station must be of sufficient capacity to communicate
    with similar stations in Europe and the United States of
    America.

    (2) The station shall contain a plant for the emission of loud
    voices and another plant for the emission of subdued voices
    intended for communicating with wireless stations not yet
    equipped with the system of loud waves.

    (3) The necessary electric power will be furnished by a
    private concern in the shape of 190 volt, 50 cycle, 3 phase,
    alternating current as used in Caracas.

    (4) Furthermore, the installation shall include a set of
    reserve motors.

The bids must contain:

    (1) The general plan of the plant and the necessary detailed
    plans and cuts drawn on a convenient scale.

    (2) A general description of the apparatus.

    (3) The time necessary for its construction.

    (4) Total cost of the station. The amount will be paid in
    Caracas in quarterly installments, cash, at the end of each
    quarter, in accordance with the progress of the work. The
    government will retain 10% of the amounts of each payment,
    which sum will be paid to the contractor after compliance with
    the provisions of the next article.

    (5) The assumption of an obligation by the bidder to manage
    the station during six months after its completion as a proof
    of delivery in good working order. After this has been proved,
    the aforesaid 10% of the cost of the work will be paid to the
    contractor.

    [Illustration: BOLÍVAR'S HOME IN THE MOUNTAINS WITH STATUE OF
    THE HERO, CAPTAIN RICAURTE]

    [Illustration: ON THE ROAD FROM MARACAY TO CARACAS]

    The bids must be sent to the Minister of Fomento of Venezuela
    before the last day of June, 1920. On the last day of August,
    1920, in a Cabinet Meeting, the bid which in the opinion of
    the Federal Executive offers the greatest advantage will be
    accepted, while the Government reserves the right to reject all
    bids if it is deemed convenient.

    Any responsible construction concern--national or
    foreign--specializing in this work may send in a bid.

The importance of this proposed wireless station is very evident to
those interested in Venezuela, and its prosperity. By establishing
direct and efficient communication between this country and America and
Europe, it will open the way to vast trade possibilities.

Having thus discussed the three methods of communication which are of
paramount importance in foreign trade, we can not but realize that
Venezuela has been working under a serious handicap. However, she has
made great progress in the last decade and it is to be hoped that under
a wise government she will continue her sound trade policies and before
many years will take her proper place among the leading commercial
nations of the world.

                                                   _Philip D. Sullivan._




TRANSPORTATION FACILITIES


Pronounced improvements in the political, economic and social life of
the Republic of Venezuela have been effected within the last few years
by the construction, upon a broad and comprehensive scale, of a system
of national highways totalling, in extent of completed roads, 2,900
kilometers (approximately 1,800 miles). These have been specifically
designed to bear the burden of motor transportation both of passengers
and freight, as well as of all classes of vehicular and equestrian
traffic. Built primarily with a military objective, these roads already
have come to serve the routine needs of peace, while being at all
times available for the exigencies of war. They provide a means for
the quick mobilization of the Venezuelan army of 50,000 men at any
of the principal strategic points of the country. Infantry, cavalry
or artillery may with equal facility and despatch pass over any of
these roads to a given rendezvous. The broad, smooth highways compass
distances, grades and defiles that hitherto presented almost impassable
barriers to the quick and flexible movement of military forces.

If heretofore the army suffered from a lack of adequate transportation
facilities, the commerce of Venezuela too was woefully handicapped.
One of the greatest and most coveted of Venezuela's assets is her
magnificent coastline of hundreds of miles on the Caribbean Sea. To
realize the serious difficulties under which her rich interior labored
in seeking an egress to foreign markets, it need only be noted that
until the completion, during the last decade, of the highway system
with its three separate routes from three chief ports of the republic
to the capital and interior centers of industry, the country had the
use of only two railway lines. These lines were well constructed, it
is true, but offered an indifferent service at a prohibitive tariff
with amazingly excessive wharf and terminal charges. The only available
alternative to these consisted of old Spanish trails up and down the
mountain sides where the necessity of walking in single file hazarded
the necks of man and beast.

With respect to the technique of construction and maintenance of the
highways of the new system, local considerations and the requirements
of the major volume of traffic normally moving into or out of a given
section have been carefully taken into account. On the level stretches
of the extensive llanos in the interior, advantage has been taken of
natural dirt bases for roads that have come to sustain the burden of
the enormous production of cattle, grain, corn, coffee, cotton and
sugar sent forth from those fertile plains. On the precipitous mountain
slopes of the massive watershed that divides the highland llanos from
the sea, macadam has been the principal material used; this has been
true also in other mountain districts of the Republic. In general,
American and English principles of roadbed construction have been
employed and great numbers of steel bridges and not a few suspension
bridges have been designed, imported and set up by leading American
bridge-building corporations.

The improved route from Caracas to Guatire has made the latter
accessible at all times to the capital. The route from Caracas to
Barquisimeto supplies a direct road from the capital to the center
of the Venezuelan Andes, while the one from Maracay to Ocumare de
la Costa leads directly to the sea at the point of juncture of the
two greatest highways, opening the way to the agricultural and cattle
raising industries of the central region of the Republic.

The Great Eastern Highway leads from Caracas through the states of
Miranda, Auzoategui and Bolívar to the mineral region of interior
Guayana. The Great Western Highway connects the center of the Republic
with the remotest western regions, leading from Caracas to Valencia,
San Carlos, Guanare, San Antonio de Caparo and San Cristobal. It
crosses the most densely populated part of Venezuela and promises
to be, in the near future, the principal artery of communication.
Telegraphic connection is constantly maintained between the road
engineers and the minister of public works. The highway from Turmero
to Calabozo is likely to become the bond of union between the great
eastern and western highways. It has maintained traffic for the first
time in the llanos during the rainy season, thus furnishing a constant
outlet for the wonderful productivity of this region. Steam rollers
and other standard mechanical apparatus have been employed in the
construction work, while recently the authorities have commenced to
use the superficial petrolization process for laying the dust and
counteracting the impairment of the roadbed by the rapidly increasing
automobile traffic.

The equipment of the highways has brought to the fore another
characteristic and interesting Venezuelan institution--the road
workmen--who fulfill a dual function in the task they assume when a
road or section is completed: that of attending to, or assisting in,
its upkeep or repair, guarding against violation of the regulations
laid down for its use by the public, and otherwise policing a stretch
that is three kilometers upon macadam roads and two kilometers upon
natural dirt roads. The "peones camineros" represent but another and
latter-day application to public service of the marvelously faithful,
intelligent and efficient common labor of the country.

The mileage mentioned above is practically for motor vehicles and is
constantly used by the 2,000 passenger cars in active service. Had the
new road system been inspired and carried into execution by American
builders for the advancement of their own people's interests, they
could scarcely have served more thoroughly the purpose of American
commerce. From the outset, these roads have operated to strengthen this
country's position as a producer and exporter of automobiles. Thus a
vital public improvement, undertaken by the Venezuelan Government,
operated primarily to establish an altogether new market for one of the
chief industrial products of the United States. Yet despite the fact
that the capital of Venezuela, Caracas, has a population of 100,000
and boasts of having 1,000 automobiles or one car for every hundred
citizens, relatively few motor-trucks are to be seen there or, in fact,
elsewhere in Venezuela.

Nevertheless, it requires neither seer nor prophet to foresee
practically unlimited opportunities throughout the land of Bolívar
for every kind and class of American manufactures, from agricultural,
mining and factory machinery to the smallest articles of merchandise;
and this as the direct result of the building and extension of the
Venezuelan highway system. For transporting these manufactures from
ship's side to interior communities--some of them Spanish colonial
settlements that have flourished for almost four hundred years but
which until now have not known American importations--there is only one
logical and available instrument,--the American motor-truck.


RAILROADS

The standard gauge of the United States and Canada, 1.435 meters
between rails, was adopted by the National Congress of 1912, an act
necessary for any great capacity of railroad transportation as well as
the assurance of an immediate and adequate supply of materials.

Laws were promulgated June 12, 1917, and June 4, 1918, for the
concession, construction and operation of railroads by domestic and
foreign companies or individuals, containing the following provisions:

    1. That all enterprises be approved by the National Congress;
    that all controversies be settled in Venezuelan courts; that
    one-half of the employees be from Venezuela, and that no
    interest be guaranteed by the government on capital invested.

    2. That complete plans of any railroad project be submitted to
    the minister of public works prior to beginning operations,
    and that deposits of money be placed in the national treasury
    as a guarantee of integrity.

    3. That regulations and standard measurements be carefully
    observed; also provisions for roadbeds, crossings, etc.

    4. That the right be reserved to the National Government to
    take over railroads after forty years of service, if desired.

    5. That rival lines in close proximity to those already
    constructed be prohibited, and that branches or prolongations
    of existing lines be permitted in accordance with regulations.

    6. That rates fixed by owners be approved by the public
    ministry; that mails be carried free, and that reductions be
    allowed to government employees; and materials destined for the
    improvement of public works shall be transported at reduced
    rates.

    7. PRIVILEGES: that no oppressive taxes be levied on railroads;
    that a fair proportion of unclaimed lands be conceded to
    railways; that free transportation be allowed railway
    construction material; that railways be permitted to erect
    telegraph and telephone lines provided the government be
    granted gratuitous use of them; and that the employees be free
    from military service, except in case of international war.

There are twelve railroad systems in Venezuela at the present time with
a combined length of 600 miles and 40 millions of dollars invested
capital.

    1. =The Bolívar Railroad Company= owned and financed by the
    English with a working capital of $5,914,075 was the first
    railroad of Venezuela. The road is 88½ kilometers long, the
    gauge 0.61 meters. It has 165 bridges and 20 stations; the
    route is from Tucacas to Aroa. The number of passengers carried
    in 1919 was 24,408, and during the same period freight amounted
    to 38,820 tons.

    2. =The La Guaira-Caracas Railroad= is over 23 miles in length
    and carries the greatest part of the products of the country;
    it serves more than half of the central part of the republic.
    This railroad is the most important railroad in Venezuela,
    because it has direct connection with the Valencia and Puerto
    Cabello Railroad and the railroad going to Ocumare de la Costa.
    The length is 35.5 kilometers, the gauge 0.915 meters. There
    are 10 bridges, 8 tunnels and 9 stations and the route is from
    La Guaira to Caracas. It is owned by the English with a capital
    of $4,175,000. The number of passengers carried in 1919 was
    73,305 and freight amounted to 76,335 tons.

    3. =The Valencia-Puerto Cabello Railroad Company= is the second
    most important railway in Venezuela and performs the same
    service as the La Guaira to Caracas Railroad. It is owned and
    financed by the English with a working capital of $4,141,000.
    It has a length of 54 kilometers, the gauge is 1.07 meters and
    there are 23 bridges, 1 tunnel and 6 stations along the route
    from Valencia to Puerto Cabello. The number of passengers
    carried in 1919 was 53,990 and freight amounted to 55,121 tons.

    4. =The Grand Railroad of Venezuela= is owned and financed by
    Germans with a working capital of $15,000,000. The length is
    179 kilometers, the gauge 1.07 meters, there are 212 bridges,
    86 tunnels and 25 stations. The route is from Caracas to
    Valencia. The number of passengers carried in 1919 was 211,442
    and freight amounted to 76,335 tons. The rolling stock of
    this road consists of 18 locomotives, with a combined weight
    of 720 tons, 30 passenger coaches, 68 flat cars, 60 box cars
    and 19 stock cars. The passenger tariff equals 6¼ cents per
    mile for second class and 7.78 cents for first class. Freight
    rates are equivalent to 15.65 cents per ton mile. The freight
    traffic is small and nearly half the revenue is from passengers
    carried. The management attempted some development work in tree
    planting, the introduction of new crops, and the improvement of
    stock, but the grasshopper plague affected the results.

    5. =The Guanta-Barcelona Railroad= is owned and financed by a
    Venezuelan company with a working capital of $300,000. This
    road is 18.5 kilometers long, the gauge 1.07 meters; there
    are 4 bridges and 6 stations. The route is from Guanta to
    Barcelona. The number of passengers carried in 1919 was 13,553
    and freight amounted to 28,863 tons.

    6. =The Railroad of Carenero= is owned and financed by
    the French with a working capital of $1,576,800. It is 33
    kilometers long, the gauge 0.915 meters; there are 57 bridges
    and 5 stations; the route is from Carenero to San José. The
    number of passengers carried in 1919 was 20,037 and freight
    amounted to 6,923 tons.

    7. =The Maiquetia-Macuto Railroad= is owned and financed by the
    English with a working capital of $100,000. The length is 7
    kilometers, the gauge 0.915 meters; there are 8 bridges and 4
    stations. The route is from Maiquetia to Macuto. The number of
    passengers carried in 1919 was 430,668 and freight amounted to
    2,563 tons.

    8. =The Central Railroad of Venezuela= is owned and financed by
    the English with a working capital of $3,484,500. The length
    is 60 kilometers, the gauge 1.07 meters; there are 23 bridges,
    14 tunnels and 7 stations; the route is from Caracas to the
    station Tereza. The number of passengers carried in 1919 was
    326,945 and freight amounted to 22,971 tons.

    9. =The La Ceiba Railroad= is owned and financed by a
    Venezuelan Company with a working capital of $1,600,000. The
    length is 81.5 kilometers, the gauge 0.915 meters; there are
    43 bridges and 5 stations; the route is from La Ceiba to
    Roncayolo. The number of passengers carried in 1919 was 9,649
    and freight amounted to 21,706 tons.

    10. =The La Vela-Coro Railroad= is owned and financed by the
    Venezuelan Government with a capital of $208,000. The length is
    13.5 kilometers, the gauge 0.915 meters; there are 8 bridges
    and 3 stations; the route is from La Vela to Coro. The number
    of passengers carried in 1919 was 6,681 and freight amounted to
    10,828 tons.

    11. =The Grand Railroad of the Táchira= is owned and financed
    by a Venezuelan Company with a capital of $1,500,000. The
    length is 115 kilometers, the gauge 1.07 meters; there are 3
    bridges and 13 stations; the route is from Uraca to Táchira.
    The number of passengers carried in 1919 was 19,070 and freight
    amounted to 19,562 tons.

    12. =The Santa Barbara-El Vigia Railroad= is owned and financed
    by the Venezuelan Government with a working capital of
    $600,000. The length is 60 kilometers, the gauge 1.07; there
    are 37 bridges and 3 stations; the route is from Sta. Barbara
    to El Vigia. The number of passengers carried in 1919 was
    11,940 and freight amounted to 17,821 tons.

On several of the main roads traffic is lighter now than twenty-five
years ago, and notwithstanding the fact that rail transportation costs
no more than that by pack mule, scarcely any of the railway enterprises
have earned a fair return upon the capital invested, though certainly
transportation has been quickened and rates have been steadied, if
not cheapened. The principal reasons for this lack of earning power
lie in the sparseness of the population, and its distribution along
a long narrow strip of territory skirting the seaboard, a condition
which leads to the building of unconnected lines with short hauls.
Contributory reasons are the moderate producing and consuming power of
the people, and the general refusal of the lines to grant low rates for
the transportation of commodities of small value.

The waterways of Venezuela, numerous and general as they appear on the
map, are singularly disappointing on closer investigation. The great
Orinoco is a fine natural highway, it is true, as far as Pericos, some
600 miles from the mouth, but here the river is broken by the rapids
of Atures, and beyond by those of Maipures, hence it is impossible for
large boats to pass through to the upper river. The Apure, Arauca,
and Meta are, of course, useful means of communication with the
Colombian border regions and the southwestern llanos, but the numerous
tributaries on the north side are generally too variable in depth for
permanent traffic, and those on the south, as we have seen, are broken
up by rapids for practically their whole length.

On the other hand, if we take the positive value of the river
highways, rather than their actual extent, we shall see that they are
of considerable importance; the rivers of Guayana and of the eastern
llanos may be of little use for large boats, but the Orinoco forms
a great, central artery, from which roads, and perhaps eventually
railways, can diverge to the limits of the basin. Some of the llano
tributaries, too, are navigable for steamers, and thus the State
of Apure is now kept in communication with the outside world. Then,
too, there is the great advantage accruing to the State of Zulia from
its central lake, with its many tributary navigable rivers, along
which large boats can travel throughout the greater part of the State
and on to the boundaries of those of the Andes, as well as into the
neighboring republic of Colombia. Along most of these natural and
easily utilized lines of communication there are already services of
steamers, nothing very advanced, it is true, but still a beginning.

The most important of the accessible regions of the country are the
great plains stretching from east to west of the Orinoco and Apure
rivers, well suited to cattle raising, the rich alluvial region east of
Lake Maracaibo and the rich agricultural region around Lake Valencia.

Although these vast plains are open ranges covered with natural grasses
for cattle feeding, conditions, in general, are not those prevailing
in the Argentine Republic. The climate is much more tropical; tropical
diseases are prevalent, and the river valleys are subject to overflow
in times of high water. The higher lands farther north along the foot
hills of the coast range generally lack sufficient water during the dry
season of the year, which is December to June. Much could be done to
remedy this by the introduction of water through modern irrigational
devices.

The future of Venezuela depends primarily on her own people, upon whom
devolves the duty of developing in a conscientious and painstaking
manner the many resources of their country. It is certain that in the
task which lies before them they will need and obtain assistance of
foreign capital and advice, and in this, if American enterprise is
alive to a great opportunity, we as a nation should bear no small part.

                                                       _Edward Fanning._




AGRICULTURE IN VENEZUELA


The Agricultural Zone of Venezuela covers about 300,000 square
kilometers, according to recent statistics, and extends from the
Atlantic Ocean to Colombia, embracing the territory between the
Caribbean seacoast and the plains of the Orinoco towards the south of
the country.

Venezuela has fertile soil, perfect adaptability to the growth and
maturity of everything that is essential to the existence of man
and beast, mild climate, with temperatures varying according to
the elevation of the land and latitude, and strategic geographical
position. These favorable conditions designate Venezuela as one of the
most attractive and advantageous regions for agricultural pursuits.
Twenty per cent of the population are engaged in agricultural work,
but this proportion is far from being sufficient for an extensive
development of the natural resources of this vast area. It is
estimated that a population one hundred fold greater could derive a
comfortable subsistence from this agricultural region. This vast area,
including such a great number of square kilometers, should become one
of the most prosperous, rich and accessible agricultural fields of
the world following an increase in population, greater and improved
transportation facilities, and with the introduction of new methods of
cultivation and more general application of modern machinery.

The principal agricultural products of Venezuela are: coffee, cacao,
sugar, tobacco, India-rubber, tonka-beans, cotton, corn, vanilla, wheat
and kindred products.

The vegetable seeds are also numerous and consist of vetches, bean
seed, peas, beans, peanuts and okra.

The vegetable plants consist of: cabbage, cauliflower, melons,
asparagus, turnips, radishes, beets, egg plants, garlic, pepper,
celery, carrots, cresses, onions, spinach, lettuce and artichokes.

The fruits of Venezuela, of which there are many different species,
include: oranges, large sweet lemons, limes, plantains, pineapples,
pomegranates, figs, grapes, strawberries, plums, breadfruit, chestnuts,
mangoes, zapotes, parchas, medlars, tamarinds, cactus fruit,
mandarines, and a great variety of bananas of a very high quality.
There is a vast region available for the raising of bananas, but, up
to the present no use has been made of it and there is a very small
amount of capital invested in the production of this fruit ($100,000 in
American gold).


COFFEE

The cultivation of coffee in Venezuela began in 1784. At the present
time, it is estimated by experts that there are about 260 million
coffee trees under cultivation, which place Venezuela second among the
coffee growing countries, according to recent statistics.

Coffee is produced in the temperate climate regions of the Republic
from five hundred to two thousand meters above sea level. It is
estimated that coffee trees last from forty to fifty years, yielding
an average crop of one-eighth of a kilogram of coffee beans per tree.
Sixteen million dollars are invested in coffee trees in Venezuela at
the present time.


CACAO

Venezuela possesses one of the choicest cacao zones of the world. The
natural cacao (Theobroma edenda,--edible food of the Gods) is a seed
from a tree indigenous to the soil of Venezuela. From this seed the
chocolate of commerce is made. As the cacao tree requires for full
development and good crops a temperature of 80 degrees Fahrenheit, and
a moist air, therefore the Venezuelan lands along the coast of the
Caribbean Sea, sloping from the mountain tops to the shore, and which
are bedewed by the exhalation of the sea and irrigated by the many
rivers coursing down the valleys, are found to be well adapted in all
respects to the very profitable cultivation of cacao. It is, however,
also found and cultivated in other parts of Venezuela.

About two hundred trees may be planted in one hectare (about two and
one-half acres) and they must be protected from the sun by shade trees
until they have acquired normal size. Five years after having been
planted the trees begin to bear two crops a year, ripening in June and
December. The average life of a tree is about forty years. The seed is
similar to a shelled almond; about sixteen of these seeds are enclosed
in an elongated pod ribbed like a musk melon. The pods are of a yellow
and red color and when they become ripe turn purple. On being gathered
and heaped in piles on the ground, after a few days they ferment and
burst; then the seeds are shelled, washed and housed.

There are two grades of cacao grown in Venezuela, namely,--the criollo,
which is the native cacao, and the trinitario, which was originally
imported from the Island of Trinidad. The criollo, a very high grade,
grows especially well in the valleys situated near the sea, where the
temperature is warm and moist.

The demand for this product in Europe before the war was considerable
and large quantities were exported annually. In Spain and Italy cacao
is used in the form of chocolate, whereas in France, England and the
former German Empire, it is chiefly used in the manufacture of sweets
and confections, but its use is becoming so varied and extensive that
it will soon be a staple article of consumption as universally needed
as coffee or tea. Venezuelan cacao also finds a ready market in the
United States where it is known as Caracas and Maracaibo Cacao.

As the cacao-yielding region in the world is comparatively restricted,
the planters of this staple need not fear the increasing competition
which has been met in the cultivation of other staple products. At
the present time it is estimated that $12,400,000 are invested in the
cultivation of cacao in Venezuela.


TOBACCO

Tobacco, discovered by the Spaniards in Yucatan, was introduced from
there to the West Indies and thence transplanted to Venezuela, where
it is most successfully cultivated in Capadare, Yaritagua, Mérida,
Cumanacoa, Guanape, Guaribe and Barinas. Excellent tobacco is grown
near Cumaná, that from Guacharo being considered exceptionally good.
The plant thrives best in humid and fertile soil. Cultivation requires
about six months in Venezuela before it is ready for the market, and
while the cost of cultivation is not large, great care is required.

Some tobacco is exported from Venezuela, chiefly to Havana, where it is
mixed in the manufacture of Havana cigarettes.

The different classes of tobacco grown in Venezuela are distinguished
according to the regions where they are produced. These regions are

_Maturin:_

This grade of tobacco is produced chiefly in Venezuela and is used in
the manufacture of Venezuelan cigarettes. It is one of the better known
classes of tobacco entering foreign trade. This class of tobacco has:

1. Leaves which are light with relation to their bulk.

2. Medium strength, agreeable aroma.

3. It will keep in good condition for a maximum of two years but then
begins to rot and completely loses its strength.

_Capadare:_

This class of tobacco is considered to be better than the Maturin
tobacco. It maintains its strength and does not rot until three or more
years after it has been gathered. It has a very agreeable taste and its
weight as compared with its bulk is greater than that of the Maturin
tobacco and does not burn as fast as the latter. It is classified into
first and second class tobacco by the gatherers.

_Salon:_

On account of the very fine leaves and aroma which this tobacco
possesses it is used as the outer leaf in making fine cigars. It burns
well, is light in relation to its bulk and is classed by the gatherers
as Cover, Inner-cover and Core tobacco.

_Golfero:_

This region is on the shores of the Gulf of Cariaco and has recently
been planted with Havana tobacco seeds and is now producing a superior
quality. It has strength, aroma of a fine quality and burns very
well. It lasts about two years without rotting and on account of its
steady strength and agreeable aroma, it is very much demanded by the
manufacturers of cigarettes. It is divided into Principal, Half-tree
and Sprouts.

_Guaribe:_

This tobacco is rather strong, has an agreeable taste and aroma but as
a general rule does not burn well. It is used in the manufacture of
cigarettes, in small proportions, in order to give strength. It is also
divided into Principal, Half-tree and Sprouts.

_Cocorote_:

This tobacco is mostly used in the manufacture of cigarettes. It has a
delicate leaf, is light in weight, has considerable strength and good
taste. It is classified as Cover, Inner-cover and Core tobacco.

_Guacharo_:

This tobacco is produced near the Gulf of Cariaco in the vicinity
of the Guacharo Caves. It has an exceptional and superior strength,
a better taste and finer aroma than any other tobacco, not only of
Venezuela but of any place in the world where tobacco is cultivated.
There is only a small supply of this kind of tobacco because it will
not grow in any other region on account of the very mature strata
formation. The leaf is small and delicate; there is consequently
a great demand for it from the cigar manufacturers. Cigarette
manufacturers can not make use of it because the quantity produced is
too small.


PRODUCTION OF TOBACCO

The annual production of the different classes of tobacco in Venezuela
varies a great deal according to the conditions of the season and
the demand for the product. The approximate output between the years
1914-1919 was estimated at more than 3,000 tons from the different
regions. The average production above referred to is liable to increase
to a considerable extent provided the demand requires it, as soil fit
for tobacco cultivation is plentiful. The price of tobacco naturally
varies with the supply and demand and an increase of exports of tobacco
contemplated in the near future will tend to increase the prices. The
total value of tobacco exported from Venezuela in 1917 amounted to more
than $50,000; in 1918(?) the exportation amounted to more than $800,000.

The total amount of capital invested in Venezuela in the cultivation of
the tobacco plant is estimated at $2,000,000.


INDIA RUBBER

Rubber, which was discovered in French Guiana in 1758, is called
"caucho" or "goma elastica," in Venezuela. The rubber produced in the
Orinoco, Cassiquiare and Rio Negro sections of Venezuela comes from
forests of Heveas. There are other species of rubber trees but their
sap is less elastic and much thicker. The tree is found in plentiful
quantities throughout the Guiana section and the Andes Range, and in
some States of the East, West and South of Venezuela. More than twenty
tribes of Indians inhabiting the Amazon territory of Venezuela gather
rubber and prepare it, but, as a general rule, in a very primitive
manner.

In the Orinoco region the Hevea tree produces from 40 to 50 grams of
juice; in that of the Rio Negro from 80 to 100 grams and in that of the
Cassiquiare from 125 to 150 grams per tree.

Due to the fact that this product as well as many others of the country
are gathered within the vast territory bordering on Brazil, they are
exported through the Brazilian port of Para and reach American and
European markets as of Brazilian origin.

Rubber trees when cultivated in a scientific manner yield an average of
95% of pure rubber, each tree producing about 460 grams of juice.

The exploitation of rubber in Venezuela may be considered as limited
entirely to the gathering of the natural product on a small scale, as
the many million acres producing rubber would require several million
people to exploit them. The investment of capital on a large scale is
required to develop this important industry. First and most important,
labor must be induced to come to Venezuela in order to develop this
immense natural resource now scarcely touched. The world demand for
this product is great and rubber would undoubtedly be a profitable
investment for American investors if undertaken in a systematic and
technical way. It is estimated that not more than $1,200,000 are
invested in the rubber industry in Venezuela.


SUGAR CANE

Sugar cane is indigenous in Venezuela and cultivated with good
results. Lately, Sugar Cane Central Factories have been established
to manufacture the products of the sugar cane. These plants equipped
with the best modern improvements as to buildings and machinery have at
their disposal sufficient capital to enable them not only to supply the
home consumption but to export their products in considerable quantity.

The climate and the fertile soil of Venezuela are the principal factors
in the production of sugar cane, as it grows everywhere in Venezuela
except in mountainous parts lacking irrigation.

Four species of sugar cane are cultivated in Venezuela, namely:
Criolla, the Otati, the Batavian and the Salangore.

The Criolla is cultivated to the largest extent on account of its
sweetness and good results.

The planting and cutting of the sugar cane is controlled in such a
manner that there is always in the plantations sufficient cane reaped
and ready, in order to avoid interruptions in the grinding during the
whole year round. To ensure this continuity of crops, the soil must be
kept well irrigated at all times.

The region near the Lake of Valencia produces longer and thicker canes
having more juice, but they contain less sweetness.

Sugar plantations are usually divided into _Tablones_ covering ninety
meters square, each lot separated by a road. Such lots, when well
manured, irrigated and sown with sugar cane, produce sixty to eighty
loads of "papelon" (brown sugar), or 160 loads of alcohol: that is,
5,120 cones of brown sugar weighing 8,129 kilograms or 9,600 liters of
alcohol. Every plantation of any importance has a special building with
the necessary machinery and equipment for manufacturing the different
sugar products. These are: sugar, brown sugar, alcohol and rum.

Brown sugar is offered for sale molded in different forms such as
cones and squares. The best quality of sugar produced in Venezuela is
manufactured near Guatire, a town three hours distance from Caracas
by motor truck or automobile. Rum is manufactured from sugar cane and
alcohol. The previously mentioned Sugar Central Factories command an
aggregate capital of $7,700,000, have a total of 12,800 hectares of
sugar cane under cultivation and can produce 2,600 metric tons of
sugar per day. This product at present commands a high price abroad;
therefore, with proper management these plants now offer a Venezuelan
product for exportation in large quantities and of a very fine quality,
and for which without much difficulty they should be able to establish
a wide market.

As far back as 1913 there existed 600 individuals and companies devoted
to the cultivation of sugar cane, with an aggregate total capital of
more than $10,600,000 invested in this industry.


WHEAT

This product was introduced into Venezuela by the Spaniards at the
beginning of the conquest and was cultivated in Aragua, Barquisimeto,
Trujillo, Mérida and the Táchira. The high table lands and valleys
in the mountainous regions of Western Venezuela are available for
cultivation of wheat. Fine crops of this grain are now raised, which,
after being made into bread, is the chief breadstuff of all classes of
the country.

In the Republic of Colombia wheat is cultivated on a large scale with
good results both in cold, temperate and hot zones. Venezuela has
similar zones, therefore by sowing the proper kind of grain in each
zone as practiced in Colombia and by adopting the same or similar
systems of cultivation as are there used, wheat could easily be raised
in Venezuela not only for home consumption, but for export.


COTTON

Cotton, although a natural product of Venezuela, was not cultivated
until 1782. Its output became important during the Civil War of
the United States, but after that event and the subsequent great
decline in prices of this staple product, the industry was gradually
abandoned. The cotton tree attains the height of a shrub and under
usual cultivation produces in Venezuela more than in the United States.
At the beginning of 1800 the average exportation of cotton was 450,000
kilograms a year. In 1850 the export of cotton was of 300,000 kilograms
and in 1888 of 57,000 kilograms. In 1913, 267,300 kilograms of cotton
with a commercial value of $72,120 were exported.

Cotton grows in nearly the whole territory of Venezuela, but the best
results have been obtained in the States of Aragua and Carabobo, which
produce 54% of the total Venezuelan crop.

The farmers sow cotton when they plant corn or beans during the month
of July and the crop of cotton begins to be gathered at the end of the
month of November or the beginning of December. This depends upon the
time when rains permit the sowing. The crops of corn or beans pay the
expense of the whole cultivation of the cotton and the only outlay
in the raising of cotton is the gathering. It is estimated that the
production of cotton in Venezuela in normal times, excepting droughts,
locusts, etc., amounts to 7,000,000 kilograms in the seed. There is
an average of 28.5% cotton in the seed, therefore, 1,995,000 kilograms
of seeded cotton are produced. The cotton seeds which were sown in the
month of June, 1918, began to give a crop in the month of December of
the same year, and the gathering of said crop ended in the month of
March, 1919. It has been estimated that this crop produced a total of
1,995,000 kilograms of seeded cotton grown in the various states of the
Venezuelan Federal Union.

The price of cotton in Venezuela during the last eight years
(1911-1919) has fluctuated between Bolivars 70 to 150 per 46 kilograms.
The last price of 150 Bs. per 46 kilograms was the one paid at the end
of the 1919 crop, due to the high price of cotton in the United States,
the country producing the greatest amount of cotton in the world.

Since Venezuela produced in 1919 a total of 1,995,000 kilograms of
seeded cotton which were sold at an average of 3.25 Bs. per kilogram,
the total value of the Venezuelan cotton crop amounted to Bs. 6,483,750
($1,296,750 American gold).

Venezuelan cotton is classified as Cotton No. 2. (Egypt produces
cotton No. 1.) Due to the difference in seeds, soil, cultivation on a
small scale, etc., Venezuelan cotton is mixed in such a manner that
a standard quality of uniform length of fibre is not obtainable in a
given lot. For this reason the price of Venezuelan cotton is always
somewhat less than that of the medium class cotton from the United
States.

The State of Zulia produces the best quality of Venezuelan cotton, due
to the length of its fibre and because it is more advantageous when
manufactured, but as the cloth industry in Venezuela is not intensive
enough to warrant the classification of fibres, this advantage is not
noticeable in the aggregate cotton trade of Venezuela. The cotton plant
gives but one crop a year and requires to be replanted every year. At
the present time it is estimated that $200,000 are invested in the
cultivation of this product.


TONKA BEANS

These beans, which are exported from Venezuela on a large scale, have
the shape of a large black almond and give out a delicious perfume.
When dry their peculiar perfume develops still more and it is used as
an odorous basis to make high grade perfumes, and to flavor tobacco.
The bean is a natural product and needs no cultivation, as a general
rule; it is gathered in the Tonka forests existing in the Amazon
territory and the District of Cedeno, in the Venezuelan Guianas. Tonka
beans are a staple of great value in the regions watered by the Orinoco
River and its tributaries, and almost the entire crop of Venezuelan
Tonka beans are exported by the way of Ciudad Bolívar.

The gathering process formerly in use brought about the destruction
of the trees, but the Venezuelan Government has taken the necessary
measures to prevent the trees from being felled as was formerly the
case. The large trees now in existence are being protected perfectly.
In the year 1913 Venezuela exported more than half a million kilograms
of tonka beans having a commercial value of $727,800. One or several
well organized companies with the necessary capital at their command
would derive great profit from such exploitation.[10]

[10] Agricultural Year Book of Venezuela, 1913.


VANILLA

Venezuela produces an uncultivated vanilla plant called "_vanilla
lutescens_," but that commonly known to commerce is the more aromatic
kind called "_vanilla plantifola_." The cultivation of this product has
not been fostered to any great extent. It grows readily in the rich
soil of the States of Falçon, Lara, Bolívar, Anzoatequí and Zamora.
No official figures are available as to the production, cultivation
or export of this product, although there is a good opportunity for
further development.


COCOANUTS

There are many cocoanut tree plantations in Venezuela, chiefly in the
regions of Zulia, Carabobo, Bolívar, Barcelona and Cumaná. Cocoanuts
are used for various reasons abroad and in the United States, therefore
the cultivation of this natural product could be fostered so as to
make it an article of export on a large scale and it would become a
profitable investment not requiring a large capital. In 1913 there were
invested in Venezuela in the cultivation of cocoanut trees $1,095,200.


INDIAN CORN

This product is successfully cultivated in all the States of Venezuela
where it grows in every kind of soil, from the level of the sea to
2,800 meters above it. It thrives best, however, at an altitude of 500
to 1,000 meters. There are about 73,131 acres in Venezuela devoted
to the production of corn, and the total amount raised is estimated
at 150,000 metric tons. Special attention has lately been paid to
the cultivation of corn, which is the real bread-plant in Venezuela,
especially in the interior of the country, and a considerable quantity
of Indian corn has been exported.


BEANS

Beans are also successfully grown in all the States of Venezuela and a
great variety of them are produced. Those having the greatest demand
are the "black beans." Their production not only meets the domestic
demand but they have been lately exported in considerable quantities.
They grow readily at all times of the year and are one of the principal
articles of domestic commerce in Venezuela.


INDIGO

This product was introduced into Venezuela in 1777 and planted near La
Victoria and later in many other places. The best quality was produced
at San Sebastian. Due to the high price attained by coffee many years
ago, the cultivation of indigo was abandoned. In 1902 the exportation
of indigo amounted to 1,876,510 pounds having a value of $2,450,000.

This product has now sufficient demand in foreign markets to warrant
the revival of its cultivation as a remunerative exportable commodity
of Venezuela.

       *       *       *       *       *

During the year 1917-1918 the products exported from the agricultural
zone of Venezuela amounted to $10,400,000; in this zone there is now
invested $46,600,000. A presidential decree of March 12, 1917, created
an experiment station of agriculture, live stock, and forestry with a
garden of acclimatization to be located at Cotiza near Caracas. Its
purposes were stated to be:

The study of improved methods of cultivating the agricultural products
of the country; the introduction, selection and distribution of seeds;
experiments in reforestation; preparation of reports upon nature of
soil and most adaptable crops from each region, with practical work for
the training of agricultural foremen and forest rangers.[11]

[11] Memoria del Ministerio de Fomento, 1918.

Other purposes are:

To maintain circulating agrarian libraries, to promote expositions,
to form nurseries of exotic plants, to introduce new agricultural
machinery and implements, and to supply all possible information and
assistance to the country.

    In the following table the amount of capital invested
    in Venezuela in the cultivation of its eight principal
    agricultural products is shown.[12]

  Coffee trees                                  $16,000,000
  Cacao                                          13,000,000
  Balata and rubber                               2,000,000
  Cocoanut trees                                  2,000,000
  Tobacco                                         2,000,000
  Bananas                                           500,000
  Cotton                                            400,000
  Sugar cane                                     11,500,000
                                               ------------
          Total                                 $47,400,000

[12] Informe del Ministerio de Fomento, 1919, p. 44.

    The following table shows the principal products exported from
    the Agricultural Zone of Venezuela from 1917-1918,--weight in
    Kilograms and values in Bolivares.[13]

    _Products._     _Weight in kilograms._    _Value in Bolivares._

  1. Cotton                     3,067                     4,930
  2. Starch                   248,801                   104,307
  3. Sugar                 13,260,562                 5,526,798
  4. Cacao                 20,280,865                10,603,372
  5. Coffee                34,123,145                29,190,622
  6. Bananas                  377,636                    58,205
  7. Indian Corn           21,360,191                 4,878,173
  8. Brown sugar            5,440,551                 1,427,161
  9. Tobacco                  297,579                   324,436
                          -----------               -----------
          Total            95,392,397             B. 52,118,004

[13] Informe del Ministerio de Fomento, 1919.


THE FOREST ZONE OF VENEZUELA.

This vast region extends from the Gulf of Maracaibo over the mountains
of Yaracuy, San Felipe, Aroa, Tucacas, San Camilo, Guayana and its
territories, and from the untouched forest of the Trujillo and
Barquisimeto mountains to the fertile woodlands of the State of Zamora.

The Forest Zone of Venezuela comprises about half of its territory; of
this half, 98% is still virgin land, a fact which may be regarded as
one of the principal hopes for the progressive future of the country.
The Zone has an area of 795,640 square kilometers, from which over two
thousand specimens were exhibited in Caracas at one time. From this
immense region Venezuela can derive natural resources of unlimited
wealth, when sufficient labor and capital are available, better means
of transportation established, and more modern machinery and implements
introduced.

    The following figures show the division of the Forest Zone of
    Venezuela:

  Public Forest Lands      295,400 sq. kilometers
  [14]Private  "    "      125,000  "   "

    [14] Informe del Ministerio de Fomento, 1919, p. 27.


The Forest Zone of Venezuela comes within the forest area of South
America. Richest in quantity, and, probably in variety of vegetable
life, is the well-known land of Guayana, with its vast forests, hot
climate and heavy rainfall. Within this area the plants range from the
alpine shrubs and reindeer moss found on some of the higher plateaux
and hills to the bamboos and orchids of the river banks. The high
timber trees grow fairly close together, and their spreading tops
fifty, eighty, or one hundred feet from the ground, with the abundant
hanging manes and flowering creepers, keep all but a feeble light from
the ground; hence it comes that the undergrowth is usually sparse or
absent, and progress on foot is comparatively easy.

Of all the forest giants of Guayana, "_Schomburgk_" is considered the
most magnificent; the average diameter of the trunk is about three
feet, and it seldom branches at less than forty feet from the ground.
Its wood, dark red and fine grained, is said to be excellent for
shipbuilding purposes.

_Caoba_, whose wood is very like mahogany in color, and a certain
big tree called "rosewood," which it resembles, are notable among
the timber trees. The huge _Ceibas_ have a soft, easily worked wood,
excellent for the dugout canoes of the Indians. The equally large
_Mucurutu_ or cannon-ball tree furnishes a beautiful but hard grained
timber.

Two fruit trees whose products are well known throughout Europe grow in
the regions of Guayana, the _Brazil nut_ and _tonka bean_ trees.

The gums and resins of Guayana include the balatá, copaiba-balsam, and
rubber-producing trees, the latter chiefly varieties of _hevea_, while
_cinchona_ or _quinine_, with innumerable creepers and trees possessed
of medicinal or toxic properties are found on all sides. There are more
than 2,450 known species of plants to be found in the Forest Zone and
more are being added to the list daily; it is probable that in such an
assembly there must be many of value as yet undiscovered and unused.

The forest plants and trees of Guayana also flourish in the Delta
Region and in the forests bordering the Llanos of Maturin, but the
vegetation of Northern Venezuela is generally different from that of
the South. The great brown plain of the Llanos is beautified by small
golden, white, and pink flowers, while sedges and irises make up much
of the small vegetation. The banks of the rivers often support denser
groves of _ceibas_, _crotons_, _guamos_, etc., and along the banks in
front of the trees are masses of reeds and semi-aquatic grasses.

In the region of the Cordilleras many different types of vegetation
can be found in the various zones. The very hot section has generally
a heavy rainfall and supports thick forests, but along the sea coast
there are barren stretches with only cactus, acacia, croton, and
similar plants. In this region we have the plantations of cacao, sugar,
bananas, plantains, maize and cassava, which are the staple foods
of the inhabitants. The growth of cocoanuts is also encouraged. In
addition, there are many products of the forests, chief of which are
the dyewoods, and tanning barks, including logwood, dividive, mangrove,
indigo, and many others. There is also a great deal of valuable timber
in this region, the chief woods exported being mahogany and cedar.

In the cooler regions we find a mixture of hot country plants and
those of the mountains. One may see in the same valley, within a short
distance of one another, bananas, potatoes, sugar cane, wheat, yuca or
cassava, peas, maize, cotton, cocoa and coffee, all flourishing, and a
single orchard may contain guavas and apples, peaches and oranges, and
a variety of other fruits; the garden adjoining will have a mixture
of roses, carnations, violets and dahlias and many tropical flowers.
Strawberries, mint, nasturtiums and other of our garden plants have
been successfully grown in these mountain regions within 10 degrees of
the equator.

The higher part of this region exhibits a great variety of plants
peculiar to this zone. Along the mountain roads can be seen palms,
screw-pines, and beautiful tree ferns, also cranberries, blackberries,
ivy, quinine-trees, small bamboos, silver-ferns, and many other
beautiful plants and shrubs. In short, here can be seen the greatest
variety of color and floral scenery.

In the cold region of the Cordilleras the small woods of the temperate
zone gradually die out, and toward the snow line we have the alpine
grasses, heaths, and thick leaved, aloe-shaped plants which have lumps
of resin clinging to their roots, and seem to take the place of pines,
which are not found in Venezuela.

The value of the products of the Forest Zone of Venezuela exported
during 1917-1918 was more than $1,800,000. The capital invested in the
cultivation of this zone amounts to more than $2,000,000.

                                                    _Matthew J. Heiler._




THE CATTLE INDUSTRY IN VENEZUELA


    This report is based chiefly on conferences and trips with Dr.
    Martínez Mendoza, Director of the Agricultural Experimental
    Station, and on notes which he very kindly furnished. The
    following references have also been consulted:

    "Venezuela." Handbook prepared by Dr. N. Veloz Goiticoa for the
    Ministerio de Fomento.

    The Annual Reports of the United States Consul at La Guaira,
    for 1916 and 1918.

    "Venezuela" by L. V. Dalton, 1918.

    The article on "Venezuela" in the Encyclopedia Britannica has
    been consulted.

Venezuela has an area of approximately 393,976 square miles and a
population of over 2,848,121.[15] From these figures one may see that
the country is very sparsely settled, and that the first requisite of a
cattle country is met,--that of plenty of open land.

[15] Figures of 1917. Latest census is expected to show some increase.

The main occupation of the people is agriculture. Stock-raising is
next in importance and promises soon to be the leading industry of
the country. Yet, even though the industry is now important, it is
developed to such a slight extent, in view of its possibilities, that
the past history means little and statistics mean but little more.
The wars for independence, internal strife, political unrest and a
certain lassitude on the part of the people have greatly hindered the
development of the industry in the past.

There exist no authentic source material or statistics covering the
cattle industry in Venezuela. Only during the last few years has the
Government succeeded in convincing cattle raisers of the importance of
accurate statistics and led the way itself by beginning systematically
to compile them.

The following statistics are, consequently, approximations and consist
for the most part of rough estimates. They were obtained from the
1919 booklet of N. Veloz Goiticoa and were officially edited by the
"Department of Fomento" and are, consequently, the most nearly correct
and authentic which could be obtained and also the most complete.

Still, as stated before, it is not the past in which we are interested,
so much as the future, and hence we shall merely quote the available
figures and then dismiss them from further consideration.

  _Number of Cattle in Venezuela._
          1804    1,200,000
          1812    4,500,000
          1823      256,000
          1833    2,437,150
          1839    4,617,560
          1847    5,503,000
          1864    5,800,000
          1873    3,302,670
          1883    8,591,860
          1894    6,345,560
          1899    6,059,480

In 1919 it was estimated that there were only 2,600,000 head of horned
cattle within the country.

The figures of 1915-16 for live-stock show:

  Horses        191,000
  Goats       1,700,000
  Sheep         177,000
  Cattle      2,000,000

_Live-Stock on the Hoof Exported From Venezuela from 1831 to 1918._

  1831        1,825
  1847       15,976
  1852       13,316
  1882        5,929
  1898       24,000
  1901       60,000
  1903       60,000
  1904       60,000   _Wt. in Kilograms._  _Value in Dollars._
  1915       18,339        5,415,000             259,800
  1916       18,267        5,115,000             246,000
  1917       18,333        5,195,000             325,000
  1918       19,020        5,343,000             308,000

_Exports of Frozen Meat from 1915 to 1918._

  _Years._  _Carcasses._  _Wt. in Kilograms._  _Value in Dollars._
    1915       17,847        2,197,240             196,663
    1916       18,267        3,315,990             334,216
    1917       18,335        4,978,420             398,273
    1918         --          5,867,770             467,867

In 1917-18 the exports of the "Pastoral Zone" were:

  _Products._                            _Value in Dollars._
  Salted meat                                      3,398
  Frozen meat                                    467,867
  Animal hair                                        100
  Horns                                            1,788
  Skins                                        1,673,230
  Frozen residue of horned cattle                 10,982
  Horses, sheep, goats, pigs                      24,539
  Horned cattle                                  308,188
  Wool                                               155
  Soles                                           67,442
                                             -----------
      Total                                    2,657,689

In 1919 it was estimated that $20,000,000 were invested in
stock-raising and pastures. Since that time there has been a great
increase and it is safe to estimate that now the sum is nearer
$30,000,000.

Topographically Venezuela may be divided into three regions:

1. The mountain area of the north and northwest.

2. The Orinoco Basin, with its spacious "llanos" (plains).

3. The Guiana Highlands.

It is the second region, called "The Pastoral Zone," in which we are
most interested. The other two concern us only in two respects: as a
source of water supply, and as a hindrance to easy transportation.

"The Pastoral Zone" covers 300,000 square kilometers (187,500 square
miles), and extends from East to West, from Barrancas, on the vertex of
the Orinoco delta, to the plains of Sarare on the Colombian frontier;
and from South to North from the Vichada River to the mountains of El
Pao in the State of Carabobo. It includes the states of Portuguesa,
Zamora, Cojedes, Apure, Guárico, Anzoátequi, Monagoas, Bolívar and part
of the other neighboring states.

This entire region is most admirably suited for the raising of cattle.
All year round there is an abundance of green grass and the cattle do
not need much care. Here exists one of the finest natural pastures
of the world, capable of supporting, with the use of modern methods,
50,000,000 head of cattle, twenty-five times the number now existing.

There are two seasons--wet and dry. During the rainy season, from June
to October, the cattle feed in the highlands and mesas, which are not
subject to inundation. From January to May, the dry season, they feed
in the lowlands, which always retain a natural dampness and abundance
of grass.

The climate of this zone is slightly warmer than that of the plains
of Texas, and the dampness of the lowlands results in a much greater
growth of vegetation suitable for cattle.

Throughout this region are scattered the cattle farms of the country,
in most of which the primitive methods of cattle raising are still
followed. The "llaneros," as the inhabitants of the plains are called,
have not yet commenced to utilize the modern methods for breeding
or raising cattle. The cattle run almost wild and considerable loss
results from the lack of proper care. The milk is obtained almost
entirely by the calf, and thus another great source of income is lost.
This accounts for the importation of $400,000 worth of butter annually.

Each year the cattle over three years old are separated from the herd
and slaughtered, although the slaughter of cows is prohibited, and
General Gómez has absolute control over the slaughter of beef for home
consumption. Then, until the next year, the cattle are again allowed to
run wild and at will.

The reason for this apparent carelessness is the regrettable lack of
sufficient labor to care for the herds. This is also the main reason
for loss by disease and drought.

The Orinoco River, 1500 miles long, and 1900 miles long if measured by
its Guaviare branch, lies entirely within Venezuela, and drains this
great cattle section. It has 436 tributaries, and plays an important
part in the transportation of cattle. Here lies the remedy for drought.
No steps have yet been taken for the proper storage of water for
emergency use; with the installation of water storing facilities the
drought loss may be practically eliminated. The screw-worm of the kind
existing on our Texas ranches is here in evidence and loss undoubtedly
results from this source.

Malarial fever at times works havoc in various sections of the
"llanos." Though it may be said that the effects of this disease are
greatly exaggerated it is true that the disregard of the laws of
hygiene is responsible for the wide prevalence of this disease. It is
the supine ignorance of a portion of the half-savage people who inhabit
the plains, which allows the disease to gain dangerous headway. These
people live and eat in primitive fashion, drinking muddy water, eating
badly cooked roots and beef, without salt, sleeping in the open nearly
naked, and consuming at every opportunity huge quantities of coffee
and spiritous liquors (aguardiente), thus becoming predisposed to end
as victims of the dread disease. With the adoption of sanitary methods
to combat the fever, it may be wiped out upon the plains, as is now
happening in some of the better ranches where the workmen observe the
elementary laws of hygiene.

Considering Venezuela's natural advantages and the handsome profits
even now realized under the loose methods of breeding followed, it is
certain that Venezuela is destined to be primarily a cattle country.
"If, notwithstanding the unprogressive methods followed in the breeding
of cattle, and despite the lack of care on the part of the 'llanero' in
the selection of good males, resulting in a large percentage of weak
calves, which, on reaching puberty, give little milk and little beef,
it still appears that breeding is the most profitable industry in the
country, it can well be imagined how the profits will increase when the
Venezuelan breeder puts into full operation the modern improved methods
for breeding, such as the selection and crossing of good breeds, the
introduction of modern methods of sanitation, and the selection and
improvement of the pastures for fattening and the production of milk."
(Director of Experimental Station of Agriculture, Dr. Martínez Mendoza).

Until very recently, a decided lack of adequate transportation
facilities prevented the development of the industry. Death of stock
and loss of healthy condition when transported by the shaky mountain
railways decreased the profits of the cattle raisers. Lately, 1,800
miles of motor roads were built under the direction of General Gómez,
which afford an outlet for the products of the "llanos." Their
construction means the unification of the country and its development.
Probably no one factor has been of such prime importance to the nation
as this great engineering feat.

Still, it must be acknowledged that these roads are not sufficient and
that there is still a lack of transportation facilities. The one saving
factor in the situation is the Orinoco and its branches.

In the past very little attention has been given to the systematic
crossing of breeds. Of late, several prominent cattle raisers, aided
by General Gómez, have begun scientifically to better the breeds of
animals by the importation of fine foreign stock. Thus, the Zebu cattle
has been in the country for some time. This type excels the native
cattle in weight, but is very fierce and wild.

The milk cows are now being selected with great care and good results
are being obtained from crossing them with native stock. Dutch,
English, Swiss, German and American cows are kept in several up-to-date
establishments, where the raisers are beginning to overcome the
difficulties of acclimatizing the foreign breeds, and a high average in
the production of milk is resulting.

At "La Rinconada," an establishment very near Caracas, the pure breed
"Holstein Friesian" is found and the specimens are sold to cattle-men
of the interior, showing a commendable tendency on their part to
improve their stock. I have visited this establishment and may say that
great diligence is exercised in the care of these cattle.

Although the principal income from cattle accrues, of course, from the
slaughter of beef and sale of hides, there is another great source of
income,--the production of "cincho," cheese, for home consumption.
Cattle on the hoof now command a price of Bs. 25 ($5.00) per "arroba"
(25 pounds); the price of cheese is Bs. 600 ($125.00) per 100 kilos.
Because of the recent advances in the prices of cattle and cheese,
the industry has obtained a new impetus as is evinced by the huge
investment of foreign capital (mainly English) during recent years.

The Venezuelan government is doing its best to encourage foreign
capital to invest in the industry. To stimulate production breeding
animals, barbed wire, pumps and well-boring machinery may be imported
at a very low rate of duty.

Immigration is being encouraged by the payment of transportation,
passport, and incidental expenses, and by grants of land. In spite of
this, immigration however is very small, being offset by emigration,
and the high death rate that results from unsanitary conditions keeps
the population figures of the country practically stationary.

There are laws in operation fixing the price and amount of land to
be bought by any one person. One may buy 6,000 acres of first-class
grazing land and 10,250 acres of second-class grazing land at very low
prices. He must improve the land and have at least ten persons on every
250 acres, in the case of land grants, though I have been unable to
ascertain whether this also applies to bought land.

To buy land one first applies, in writing, to the governor of the
state in which the land is situated. If no objection is found to the
sale, a land commission surveys, classifies, and values the land. The
application then goes to the Minister of Fomento, who, if he approves
it, issues a deed, upon payment of purchase price in bonds of National
International Consolidated Debt, or the equivalent at the current
rates. The deed must then be properly recorded.

The government is encouraging the industry by the imposition of very
high protective duties. An example may be found in the boot and shoe
industry which is protected by a tariff, based in 1918 upon gross
weight and, including surtaxes, amounting to $274.10 per 100 pounds.

Of late, more and more impetus has been given to the establishment
of canning, tanning and meat packing plants. Yet, there is only one
packing house in the country. The "Venezuelan Meat and Products
Co., Ltd.," an English company, with a plant at Puerto Cabello, has
practically a monopoly of the exportation of frozen and chilled meats
and of "tasajo" (jerked beef). The capacity is 300 head of cattle per
day and the chief market is Europe. The same company has invested large
sums in choice cattle lands near the site of the factory, and since its
infancy has shown a consistent tendency to steady expansion.

There are two sizable tanneries at Maracaibo which supply the local
demand for coarse leather. Uppers for shoes and finer grades are
imported from the United States. Other smaller tanneries are located at
Caracas, Valencia and La Guaira.

At Barrancas is located a salt-meat plant which is expected shortly to
handle 25,000 head of cattle per year in the production of gelatine,
meat extracts, fertilizer and salt meats. The very high price of salt
in Venezuela is a severe drawback to the salt-meat industry.

Río Chico is a manufacturing town, making soap and candles and passing
the hides to La Guaira for tanning and export.

The Dairy and Canning plant at Maracay is entitled to special mention.
It owes its success to the support given by General Gómez, its largest
stockholder. It is ideally located, being surrounded by some of the
most modern cattle ranches of the country, and has the advantages of
nearby and easily accessible markets. The company also owns its own
cows, and hogs which are supported by the waste and refuse of the
factory.

The building is a specially constructed one, fitted out with a
refrigerating plant and modern machinery of American and German make.
Even the cans used are made within this building. Two kinds of butter
are made here, one with salt and the other without salt. This is the
best butter made in the country. Canned sterilized milk and cream are
also produced, as is also a high grade of cheese. The capacity is 400
pounds of butter and 100 pounds of cheese per day.

Immediately upon entrance to this factory, one is impressed by the
extreme cleanliness and efficiency existing and by the up-to-date
methods used.

Finally, we may consider the advisability of investing capital in
the cattle industry in Venezuela, as there is no question that real
opportunity for profit exists here.

Venezuela is superior to Argentina, the other great cattle country
of South America, in every respect except one, that of the amount
of pasture land. This handicap, however, is not very important
considering that Venezuela is not producing to capacity by _96 per
cent_ and that it will be a very long time before it becomes necessary
to look for means of extending the present feeding grounds. When
that time comes, alfalfa may be planted on the mesas and highlands
not bearing a natural growth of grass. It has been demonstrated that
both alfalfa and elephant grass will grow in almost all sections of
Venezuela.

_Venezuela is a week nearer to Europe than Argentina._ The vast
importance of this fact is self-evident, for it means that Venezuela
will always be called upon up to the limit of her production.

Land is cheap. A square league of meadow land may be had for $80.00.
The best pasture land in a good location may be bought for $800.00 per
square league. Land is abundant too, and but a small percentage is now
in use.

Guanta is a port of the Carribean, in the State of Bermúdez, 12 miles
east of Barcelona, with railroad connections. It has a protected
harbor, with an easy and safe entrance 1998 feet wide, secure anchorage
for large vessels, and a good wharf. Behind Guanto lies fine cattle
land, a significant fact when it is recalled how very important is the
shipment of live cattle.

Here would be an ideal spot for an American packing house, and the
country behind would seem well adapted for the investment of capital in
cattle-raising.

The regions just below Ciudad Bolívar would also be a good location for
an American enterprise. Stock may be very cheaply bought and brought
down the Apure and Orinoco rivers to the plain below the city, where
they could be fattened and slaughtered. There is easy access to the
Carribean and Atlantic, to Trinidad and other markets.

On the other hand, we may say that the future of the cattle industry
depends primarily upon the political situation of the country. It is
this factor which has retarded the industry in the past and which is
now responsible for the hesitancy on the part of foreign capital. The
profit to be derived from any industry here depends upon a firm, stable
government. Under such a government the profits to be derived from
cattle will be immense. If political wars again break out, however,
heavy losses are almost inevitable.

The present administration has done more for the development of the
country than any previous government and its attitude towards foreign
capital is favorable. It has, furthermore, been firm and stable.

Still, beneath it all, one detects signs of a strange unrest. The
observant traveler hears murmurings every day. There is no denying the
fact that the present government is a military one. Yet, I believe that
the intelligent and influential class of the nation realize the good
it has done and feel that the country must never return to the old
conditions of ceaseless revolution. I am of the opinion that Venezuela
has fairly embarked upon a program of development and prosperity.

Another factor to be seriously considered is the aforementioned
shortage of labor. Yet, in spite of this, labor is very cheap. The
government has a favorable attitude toward grants for colonization
purposes, and in this lies a golden opportunity for a resourceful man
with capital to bring his own laborers here and realize great profits
in the venture.

If, upon more detailed examination of the conditions than I have been
able to institute during my limited stay, it is still the desire
of Americans to invest here, such action must be taken soon. The
unprecedented success of the packing plant at Puerto Cabello has
encouraged other Britons to invest. The company itself is acquiring the
best lands about the site of the plant and interested investors are
buying the desirable land in other sections. The American who intends
to invest should do so immediately or he will find that the choice
cattle lands and the best locations for packing houses will be in the
hands of the English. Prompt action is imperative.

                                                    _Willard C. Frazee._

[Illustration: AT THE CENTRAL TACARIGUA, A LARGE SUGAR CANE ESTATE]

[Illustration: DR. SHERWELL AND DR. SÁNCHEZ, DIRECTOR OF THE NATIONAL
LIBRARY WITH GEORGETOWN STUDENTS AT FOOT OF STATUE TO GENERAL RIBAS AND
STUDENT SOLDIERS OF THE WAR FOR INDEPENDENCE]




MINERAL RESOURCES OF VENEZUELA


Before discussing the minerals of Venezuela we shall touch briefly on
some of the predominant features of the topographical formation of
the country, without, however, entering on a detailed description of
the geologic aspects of the rocks and soil. The location of minerals
is directly connected with geologic formations, and the findings of
geologists should be consulted before we can take up the more intimate
study of mineral ores for commercial and industrial purposes.

It has been stated that one of the most ancient land surfaces in the
world is the Guayana Highlands, and from observation made on this
point they may be said to offer many striking analogies to the western
highlands of Scotland, which furnish such frequent opportunities for
exalted poetical allusion in the writings of Robert Burns. The great,
elevated platform, from which rises the peaks and mountain chains of
Guayana appears everywhere to be composed of rock which during the
process of integration and disintegration has preserved traces of a
primitive land of long ages ago when living organisms, if there were
any, had not reached such a stage in their development as to leave
relics in the deposits of the time. The mountains are thought to be
composed of similar rocks, gneisses, hornblendes, schists, and granite,
all containing evidence of great antiquity in point of geologic
time. This Guayana complex, as it is called, has been considered by
geologists as more or less equivalent in age to the Lewisian gneiss of
Scotland and therefore one of the oldest members of the Archaean system.

While in all probability northern Venezuela has no rocks quite as
ancient as those of Guayana, the geological history of this part of
the country has been much more eventful and the number of earthquakes
suggest that even now the form of the earth's crust in this region is
undergoing comparatively violent changes. As is commonly the case, to
find the oldest rocks one must search the hills. The masses of gneiss,
silvery mica, schist, marble, etc., which form the highest part of
much of the mountain region, were first studied by Mr. G. P. Wall in
the Caribbean Hills in 1860 and named by him the _Caribbean Series_.
The silvery mica flakes of this region are sometimes mistaken for the
precious metal and many valueless specimens have been offered for sale
as silver to credulous fortune hunters.

The mineral wealth of Venezuela although not as extensively developed
as conditions would seem to invite, is without doubt of very great
extent, especially in the states of Bolívar and Yuruari. The principal
mineral resources consist of gold, silver, copper, iron, zinc, lead,
quicksilver, asphalt, petroleum, coal, sulphur and precious stones.
There exists hardly any known mineral product that is not found in some
part of the vast territory of Venezuela.


GOLD

The yellow lure that drew the early European venturers to the West is
still one of the principal sources of wealth in Venezuela. Since the
Conquest gold has always been one of the chief attractions offered by
Venezuela to prospectors and capitalists. In 1904 Venezuela occupied
fifth place in the production of gold in the American Republics and it
is acknowledged that the evidence obtained in the various expeditions
in search of this precious metal indicates that gold exists in greater
quantities than statistics tend to show. The greatest output is in
the region of Yuruari, which includes "El Callao." Lack of experience
and carelessness of management on the part of early companies have
led to the shutting down of mine after mine when once the accessible
ore of the vein was exhausted, or lost by faulting. Among the earlier
mines, the Callao was perhaps the most famous, though at all times
the mining industry in this region has been hampered by the cost and
difficulty of transportation, a drawback only to be removed through
the construction by the government either of macadamized roads or
railroads, at the outset preferably the former. There are rich veins in
all the mountainous lands between the Yaracuy River and the cities of
San Felipe, Nirgua, and Barcelona. Near Carúpano large mines are being
exploited by New York capitalists, who have been able to extract seven
ounces per ton out of the ore mined; besides these there are also mines
in the vicinity which contain rich deposits of silver, copper and lead.

The value, in average years, of Venezuelan gold production since 1896
has been:

  1896    $948,500
  1897   1,057,400
  1898   1,089,300
  1899     593,500
  1900     321,200
  1901     321,200
  1902     433,800
  1903     600,000
  1915   1,280,217
  1916   1,479,218
  1917     898,431


COPPER

Copper ores are fairly common in the northern cordilleras, and likewise
in the mines of Aroa in Yaracuy, 112 kilometers from Puerto Cabello.
Here the pyrite veins occur in the Capache Limestone not far from the
point where it has been crossed by a mass of granite. Copper ores are
believed to exist in many other places in the mountains of Venezuela,
especially in the mines of Seborneo and Bailadores. A rich deposit
has recently been opened up near Pao in the northern part of the
state of Cojedes. But the development of metals has been so retarded
during the past year, that the South American Copper Syndicate Ltd.,
one of the principal concerns, has practically suspended operations
and very little production has been realized since March, 1919. The
normal output could not be maintained after the termination of the
European war, which accounts for the disproportion observable between
the years 1918-1919 in the production of gold and copper. In 1919,
653,456.77 grams of gold were mined as against 712,007.08 in 1918. In
1919, 2,090,290 kilograms of copper were produced as against 29,708,195
kilograms in 1918.


IRON

Many signs of hematite and magnetic iron occur in the coast of the
Cordilleras in the mountains above Cora, Barinas, Barcelona, Cumaná
and in many spots in the mountains of Parima; the most valuable ore
is found near the river Imataca, a tributary of the lower Orinoco,
eighty-six kilometers from the mouth. At one point the iron is only 487
meters from the river. There are inexhaustible deposits of magnetic
mineral which give 80% pure metal, easily accessible and presenting
little if any difficulty in transportation. The veins are said to be
numerous and extensive. In 1901 seven hundred tons were shipped to
Baltimore where the ore was examined and described as magnetic with
60-70% of iron content. The main deposit is known as Imatoca, but
there are several other well known deposits in close proximity such
as El Salvador, Nicaragua, La Magdalena, El Encantado, Costa Rica and
Yucatan.

Every natural advantage is afforded in the working and developing of
iron ore deposits in Venezuela. In a metallic mine, value depends more
upon its fertility and less upon its situation.

It is otherwise with coal. The value of a coal mine to a proprietor
frequently depends as much upon its situation as upon its fertility;
hence we may deduce the conclusion that the iron mines of Venezuela
being both fertile and commercially well situated, should have a
compelling interest for foreign capital, especially American capital,
in its search for profitable fields of investment.


COAL

In many parts of the Caribbean Hills, the Segovia Highlands, the Andes
as well as Maracaibo and the Coco Lowlands, deposits of coal exist, but
have only been worked in a perfunctory manner in scattered regions.
The coal mines west of Maracaibo have produced the best specimens,
and seams of a similar nature have been opened near Coco by shallow
workings. The most extensive coal mines are those of Naricual some
fifteen miles east of Barcelona, where the partially explored area has
revealed some hundred deposits of coal of regular formations measuring
from 10 centimeters to 2 meters in thickness.

Coal, however, is not one of the great revenue paying staples, due to
the fact that the mines are located in a country thinly inhabited, and
without good roads or facilities for transportation by water.


SALT

Salt is perhaps the most profitable mineral for the government, due
to the fact that it is a government monopoly. The State allows only
certain specified companies to mine or otherwise obtain this staple.
One of the richest deposits is the salina of Aroga, discovered by Nino
in 1499. An extensive surface of pure sodium chloride is found here,
which yields large annual incomes to the government. Salt is found in
almost all regions of Venezuela as follows:

  _States and Territories_  _Deposits and Mine_
  Zulia                                5
  Falcón                              20
  Carabobo                             5
  Anzoátequi                           7
  Sucre                                4
  Nueva Esparta                       10
  Guayana                              1
  Apure                                1
  Bolívar
  Goagira                              6
  Colón                                5
                                      --
                                      64

The states of Táchira, Trujillo and Mérida use great quantities of
yellow salt, white salt only being consumed in the regions near
the salinas of Zulia. From 1874 to 1904 this commodity yielded
$2,753,761.44 in revenue to the government.

In 1918 the extent of the mining industry was so broad that a special
directory service was suggested by the Minister of Fomento, separate
from the present Union of Mines, Government Lands, Industry and
Commerce. Mining concessions in 1917 included 9 in iron, 14 in gold, 1
in copper and iron, 8 in copper and 1 in mica. In 1918, 9 were granted
in gold, and 5 in iron. The production totalled:

  Gold             958,304 grams
  Copper        42,270,900 kilograms
  Asphalt       54,071,700     "
  Petroleum     18,248,524     "
  Coal          20,164,915     "

EXPORTS IN 1917

        _Companies._       _Metal._   _Quantity._           _Value._
  South American Copper
    Syndicate, Ltd.        Gold          902,510 grams      B. 2,669,599.19
  La Cumaragua Sindicato
    Buria                  Copper     43,701,500 Kilograms
  Nat. Government       }
  So. American Co       }  Asphalt    47,124,000    "
  N. Y. & Bermúdez Co.  }
  Caribbean Petroleum Co.  Petroleum   8,650,700    "

The general mining output of Venezuela in 1918 exhibited the following
characteristics:

    The production of coal was 25,332 tons in 1918 against
    20,165 tons in 1917, all from the two mines operated by
    the government. Considerable improvements were made at the
    Naricual mines, and plans have been formulated involving the
    installation of briquetting machines, and the electrification
    of the mine by means of the falls of the Neveri River as the
    power source. The cost of coal at the pit was 13 bolivares
    ($2.51) per metric ton, and 40 bolivares ($7.72) when delivered
    to private parties.

    Copper production fell from 42,270 tons in 1917 to 29,708
    tons of ore in 1918, probably owing to lack of vessels for
    transportation and the falling off of demand for the metal
    following the cessation of hostilities in Europe.

    Twelve companies were engaged in mining gold, the output being
    958,304 grams in 1916 and 712,007 grams in 1918.

    Only one company produced commercial asphalt (46,453 tons).
    (See Report on Petroleum and Asphalt, p. 102.)

    The number of mining claims of all kinds taken out was 97 in
    1917, 119 in 1918 and 135 in the first three months of 1919.

                                                      _James J. O'Neil._




THE PETROLEUM AND ASPHALT INDUSTRY IN VENEZUELA


    [The writer of this report is much indebted to Mr. W. T. S.
    Doyle, a graduate of Georgetown University, now manager of the
    Caribbean Petroleum Company in Venezuela.]

The purpose of this report is to present a complete, yet concise,
discussion of the petroleum and asphalt situation in Venezuela. The
first part is devoted to petroleum and the second part to asphalt.

Señor N. Veloz Goiticoa, a prominent Venezuelan, says, "There is
scarcely a mining product known that can not be found in some part of
the vast expanse of Venezuela." This statement, intended to apply to
all minerals, is particularly true of petroleum and asphalt in respect
of which the great area of Venezuela has as yet hardly been scratched.


PETROLEUM

Some of the natives of Venezuela knew of the properties of petroleum
as far back as 1856, and used the oil in lamps. Deposits were later
discovered in the interior of the country, particularly near the banks
of the Venezuelan lake of Maracaibo. In the year 1883 the Government
granted the first concession to a local organization, called the
"Compania Petroleo del Táchira," which installed a hand-drilled well in
the state of Táchira; this plant is in operation at the present day,
although old-fashioned methods are being used to obtain the oil from
the ground, consequently the production is negligible. Immediately
after this discovery several concessions were granted to various
interests, but they lapsed because no work was started on them. No
further interest was shown in petroleum until 1893, when a general
mining law was enacted which included provisions for petroleum and
asphalt. This law was in force until 1904 when a new code was enacted,
containing special legislation relating to petroleum and asphalt.
The main provisions were that claims could no longer be taken up by
denouncement proceedings[16] but only under a special contract entered
into with the Federal Executive, the President.

[16] Old Spanish law which provided that a person or party of persons
could stake out any unowned piece of ground, and then establish claim
for it.

In 1905, during Castro's administration, the mining law of 1904 was
remodeled. The act was very short,--containing not more than 13
articles,--but it placed in the hands of the Executive a great deal of
power that he had heretofore not possessed.

All dealings regarding concessions were to be negotiated directly with
him. In the year 1906, pursuant to authority delegated to the Federal
Executive, an Executive decree was formulated which provided for the
whole procedure under which concessions were to be granted. Under this,
important initial steps were taken and many concessions granted. Four
of these concessions are in force to-day; namely:

1. The Colón District (Colón Development Co., Ltd.)

2. The Maracaibo and Bolívar District (Venezuelan Oil Concessions, Ltd.)

3. Buchivacoa District (British Controlled Oilfields, Ltd.)

4. Silva and Zamora District (North Venezuelan Petroleum Co., Ltd.)

Under the new code of 1909-1910, several new contracts were made. A
roving concession was granted to John Allen Tregelles, an Englishman,
to explore the whole northern part of Venezuela. He located and
started to drill a well near Cumaná, but without result. The rest
of his concession lapsed, after a period of two years, through
non-performance. The next important concession under the code of
1909-1910 was granted to the Bermúdez Company which obtained a small
area, not covered by the Tregelles concession; their efforts were
rewarded with more success. The Pauji Company, a local organization,
also obtained a concession for a small area, but their efforts met with
but small success.

On the second of January, 1912, the Caribbean Petroleum Company started
the first solid work in the exploitation of the petroleum fields. They
obtained permission to explore over 1,000 different sections and was
the first company to achieve substantial success. Drilling was begun
in 1914, and three wells in Mene Grande, state of Zulia, and one in
Perija turned out to be successful. In the same year the "Venezuelan
Oil Concessions, Ltd.," a British corporation, drilled a successful
well near Cabimas, and the "Colón Development Company," also a British
concern, struck oil near the Río de Oro.

The law of 1915 showed that the government was exhibiting a tendency to
exert a controlling influence, much more than before, over the various
oil fields. It was found no longer possible to obtain the enormous
concessions that had heretofore been granted.

In 1918 still another new law was enacted. Just about this time greater
interest was being displayed in Venezuelan petroleum, a condition
brought about through the operation of the economic law of supply
and demand. The European War, and the failure of some of the most
important Mexican fields had a great deal to do with the shortage. The
world naturally looked for new petroleum fields, and Venezuela seemed
to be among the most promising prospects. Pursuant to the 1918 law,
an Executive Decree was formulated on October 9, 1918, establishing
the conditions required to explore and exploit petroleum, granting to
prospectors all the necessary facilities, and, in a word, securing for
Venezuela the efficient and profitable exploitation of her valuable
deposits. In pursuance to said decree, the Fomento Department having
passed several resolutions, opened for bids the zones which were free
in the states of Zulia, Táchira, Trujillo, Mérida, Falcón, and Sucre.

In the spring of 1919 sixty-four contracts were made with the
government by various interests, as follows:

1. West India Oil Company (Branch of Standard Oil Company.)

2. The Sun Oil Company, with subsidiaries as follows:

  a. Venezuela Oil Fields, Lt'd.
  b. Venezuelan Sun, Lt'd.
  c. Sucre Oil Fields, Lt'd.
  d. Trujillo Oil Fields, Lt'd.
  e. Merida Oil Fields, Lt'd.

3. Maracaibo Oil Exploitation Company with subsidiaries as follows:

  a. Mara Exploitation Company.
  b. Miranda Exploitation Company.
  c. Perija Exploitation Company.
  d. Paez Exploitation Company.

It will be noted that under both the Sun Oil Company and the Maracaibo
Oil Exploitation Company there are various subsidiaries. The reason
for these combinations are, that under the law of 1918, no one company
or individual may control more than 80,000 hectares of land for
exploration or more than 40,000 for exploitation (1 hectare = 2.471
acres).

In the spring of the year 1920 about 140 concessions were granted under
the law of 1918, and the prospective fields were greatly extended.
Whereas in 1918 they were restricted to the western part of Venezuela,
by 1920 they had been extended to several sections of eastern
Venezuela. In the western part of the country, at the present time, the
whole Maracaibo Basin is covered with concessions, and most of these
are being exploited by American capital.

At the present day there are five companies of importance operating in
Venezuela. The Caribbean Petroleum company, a subsidiary of the General
Asphalt Company, has completed eight wells, all of them producing, the
combined capacity of which is about 6,000 barrels per day, and the
average depth of the wells 1,200 feet. All these wells are located in
Mene Grande, in the state of Zulia, east of the lake of Maracaibo.
This company is now drilling two wells, also in the State of Zulia;
they have already drilled nine dry holes in the State of Zulia, west of
Lake Maracaibo. The Caribbean Petroleum possesses the only refinery in
Venezuela, located at San Lorenzo, on Lake Maracaibo, with a capacity
of about 1,200 barrels per day, intended for local consumption in
Venezuela. A pipe line 10 miles long connects the wells at Mene Grande
with the refinery at San Lorenzo. The large refinery at Curaçao, D.
W. I., completed two years ago, is also refining for the Caribbean
Petroleum Company, the crude oil being transported up Lake Maracaibo,
and through the port of Maracaibo, in barges.

The Colón Development Company, a British Corporation, has completed
four wells, two of 900 feet, one of 1,200 feet, and one of 1,600 feet
and is now drilling a fifth well, all in the District of Colón, state
of Zulia, south and southwest of Lake Maracaibo. Their four wells are
believed to have a capacity of from 400 to 500 barrels a day. The
British Controlled Oil Fields, Ltd., a British Corporation, is drilling
a well in the State of Falcón, 30 miles east of the city of Maracaibo,
and about 10 miles from the Caribbean seacoast. The Maracaibo Oil
Company, an American corporation, organized in the autumn of 1919, has
made four locations, all in the State of Zulia, with the principal
locations in the Parija district. Camps have been established, and
drilling material is arriving at the port of Maracaibo. The Bermúdez
Company, a subsidiary of the General Asphalt Company, has been drilling
for petroleum near Guanoco, for the past 23 months. It is understood
that after drilling 3,600 feet, three-fourths of which was in black
shale, the work was abandoned.

The petroleum now being produced in Venezuela is of an inferior
quality. The wells at Mene Grande, controlled by the Caribbean
Petroleum Company, produce petroleum which has a specific gravity of
960, with a heavy asphalt base, and contains about 15% light material,
and 85% fuel.

The geographical situation of Venezuela makes particularly interesting
the various petroleum enterprises which should contribute considerably
to the economic development and prosperity of the country. Furthermore,
the Panama Canal is not far distant, and vessels that cross through
it,--and they are daily increasing in number,--will be able to utilize
easily the petroleum of the country.

As other industries have suffered, so has the petroleum industry
been seriously handicapped in Venezuela by the lack of adequate
transportation facilities. There are undoubtedly many rich fields of
petroleum in the interior of the country, but it is clear that they are
worthless without adequate means of transporting the product to the
seaports or centers of consumption. The Caribbean Petroleum Company
has had considerable difficulty in transporting its product to Curaçao
from San Lorenzo, a difficulty due to the fact that at the narrow neck
of Lake Maracaibo, there is a bar with only 12 feet of water above it.
It is obviously impossible for ships of any great size to come over
the bar and into the lake. All the petroleum that is shipped from the
Maracaibo district at the present time is handled by shallow-draft
barges, but with sufficient capital, and some good engineering, this
difficulty could undoubtedly be overcome, and it would then be possible
for tank steamers to come into the lake and receive cargoes of crude
petroleum from the various producing points. The principal port in this
section is Maracaibo, in the state of Zulia, and all petroleum for
export is handled through it.

There are numerous opportunities offered for foreign capital in
Venezuela in the exploitation of petroleum. As noted before, the
surface has as yet only been scratched, and indications to-day point
out that there are many possibilities as yet untouched.[17] Geologists
say that there are signs on all sides of the existence of petroleum,
but just where the big producing fields of the future will be located
is difficult to ascertain at the present time.

[17] Senator Lodge, addressing the Senate of the United States on April
13, 1920, declared that what are probably the largest oil fields in the
world are at the point of development in Venezuela and Colombia.

On the 26th of June, 1920, a new law pertaining to petroleum and
asphalt was enacted. A full copy of the act, in Spanish, is presented
with this report. (On file in School of Foreign Service.)

The following table gives the names of the principal petroleum and
asphalt companies operating in Venezuela, with capital invested:

      Names of Companies        Capital in Bolivares  Capital in Dollars
  Caribbean Petroleum Company             20,782,482           4,156,496
  New York and Bermúdez Company
   (asphalt)                               8,914,932           1,782,986
  Colón Development Company, Ltd.          4,747,000             949,400
  Bermúdez Company                         4,319,820             863,964
  Venezuelan Oil Concessions, Ltd.         2,316,996             463,399
  British Controlled Oilfields, Ltd.       1,500,000             300,000
                                         -----------          ----------
            Total                     Bs. 42,581,230          $8,516,245

There are in addition several small local companies operating in
Venezuela; these together with the above companies represent probably
a total investment of Bs. 50,000,000 ($10,000,000) in petroleum and
asphalt.

It will be interesting to note at this point that during the year 1919
over Bs. 2,000,000 were paid to the Venezuelan Government by North
American corporations for the right to exploit concessions.

The following table shows amounts (in metric tons) of petroleum
exploited and exported during the last three years:

                    _1917_    _1918_    _1919_    _Totals_
  Exploited         18,248    24,153    22,957     65,358
  Exported           8,650    11,101     1,084     20,835

It will be noted that production and exportation greatly increased
in 1918 over 1917. In 1919, production was decreased and exportation
greatly decreased in proportion to exportation of 1918. In 1918, almost
half of the production was exported while in 1919 the amount exported
was about one-twenty-second part of the amount produced. This was
due to the fact that a greater amount was being consumed locally in
Venezuela.


ASPHALT

The age of asphalt is at hand. This important mineral already has
many applications in our lives, and with a greater knowledge of its
possibilities, its utility will be largely extended. Asphalt is very
old. It was the material that welded together the stones of the Tower
of Babel; it was found on the shores of the Red Sea, and the Egyptians
used it in the preservation of their dead. The etymology of the word
asphalt ("α" privitive and σφαλλω, to slip) indicates its cementatory
properties, and the actual ingredients of the substance are common
scientific knowledge. Asphalt, asphaltum, bitumen, maltha or mineral
pitchmene,--different names for the same substance,--is an amorphous,
pitch-like material, black or brownish in color, and lustrous, being
composed of various hydrocarbons, whose proportions vary widely
according to the locality from which the material is obtained. It is
a product of the decay of vegetable matter, and commonly,--perhaps
always,--occurs in connection with rocks containing bituminous matter.
It melts at a heat of from 195 degrees to 212 degrees Fahrenheit, and
burns with a bright, smoky flame. While the pitch-lake of Trinidad,
a surface a mile and a half across of pure asphaltum, is perhaps the
most remarkable occurrence of this mineral in nature, still the lake of
Bermúdez, which covers 1,000 acres in the state of Sucre, Venezuela,
is fast equaling the former in commercial importance. Asphalt is also
found in the Pedernales district, in the state of Monagas, as well
as on the shores of Lake Maracaibo. As an indication of the value of
Venezuelan bitumen, we may cite the fact that this special variety is
used to protect the tunnels of the New York subway from moisture.

The fact that Venezuela has sent 43,000 tons of asphalt to the United
States in one year, is an indication of the future wealth to be derived
from the systematic exploitation of asphaltum there.

At the present writing there is but one company producing asphalt,--The
New York and Bermúdez Company, a subsidiary of the General Asphalt
Trust. This company is working a pitch lake at a point near Guanoco,
in the state of Sucre, adjacent to the Gulf of Paria, in the extreme
northeastern part of Venezuela. The concession held by this company is
known as the Hamilton Concession,--obtained in 1886 for a duration of
99 years, and including about 960 hectares. The grade of asphalt is
excellent, and in many respects better than the Trinidad variety, as it
tests at a grade of 98% asphalt and 2% water and waste. The pitch lake
is only 7 miles from the Rio San Juan and the company is particularly
fortunate because the deep water in the river permits ocean steamers
to come alongside the company's docks. A railroad, controlled by
the New York and Bermúdez Company, is in operation between the lake
and the docks, and over this all asphalt produced in this region is
transported. The transportation situation here may be contrasted
with that in the Maracaibo district in western Venezuela, where
transportation conditions are none too good.

The South American Asphalt company of Philadelphia has obtained an
asphalt concession in the vicinity of Mene Grande, near the eastern
shore of Lake Maracaibo, but as yet no results have been obtained.

The following table shows the capital of the New York and Bermúdez
Company, and the amount of asphalt exploited and exported for the last
three years:

  Capital of New York and Bermúdez Company, Bs. 8,914,932 ($1,782,986
        American gold). _Figures in metric tons._

                       _1917_    _1918_    _1919_    _Totals_
  Exploited            54,071    46,453    45,936     146,460
  Exported             47,124    43,347    42,459     132,930

Official Trade Statistics of Finance Department for 1918-1919 show
that during budget year, Venezuela exported more than Bs. 1,000,000
($200,000 American gold) worth of asphalt.

The law of June 26, 1920, referred to in the last part of section one
of this report, applies likewise to asphalt. The photographs attached
show several phases of the petroleum industry in Venezuela and the
accompanying map shows in a general way the petroleum and asphalt
concessions and the areas of production.

                                                   _William H. Johnson._




CHECKS, DRAFTS, BILLS OF EXCHANGE AND TRADE ACCEPTANCES IN
VENEZUELA.[18]


    "In the primitive ages of commerce, article was exchanged for
    article without the use of money or credit. This was simple
    barter. As civilization progressed, a symbol of property--a
    common measure of value--was introduced to facilitate the
    exchange of property. This might be iron or any other article
    fixed by law or by consent, but it has generally been gold
    or silver. This certainly is a great advance beyond simple
    barter, but no greater than has been gained in modern times by
    proceeding from the use of money to the use of credit.

    [18] In the discussion of commercial paper in Venezuela, it will be
noticed that very few statistics are presented. It was found by the
writer that very few articles had been written on this subject and
those available were lacking in statistics. The Chamber of Commerce,
however, interested itself in the topic under consideration and as a
result statistics are to be compiled for the year 1920.

    "Commercial credit is a creation of modern times and belongs in
    its highest perfection only to the most enlightened and best
    governed nations.

    "Credit is the vital air of the system of modern commerce. It
    has done more--a thousand times more--to enrich nations than
    all the mines in the world. It has excited labor, stimulated
    manufacturers, pushed commerce over every sea, and brought
    every nation, every kingdom and every small tribe among the
    races of men to be known to all the rest.

    "All bills of exchange, all notes running upon time as well as
    the paper circulation of the banks, belong to the system of
    commercial credit. They are parts of the one great whole. We
    should protect this system with increasing watchfulness, taking
    care, on the one hand, to give it full and fair play and, on
    the other, to guard it against dangerous excesses."

    (Speech of Daniel Webster in U. S. Senate, March 18, 1834.)

These weighty words uttered by the great Webster, more than four-score
years ago, indicate the importance of the functions of commercial
credit, the red blood which flows through the veins of commerce. It
is of vital importance, therefore, when studying the commerce and
conditions of a country to consider, as we are about to do, the credit
system.


CHECKS

The system used in Venezuela is the same universal check system common
to the United States and European countries. Money is deposited in the
usual manner on a checking account, in return for which bank credit
is received, and the depositor thereafter has the right to direct the
bank to pay to the order of a specified person any part of the capital
therein deposited.

In regard to the period of time during which this method of payment
has been employed in Venezuela it is difficult to secure definite
information, although local bankers say that its history is very short.
The period of real use is not longer than the last decade.

Considering the proportion of checks devoted to financing commerce, it
is necessary to divide the latter into two main parts. First: commerce
with the interior of the country, in the life of which checks are
practically unknown, all payments being made in gold or silver. Second:
transactions of the wholesale merchants and the larger retail dealers
of important cities, who make ready use of this efficient and easy
method of payment.

Although no statistics have ever been collected showing the amount of
checks used in Venezuela, the following reliable data was obtained:

An estimate was made in 1920 by the National City Bank of New York
City, _sucursal_ of Caracas, showing that about 75 per cent of the
business handled by them was done through the medium of checks. It may
be well to note at this point that this bank handles the business of
American firms in that city together with other foreign companies who
have dealings with the United States. Another estimate made by the Bank
of Venezuela, taking the month of January, 1920 as an average, showed
that about 50 per cent of the business transactions passing through
their hands for that month was similarly completed. It may be observed
that this bank is the largest and best recognized national bank in
Venezuela.

From these two estimates we may draw the conclusion that the foreign
branch banks handle more checks than the old established native banks
of the country, due to the fact that foreign firms in Venezuela use a
greater amount of checks than the native dealers. But since business
with the interior of the country comprises about one-half the commerce
of Venezuela, we should divide our estimates and conclude that between
25% and 37%, (31% mean average) is the proportion of checks used in the
commerce of Venezuela.

The system of clearing these checks is the same as was formerly the
custom of the United States, before the days of the clearing house.
The banks of the interior are all branches of the four main banks
of Venezuela. They handle very few checks but when occasion arises
send them to the main offices for final settlement. Each day the
banks gather their checks together and send them by messenger to the
respective institutions on which they are drawn. In this manner the
clearing takes place, currency being exchanged to settle balances.
The size of the country and the proportion of checks used does not
necessitate a clearing house.


LAWS REGARDING COMMERCIAL PAPER

Article No. 2 of the National Stamp Tax Law, drawn up by the Congress
of the United States of Venezuela in conference assembled in the year
1915 decrees:

"Will be subject to a national tax of stamps, all documents or writings
which relate to things, services, laws or legal proceedings, whose
value is estimated or determined, that circulate within the interior of
the Republic, or that are expedited for foreign use."

"This tax will be collected with the following tariff:

  Bs.  25  to    50    Bs.  0.05
   "   51  "    100     "   0.10
   "  101  "    200     "   0.20
   "  201  "    300     "   0.30
   "  301  "    400     "   0.40
   "  401  "    500     "   0.50
   "  501  "  1,000     "   1.00"


DRAFTS AND BILLS OF EXCHANGE

Drafts and Bills of Exchange used in Venezuela may be classified and
considered with reference to the following headings: International
Trade and Domestic Trade.

We shall first consider the drafts used in foreign exchange. In most
countries they may be classified as "clean bills" of exchange, and
"documentary bills," _i.e._ those accompanied by bills of lading (full
sets), invoice copy and insurance certificates. But this is not so
in Venezuela, as according to the Banking Law of 1919 all drafts on
Venezuela, in order to be collectible must have documentary evidence
attached. At the termination of the late war many anxious dealers in
North America shipped goods to Venezuelan firms, as a rule forwarding
a draft to a local consul or bank for collection, only to find that
it was useless without documents attached. Hence, if the merchant to
whom the goods were sent chose to be dishonest, he might obtain the
goods from the docks and sell them, and not be held responsible by law.
Although this has very seldom occurred, it is always a wise measure for
the drawer of a draft on Venezuela to acquaint himself with the banking
laws of that country.

Another noticeable matter of considerable importance is the difference
between the drafts drawn on Venezuelan merchants by American houses
and those drawn by European houses. It is a commonly understood and
most regrettable fact that the time on drafts from the United States
do not exceed ninety days, while those from European countries,
especially England, will bear six months' time. This fact was brought
to the attention of the writer by the Chamber of Commerce and by every
representative of banks, both American and Venezuelan, with whom he
consulted. The Republic has expressed its desire to maintain and
increase the present trade with North America but it demands the same
credit from Americans as is granted by European merchants. To-day we
live in an age of credit, and Venezuela must have that credit in order
to develop her commerce.

From the law quoted herein it will be seen that all drafts on Venezuela
are subject to a graduated stamp tax ranging from .05 bolivares for
drafts valued at 25 to 50 bolivares up to one bolivar for drafts valued
at from 500 to 1,000 bolivares.

Foreign drafts in Venezuela are always drawn in duplicate (first of
exchange and second of exchange), each being forwarded by different
steamers to insure safety, one becoming void when the other has been
paid. Drafts may be drawn to the order of a specific payee, usually the
collecting bank, or they may be drawn to the order of the drawers or
shippers.

The discounting of drafts and other bills of exchange has developed
greatly within the last two years. Commercial liquidation has been
made possible by the buying and selling of drafts in all parts of the
country at the same price. Funds have been transmitted by telegraph
to places where the sending of specie would be extremely costly.
Commissions range from ¼% of 1% to 1.

Recently there has been established by private enterprise that type of
bills of exchange bearing 8% annual interest, or one per cent less than
the current interest, at which wholesale dealers discount the invoices
of their sales in the interior. This important branch of banking has
been in operation for about two years and it has been noticed that
the system, in spite of the short time in existence, has gained firm
foothold and been generally adopted. The operations which have been
carried on by the Bank of Venezuela in this branch show the following
results:[19]

  _Year_  _Semester_         _Amount_

   1917       2      Bs.   368,430.53
   1918       1            752,118.52
   1918       2            967,516.32
   1919       1          1,243,576.79

[19] Report of Inter American High Commission, 1919

As may be seen from these figures the results have been satisfactory,
and the system has also produced still greater results in the
development of the commerce of the Republic.

As is natural, the foreign banks recently founded, have also discounted
these acceptances of commerce and it is hoped that with their great
influence and the cooperation of the banks of Venezuela, this method
will continue to grow in use.

The handling of drafts is at the present day perhaps the most important
dealing in commercial paper observable in the banks of the country.


TRADE ACCEPTANCES

As expressed in the circular of Feb. 8, 1915, it is the opinion of the
Federal Reserve Board that: "the acceptance is still in its infancy in
the field of American banking. How rapid its development will be can
not be foretold but the development itself is certain."

The Federal Reserve Board in its circular of July 15, 1915, defines
the term "trade acceptance": "A bill of exchange--drawn to order,
having a definite maturity and payable in dollars in the United States,
the obligation to pay which has been accepted by an acknowledgment,
written or stamped, and signed, across the face of the instrument,
by the company or firm, corporation or person upon whom it is drawn;
such agreement to be to the effect that the acceptor will pay at
maturity, according to its tenor, such draft or bill without qualifying
conditions." An acceptance, therefore, may rightly be called a time
bill of exchange which passes from hand to hand like money.

This acceptance differs from what is commonly termed such in Venezuela
and also from drafts. The commercial document with bill of lading
attached commonly called an acceptance in that country, may be drawn
at sight, or may be made payable at a certain time after sight. This
enables the title of the goods covered by the bill of lading to remain
vested in the seller, the drawer of the draft, or the person to whom
the bill of lading may be endorsed, until the draft is paid. Another
form not in common use in Venezuela is the sight draft for collection,
which is drawn on buyers previously sold on open account. It is
generally used as a means of collection when ordinary means have failed
to produce payment. The "trade acceptance," on the other hand, is an
acknowledgment of obligation and a promise to pay it on a certain date.

Some objection has been made to trade acceptances in this country on
the ground that the bidding of the banks in the market of discount,
would deprive commercial houses of selling their own single-name paper.
It has been proved, however, that the sale of the aforesaid paper has
in no way been disturbed by the introduction of acceptances. All banks
worthy of consideration have as a rule surplus capital to invest and
this is usually attracted by the commercial paper of responsible houses.

The use of trade acceptances, therefore, not only does not impede but
tends to increase the banking facilities of merchants.

This most important of all commercial papers has yet to be adopted in
Venezuela. The first acceptances cashed in that country were handled
by the local branch of the National City Bank of New York. These
acceptances--twenty in number--were cashed during the last week of
July, 1920. The foundation has thus been laid and it is expected that
their use will grow in such numbers that they will eventually surpass
all other instruments of commercial credit employed in the country.

The present need of the Venezuelan public, of the bankers and of the
nation as a whole is the development of the great natural resources of
the land. This, obviously, is an enormous undertaking and requires from
all the nations with whom Venezuela has business dealings, especially
from the United States, _credit_. And by what means can that credit be
more satisfactorily granted than in that form wherein each party reaps
a real benefit, by the instrument known as "trade acceptance"?

                                                       _Nelson Hopkins._




COMMERCIAL TRAVELERS IN VENEZUELA


The importance of commercial travelers not only as representatives of
business concerns, but also as types of a given nationality, has at
last been realized and they are being treated as important factors
not to be overlooked by corporations or the nation in the formulation
of trade policies. They are the spokesmen of their countries and from
their lips and by their actions a nation is sometimes judged not only
from a business but also from a political standpoint.

The importance of this factor was realized but by few nations before
the war, and the nations fortunate enough to appreciate their
importance readily provided means for improving their service. The
United States of Venezuela and the United States of America were among
the nations which had been slow to realize the benefits that could
be reaped from commercial travelers for their respective countries.
However, once they had realized the necessity, Venezuela and the United
States signed a treaty, effective July 3, 1920, which greatly benefited
the travelers of all countries and also testified to the influence of
their service.

The convention also impressed upon the business houses in both
countries, and demonstrated the fact, that commercial travelers are
the criterion by which concerns and countries are judged in foreign
countries. Representation in overseas commerce requires men of skill
and character and without these two qualities no traveler can ever
succeed.

Venezuela is one of the best fields in South America for commercial
travelers, as the nation is very rich and has a high standing in the
financial world. The natural resources are innumerable and rich, as
can be readily realized from the number of countries competing for
investments and monopolies at the present time. The large amount of
money in circulation and the importance of Venezuelan markets in the
export trade has encouraged export houses throughout the world to send
representatives to study conditions and eventually place their products
in that market.

In order for commercial travelers to rightfully represent their
principals they must be fully acquainted with climatic, political and
legal conditions in Venezuela. The legal requirements for commercial
travelers are few and by far less stringent than the laws of other
Latin-American countries. Commercial travelers coming to Venezuela are
not required by law to present any document other than their passports.
No power of attorney is necessary, but it is advisable to have it in
case it should be required in business transactions. A letter from the
home office of the traveler or from some well established exporting
or importing house is not necessary but advisable as a medium of
introduction to the prospective buyers.

The recent convention signed between the United States of Venezuela
and the United States of America has slightly changed previous
customs. The object of the convention was that both countries might
encourage commercial relations and increase business by facilitating
the activities of commercial travelers. The convention provided for a
license in both countries but as yet that provision of the convention
has not been complied with and the prospects are that the old custom
requiring no licenses will remain in effect.

There are no baggage restrictions, but, as the means of travel are
limited in some parts of the country, it is advisable that the traveler
confine his baggage to as small a trunk as possible.

In customs treatment of samples it is necessary to follow the
provisions of the recent convention:

    1. All samples which have no commercial value shall be admitted
    free of duty.

    2. All samples shall be considered without value when they are
    stamped or rendered unusable.

    3. Merchandise having commercial value shall be admitted
    provisionally, security having first been given for the customs
    duties and with the understanding that they leave the county
    within a period of six months.

    4. Duties shall be paid on that part which shall not be
    exported.

Means have been provided at all principal ports in Venezuela for the
immediate clearance of samples so as not to delay the commercial
travelers. Samples usually receive consideration immediately after
personal baggage and in some cases they are first.

In connection with advertising matter it is interesting to note that
catalogues are admitted free; but the term is strictly construed.
Pamphlets and advertising matter in general, including calendars, are
dutiable at $1.37 per hundred pounds gross weight. Advertising matter
with lithographed or printed designs not bearing the name and legend of
the advertiser is dutiable at $17.13 per hundred pounds gross weight.

Practically all exporting countries are transacting business with
Venezuela at the present time. America ranks first with Spain and
England second and third respectively. Competition is keen, due to the
fluctuation of the foreign exchange and the manufacture of goods. The
American commercial travelers are excellent salesmen and thoroughly
understand their products. The appearances, personalities and ways of
the Americans are very popular in Venezuela, but the English and German
travelers are very efficient and have considerable influence.

Before a commercial traveler can successfully sell goods in Venezuela
he must understand Spanish. It is necessary to know not only the words
but also the construction of the language. Many commercial travelers
have failed in their attempts to sell goods due to the fact that they
possessed only slight knowledge of the language, which is not alone
a fault of the travelers but also of the houses they represent. The
German nation was the first to realize that the knowledge of Spanish
was indispensable to commercial travelers; knowing that this essential
was the basis of business success in South America, the various German
concerns prior to the war established schools where they instructed
their agents in the language and customs of the countries to which they
were to be sent. Offices were opened in the principal cities of various
countries and agents sent to them where they remained for fully a year
learning the business customs and language, and after mastering both
they were given positions as commercial travelers. Consequently the
Germans successfully entrenched themselves in numerous countries and
were enabled to compete with every advantage in export trade. But many
American travelers have neglected to learn Spanish, preferring to talk
their own language whenever possible.

The national customs of Venezuela are naturally different from those
of the United States and other countries. Business customs, too, are
different and so are the customs of the home. It is easy to become
used to them and one _must_ know them in order to transact business.
In some parts of the country business would seem to be a secondary
consideration, social life ranking first, which of course is contrary
to the habits of thought in the United States and many European
countries.

It is advisable, too, that we consider the variations in climatic
conditions in Venezuela and the effect of such conditions on the
demand for goods in general. In order intelligently to understand the
situation it will be necessary to know the climatic features of each
important city.

Caracas, the capital of Venezuela, has a splendid climate, invigorating
and refreshing, somewhat similar to that of Los Angeles, California.
The days are rather cool with the exception of mid-day which, of
course, is very warm. Light-weight clothing is worn during the day
while at night medium-weight clothing is preferable. As Caracas is the
capital, there is a steady demand there for fashionable clothing. Aside
from clothing, many other products are in demand such as drygoods,
machinery of all descriptions, autos, hardware, etc. The same products
are generally needed in all other cities. The intensity of the heat
in Valencia, Maracaibo, Maracay and Ciudad Bolívar allows only
light-weight clothing to be worn.

Commercial travelers should acquaint themselves with conditions in
all cities and must carefully study the demands for their products.
The market for machinery is greater in Caracas than any other city in
Venezuela. The demand for farming implements is greater in Valencia
than elsewhere. Mining machinery is needed in Maracaibo and surrounding
cities where the various mines are located. Dry goods are in demand
throughout the country districts. Regardless of the size of the city
one can find American goods everywhere. The quality of the goods
outranks that of other countries and, moreover, there is a strong
feeling of friendship on the part of the Venezuelans in favor of
America and American goods.

One of the frequent complaints uttered to American commercial travelers
is directed against American methods of packing goods for shipment.
During the last two years the majority of American exporting houses
sending goods to South America have neglected proper packing with the
result that the goods are often received in woefully poor condition.
Although a small item, it is of prime importance from the standpoint of
the importer and a hindrance to the success of commercial travelers.

We have enumerated the legal requirements and personal duties of
commercial travelers and have also mentioned the market. It will be
helpful to point out the means of transportation and communication
in Venezuela. Companies that have never sent commercial travelers to
Venezuela have a wrong impression as to the means of communication and
transportation. The roads are excellent and in some cases surpass those
in the United States and other countries. The railroads, although not
as modern as the roads in the United States or Europe, are well capable
of carrying passengers and freight up and down the high mountains.
In some cases in Venezuela, a train will ascend from sea level to an
altitude of 12,000 feet. There is herewith submitted a complete list of
the railroads, showing destinations and number of stations. There is
also attached a complete list of the roads showing distances between
principal cities en route, the outline further showing the altitude of
each city.

[Railroad facilities may be found enumerated on pp. 69-70.]

The following list of the roads and highways in Venezuela show the
distances between cities and the altitudes of the respective highways:

                   HIGHWAY FROM CARACAS TO VALENCIA

                        _Distance_ (_Kilometers_)  _Altitude_ (_Meters_)

  Caracas (Plaza Bolívar)                0                920.00
  Antimano                            9.30                937.00
  Los Adjuntas                       14.10                970.00
  Les Teques                         24.30              1,168.00
  Los Teques (Llano de Miquilen)     25.30              1,172.00
  Guayas                             44.30                470.00
  Las Tejerias                       46.80                500.00
  El Consejo                         57.50                576.00
  La Victoria                        65.60                576.00
  San Mateo                          75.20                479.00
  Turmero                            83.70                564.00
  Maracay                            97.90                450.00
  San Joaquin                       113.70                440.00
  Guacara                           122.80                430.00
  Los Guayos                        141.30                440.00
  Valencia                          148.80                470.00

                   HIGHWAY FROM CARACAS TO LA GUAIRA

  Caracas (Plaza Bolívar)                0                920.00
  Agua Salud                          2.50                935.00
  Catia                               4.00                960.00
  Blanden                             7.15                839.00
  Cantinas                            9.23                871.00
  Pauji                              15.20              1,004.00
  Las Trincheras                     16.26                941.00
  El Copey                           19.70                770.00
  Civucutti                          26.38                475.00
  Manonga                            29.38                215.00
  Marquetia                          32.38                 40.00
  La Guaira                          34.78                  8.00

                    HIGHWAY FROM CARACAS TO GUATIRO

  Caracas (Plaza Bolívar)                0                920.00
  Quebrada Honda                      3.15                880.00
  Sabana Grande                       4.15                870.00
  Chacaito                            4.90                860.00
  Los Ravelos                         5.90                870.00
  Chacao                              6.90                880.00
  Los Dos Caminos                     9.25                860.00
  Petare (Plaza)                     12.50                840.00
  La Cortada del Respiro             18.00                960.00
  Quintana                           23.00                761.00
  Caucaquita                         25.00                690.00
  El Agaucate                        26.50                641.00
  Ochoa                              29.80                563.00
  Mampete                            35.00                489.00
  El Cercado                         38.50                443.00
  El Tamarindo                       39.70                425.00
  Guarenas                           45.35                396.00
  Guatire                            52.35                335.00

                HIGHWAY FROM CARACAS TO OCUMARE DEL TUY

  Caracas (Plaza Bolívar)                0                920.00
  Puento de Hierro sobre el Guairel   1.75                879.00
  El Valle (Plaza)                    5.35                889.00
  Coche                               8.55                901.00
  Bermúdez                           10.25                920.00
  Gato Amarillo                      11.65                908.00
  Bejarno                            14.15
  Prim                               16.75              1,005.00
  Cortado del Guayabo                18.15              1,150.00
  Maitana                            24.65              1,229.00
  Maturin                            36.50                669.0
  Buena Vista                        38.20                736.00
  Charallave                         41.50                692.00
  Cantarrana                         52.00                307.00
  Vallecito                          61.50                210.00
  Ocumare del Tuy                    70.20                210.00

              HIGHWAY FROM MARACAY TO OCUMARE DE LA COSTA

  Maracay (Alcabala)                     0                425.00
  El Diamente                        22.30                431.00
  El Limon                            5.30                453.00
  La Quesera                          6.00                460.00
  Guamitas                           14.00                720.00
  Guacamauyas                        17.40                871.00
  Piedra de Tranca                   22.00              1,045.00
  Rancho Grande                      23.00              1,085.00
  El Portachuelo                     24.00              1,120.00
  Periquito                          30.00                845.00
  El Salto                           34.00                660.00
  Tio Julian                         39.00                405.00
  La Tulla                           44.30                143.00
  Cansa Macho                        45.00                123.00
  Aponto                             47.00                 88.00
  Pueblo Nuevo                       52.60                 40.00
  Ocumare de la Costa                53.30                 30.00
  Caserio de la Boca                 57.90                  3.00
  Puerto de Ocumare de la Costa      58.70                  2.00

           HIGHWAY FROM LLANO CAGUA TO SAN FERNANDO DE APURE

  Cagua                                  0                472.00
  Ciudad de Cura                     20.00                556.00
  San Juan de los Morros             45.00
  Uverito                            76.00
  Parpara                            83.00                556.00
  Ortiz                              94.00
  Los Dos Caminos                   100.00
  Morrocoyes                        120.00
  El Rastro                         153.00
  Calabozo                          175.00
  San Fernando Apure                334.00                 73.00

                HIGHWAY FROM VALENCIA TO PUERTO CABELLO

  Valencia (Plaza Bolívar)               0                470.00
  Camoruco                            1.00                478.00
  Mayuanagua                          7.80                490.00
  El Retobo                           9.80
  Barbula                            12.30
  La Entrado                         15.30                595.00
  Las Trincheras                     20.80                360.00
  El Cambur                          30.80                 70.00
  Taborda                            40.30
  El Palito                          42.30                  3.00
  Puerto Cabello (Plaza)             53.60                  1.00

                    HIGHWAY FROM VALENCIA TO NIRGUA

  Valencia (Plaza Bolívar)               0                470.00
  Bejuma                             52.25                662.00
  Miranda                            69.50                625.00
  Salorn                             85.25                768.00
  Nirgua                            100.50                793.00

                  HIGHWAY FROM VALENCIA TO SAN CARLOS

  Valencia (Plaza Bolívar)               0                470.00
  Tocuyito                           17.00                450.00
  Tinaquello                         50.00                423.00
  El Tinaco                          78.75                143.00
  San Carlos                         98.75                150.00

           HIGHWAY CENTRAL FROM THE TÁCHIRA TO SAN CRISTOBAL

  Estacion Táchira del Gran              0                370.60
  Colón                              18.00                800.00
  Angostura del Lobaterita           27.30                815.00
  Galtineros                         34.56              1,150.00
  Putachulo de la Paja               38.58              1,257.00
  Palo Grande                        55.20              1,525.00
  San Cristobal                      76.20                825.00

          HIGHWAY FROM CUMANÁ TO CUMANACOA (IN CONSTRUCTION)

  Cumaná                                 0                 16.00
  Puerto de la Madera                 7.00                 45.00
  Los Ipures                         12.00                105.00
  Mochima                            20.00                121.00
  Cedeno                             36.00                166.00
  San Fernando                       48.00                212.00
  Rio Arenas                         52.00                215.00
  Cumanacoa                          56.00                230.00

                HIGHWAY FROM BARQUISIMETO TO EL TOCUIYO

  Barquisimeto                           0                556.00
  Quibor                             39.00                720.00
  El Tocuiyo                         69.00                617.00

                    HIGHWAY FROM EL PAO TO BARINAS

  El Pao                                 0                160.00
  San Carlos                         57.12                150.00
  Acarigua                          133.12                186.00
  Ospino                            179.74                184.00
  Guarne                            230.75                183.00
  Barinas                           318.15                180.00

                HIGHWAY FROM CHARALLAVE TO SAN CASIMIRO

  Charallave                             0                307.00
  Cua                                13.00                240.00
  San Casimiro                       39.50

            HIGHWAY FROM SAN FERNANDO DE APURE TO SAN JUAN

  San Fernando                           0                730.00
  Achaguas                           78.12                 83.00
  San Juan                          141.25

                   HIGHWAY FROM SAN FELIX TO TURMERO

  San Felix                              0                 20.00
  Apata                              57.50                293.00
  Guasipato                         160.00
  Turmero                           220.00

                     HIGHWAY FROM CORO TO CUMAREBO

  Coro                                   0              1,798.00
  La Vela                             5.00                120.00
  Cumarebo                           43.00                 13.00

                  HIGHWAY FROM BARQUISIMETO TO CARORA

  Barquisimeto                           0                566.00
  Banco de Baragua                   45.00
  Rio Tocuyo                         86.00
  Carora                            116.00                409.90

                   HIGHWAY FROM TURJILLO TO MOTATAN

  Turjillo                               0                800.00
  La Plazuela                         4.00                592.00
  Pampanito                          14.00                385.00
  Motatan                            36.00                324.00

                   HIGHWAY FROM BARCELONA TO SOLEDAD

  Barcelona                              0                 13.00
  Cuataquiche                        29.60
  San Mates                          57.60                153.00
  Aragua de Barcelona               102.40                110.00
  La Canoa                          285.00
  Mouchal                           308.60
  Campo a Legra                     332.00
  Soledad                           359.30

              HIGHWAY FROM LAS ADJUNTAS TO COLONIA TOVAR

  Las Adjuntas                           0                970.00
  Macarao                             3.00              1,000.00
  Palo Negro                          6.30
  Alto de No Leon                    19.30              2,100.00
  Alto de Lagrenazo                  25.30              2,330.00
  Colonia Tovar                      32.30              1,802.00

                  HIGHWAY FROM LOLONIA TO EL CONSEJO

  Colonia Tovar                          0              1,802.00
  Portero Perdido                     3.00              1,680.00
  Topo Carrizalito                    9.00              1,910.00
  Caserio Quebrada                   19.00              1,590.00
  El Consejo                         25.00                576.00

                HIGHWAY FROM LA COLONIA TO LA VICTORIA

  Colonia Tovar                          0              1,802.00
  Alto de Launita                     5.50              1,680.00
  Alto Gabante                       10.00              1,910.00
  El Pinto                           20.00              1,756.00
  Hacienda                           22.00
  Hacienda Sabaneta                  23.40                600.00
  La Victoria                        27.90                576.00

The charge for freight on the railroads is rather high, $.58 per
hundred pounds, and the passenger rate averages 10c. per mile. Hotel
accommodations are not scarce nor are they excessive in prices.
Statistics show that European commercial travelers can live on $3.50
to $4.00 per day while it costs the average American $7.00 per day.
The hotels are not as modern as in the States but are very clean and
suitable. The food is exceptionally good and wholesome.

The means of transportation by automobiles are as modern as those of
some of the largest cities of the world. The majority of the cars are
high priced and high powered as they are designed to climb to high
altitudes in the surrounding mountains.

It may be stated that the financial condition of Venezuela is superior
to that of any other country in Latin-America with the exception
of Argentina. Her public debt has been decreased and her financial
standing, although established comparatively few years ago, is very
high.

Germany, France and England prior to the war practically had a monopoly
on the Venezuelan trade, due largely to the long credits offered by
them to the Venezuelan merchants. Before the war the above mentioned
countries extended credit from four to nine months. The policy has
changed now and the merchants are satisfied with from three to four
months' credit. The reduction of the long term credit is also due to
improved banking methods, and it is expected that trade will soon
reflect the change when conditions are settled.

At the present time many of the exporting houses in the United States
are dealing on either a 90 day sight draft or a 120 day draft dated
New York. This system has been approved by the Credit Association of
America.

Since practically every exporting or importing country is represented
in Venezuela at the present time by bank affiliation, the average
commercial traveler encounters very little difficulty in having
his drafts or letters of credit honored. The difference in rate of
exchange is an important item and should be carefully considered by
all commercial travelers upon arriving in Venezuela. The exchange
fluctuates slightly, the rate now being $5.35. The standard of value is
the bolivar, valued at $.193, American gold.

One of the most exasperating difficulties confronting all commercial
travelers is their ignorance of the metric system. The system has
always been in effect here and must be learned in order to transact
business.

The customs duties of Venezuela are very high, more so than in many
other Latin-American countries. The high protective tariff has been
a means of increasing the revenue of the country but on the other
hand it has made it practically impossible for the poorer classes of
Venezuela to purchase foreign made goods. Another purpose of the high
protective tariff is to protect home industries but the fact remains
that the manufacturers in Venezuela can not supply the demand. In
many cases the tariff is so high that it is inadvisable for outside
merchants to attempt to do business there. For example, it would be
very poor business judgment for a shoe salesman to attempt to sell
shoes in Venezuela as that industry is well protected by the tariff.
The same applies to many other industries. Appeals have been made to
the Venezuelan government to lower the tariff but as yet it has not
complied with the request. Tobacco is another protected industry.
American cigarettes in Venezuela retail for as much as three times the
price in the States. The reduction of the tariff will open a greater
field for all commercial travelers and will mean an increased foreign
trade for Venezuela.

Before concluding this report it may be useful to say a word regarding
the present opportunities for commercial travelers in Venezuela and
the attitude of merchants in that country as to American travelers.
The writer has visited Maracay, Caracas, Valencia and La Victoria, and
after talking with business men reached the conclusion that American
commercial travelers are considered among the best and are most
welcome. The only complaints heard were that American concerns would
not allow more than a three months' credit and that the packing of
goods for shipment has been deplorable. The Englishman with his great
variety of goods such as woolens, cottons, crockery and with facilities
for long credit has gained the confidence of the merchants and has
built up considerable trade throughout the country. Germany prior to
the war also had considerable trade with Venezuela due to their banking
facilities and diversity of products. Before the war, for example,
Germany had a monopoly on the dye industry and the toy industry and
was thus able to establish herself successfully in Venezuela. American
business houses prior to the war had not realized the importance of
Venezuelan trade until the establishment of the International High
Commission, an organization which has brought South America and North
America into closer contact and thus assured friendly relations.

The old proverb has it that "Commercial travelers are here to-day and
away to-morrow." As the proverb is undoubtedly true, the only way
to leave a favorable impression with all is to smile, be courteous,
considerate and clean, not only in business transactions but in morals
as well. The possession and exercising of these social qualities will
be of inestimable advantage not only to commercial travelers but to the
good name of the United States.

                                                       _W. J. Donnelly._





PRESENT FOREIGN INVESTMENTS IN VENEZUELA
AND
FUTURE OPPORTUNITIES FOR AMERICAN CAPITAL


PART I

                PRESENT FOREIGN INVESTMENTS IN VENEZUELA

In a report on foreign investments in Venezuela, the public debt, at
least the external foreign debt, ought not, perhaps, be included as an
investment. For two reasons, however, it deserves consideration, first,
because of the sum involved and the manner in which the government
meets this obligation; and secondly, as a barometer of other nationals'
interests in Venezuela.


PUBLIC DEBT

The public debt of Venezuela is a topic important enough in itself
to warrant consideration in a special report, hence we shall concern
ourselves here solely with the _external_ foreign debt. Its history
is interesting but long and involved and since our interest as far as
this report is concerned is not in the debt itself but in the debt as
a factor in influencing investments in Venezuela, we shall confine
ourselves solely to a statement of the following statistics from the
Report of the Minister of Finance:[20]

                                     _June 30, 1919_  _December 31, 1919_

  1. Deuda Nacional del 3% annual
       por Convenios Diplomatics    Bs. 9,208,291.61     Bs. 9,088,291.61

  2. Certificados Provisionales
       (Españoles)                          1,600.00             1,600.00

  3. Deuda Diplomatics del 3%
       annual de Venezuela,
       Emisión de 1905                 84,511,755.00        80,295,615.00

  4. Deuda Diplomatica sin interes         23,769.12
                                  ------------------   ------------------
            Total                  Bs. 93,745,415.73    Bs. 89,385,506.61

[20] Cuenta de Gastos del Departmento de Hacienda, July 1, 1919, and
January 1, 1920.

The national debt of 3% is divided between France, Spain and Holland in
approximately the following proportions: France, 86%, Holland, 11% and
Spain, 3%.

The second item of 1,600 bolivares is held in the Venezuelan Treasury
pending a settlement as to whom the debt should be paid.

The 3% diplomatic debt is held by English and Germans, while the
diplomatic debt without interest due to France was entirely paid at the
expiration of December, 1919.

The obvious conclusion to be drawn directly from the above statistics
is that Venezuelan public finance is in good hands and that the
country is in a flourishing condition as witnesses a payment of nearly
$1,000,000 on the foreign debt in six months. Under such conditions,
foreign investors may feel reasonably sure that capital may be invested
here both securely and profitably.


FOREIGN BANKS

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.

Here, then, lies the prime investment of the country, a proper system
of railroads to make these rich natural resources available. These
projects have already been discussed widely, and Doctor Vicente Lecuna,
President of the Bank of Venezuela, considered the most prominent man
in the country, named railroads as the greatest need of the country and
the best investment for foreign capital.

Here we may be permitted to digress for a moment to point out an unique
advantage which Venezuela holds in regard to commerce with the United
States. Due to the opening of the Panama Canal, Venezuela can ship as
easily and quickly to the western part of the United States as to the
eastern and thus effect a considerable saving on trans-shipment of
goods by rail across the United States. Further, the proposal holds
much favor here to-day for the introduction of a steamship line to
Saint Louis which would be quicker and cheaper than the present line to
New York. Thus we see that three direct lines might be maintained from
the States to Venezuela, one from some western port via the Canal, a
second from Saint Louis which would transport the goods to the Middle
West; and, lastly, an expansion of the present service from New York.

[Illustration: VENEZUELAN STUDENTS DEPOSITING WREATH BEFORE STATUE OF
GEORGE WASHINGTON, CARACAS, JULY 4, 1920]

[Illustration: GEORGETOWN STUDENTS DEPOSITING WREATH AT THE TOMB OF
SIMÓN BOLÍVAR IN THE PANTHEON, CARACAS, JULY 4, 1920]

Here too a word would not be amiss relative to the present service from
New York. The Red D Line maintains a fleet of four passenger ships, the
largest being of three thousand tons and the time consumed from New
York to La Guaira usually nine days. The need for more and better ships
is obvious. With improved service, there is no reason why Americans in
search of a cool spot to visit in the summer time should not come to
Caracas situated, as it is, three thousand feet above sea level in a
mountainous country and with a wealth of that beautiful scenery found
only in the tropics.


PROPOSED RAILROADS

1. _San Felipe to Puerto Cabello._

The first line to be considered would run from San Felipe to Puerto
Cabello. Puerto Cabello already occupies a prominent place in the
economic life of Venezuela, being one of the principal ports and a
port of call for all American and European steamers. The proposed
railroad would be approximately eighty kilometers in length and would
pass through one of the best cacao regions of Venezuela. This section
is especially favored due to the trade winds which blow across it,
giving this locality a special aptitude for the raising of a superior
brand of cacao; it is from this section along the coast that the best
cacao in the world comes. At present, due to the lack of transportation
facilities, it is useless to develop the region, for the product
can not find its way to market. A railroad here would serve to make
available a huge, rich territory for cacao which could then find its
way into the markets of the world.

2. _San Cristobal to Valencia._

The second proposed railroad is one from San Cristobal to Valencia
passing by way of Barinas. Considerable construction work would be
necessary as this line would be about 615 kilometers in length, through
rich, fertile lands which at present lie untouched due to lack of
communications with the outside world. The railroad would lie over flat
level land except for a stretch of approximately fifty kilometers over
the mountains.

All along the southeast of this road lies fertile table land suitable
for the raising of cattle. In fact, the llanos extend all along the
route while to the north stretches the coffee producing section of
Venezuela. Near Barinas there are large cacao and tobacco plantations
but they are not developed to any appreciable degree nor to their real
capacity, due to the lack of proper forwarding agencies. Furthermore,
the opening up of this region by railroad would give great impetus
to further settlement and investment in the interior, for it is an
observed fact that after the railroad come cities and civilization.
The situation is similar to that existing in our own history when,
simultaneously with the building of the trans-continental railroads,
caravans pushed their way westward and have left as their heritage the
great cities of the West. This lesson from our own history should not
go unnoticed, for the same opportunity exists in Venezuela and to the
pioneers will come rewards similar to those reaped by our own dauntless
settlers.

Even now before the building of this railway, English companies have
acquired large concessions of territory near the proposed line. This
is only a start and soon they will be extending their concessions
and if Americans do not act before it is too late they will find the
choicest land already taken. Most of the English concessions lie in
the Apure district, the best cattle land in Venezuela, whose only
disadvantage lies in the fact that the land is frequently inundated
by the overflowing of the waters of the Apure River. The value of the
land, of course, depends on its fertility and the availability of
water, but it may be stated that a square league, that is, twenty-five
square kilometers (9 square miles), varies in price from two thousand
to five thousand bolivars, or from $400.00 to $1000.00. And this for
land in the best cattle section of Venezuela! Among other sections of
the country well suited for cattle raising are the llanos of Marturin,
extremely fertile lands, swept by the trade winds. As they are situated
in the northwestern part, shipment could be made through the port
of Guanta which, it is predicted, will be the future main port of
Venezuela. In this same vicinity lie the llanos of Barcelona, even
closer to the port high tablelands, but somewhat dryer than the llanos
of Maturin. To develop this land, a railroad from Ciudad Bolívar, a
port used now on the Orinoco and Barcelona, is necessary. This would
connect with the present line from Barcelona to Guanta, thus connecting
two important ports and serving a rich cattle section, necessitating
the building of only three hundred kilometers of road.

Further west, running parallel to the last mentioned line, lies a
region between San Fernando and Cagua, and as Cagua is already on a
railroad line, shipments can be made either to Puerto Cabello or La
Guaira. The llanos of Guárico which lie in this region are high table
lands but with numerous oases which provide sufficient water for the
cattle. At times, parts of this region are subjected to inundation
which makes the land very rich and fertile. This is another section
merely waiting the day when capital will develop railroads. It may not
be amiss to remind American investors that the English have already
secured three large concessions along this route.

Another important consideration deserving of mention is that along
this route lie coal mines which have not been developed due to lack of
transportation facilities. These mines would serve as an easy means of
procuring fuel for the road.

3. _Limon-Castilletas._

Another railroad projected is that from Limon to Castilletas. About
Limon are rich oil fields now being developed but which are handicapped
by the fact that Maracaibo, the present shipping port for oil, lies
inside the Gulf of Maracaibo and only small ships can enter due to
deposits which are continually filling up the strait. Maracaibo is not
always available for small ships and a line from Limon to Castilletas,
which is a port lying outside the bar and on the shores of the Gulf of
Venezuela, would solve the present difficulty and, besides, effect a
saving of over two hundred kilometers in sailing distance.

4. _Yuruari-Orinoco._

The last important railroad which the country needs is one from the
Yuruari River to the Orinoco. About the region of Yuruari are rich gold
mines which are only worked to a small extent and in a very primitive
way due to the impossibility of bringing the necessary machinery to
the mines. Not only would a line connecting the two rivers do this but
it would also pass through rich grazing lands. Then, too, only a short
distance to the east are the iron mines of Imataca, still unworked due
to the lack of transportation facilities.

Railroads are, then, the key to a double prosperity--prosperity for
the foreign investor and an opportunity for Venezuela to take her
proper place in the markets of the world. It seems inconceivable that
here, close at hand, potential factors of great wealth are lying
dormant awaiting the magic touch which in this case must come from the
railroad, the forerunner of civilization. Dipping further into the
future, we can see other results which would quickly follow the opening
up of this great country,--an increase in immigration, consequently
a larger market in which to buy and sell. And whom should it benefit
more, the United State close at hand, or Europe a week further away!
Time alone will decide, but this point can bear emphasis again and
again that now is the propitious hour when, due to the recent war,
American goods are being sought for in increasing volume by Venezuela.
But England is already in the field and Germany is striving hard to
regain her lost place in the sun. It behooves all of us, therefore,
to strive with might and main to consolidate the position in world
commerce which was thrust upon us and there lies no better path to that
end in South America than along iron rails constructed by American
capital in the sister Republic of Venezuela.

                                                    _Joseph P. Quinlan._





FOREIGN TRADE OF VENEZUELA
AND
AMERICAN GOODS IN VENEZUELA


PART I

                       FOREIGN TRADE OF VENEZUELA

Where there is population, industry and resources, there will be
international trade. Venezuela is lacking in population and her
industries are scarcely in the first stages of development, but she
possesses natural resources which command a world market. The three
essentials of commerce are: (a) transportation, (b) freedom of labor
and exchange, (c) security; and at the root of all trade must be moral
integrity.[21]

[21] Ency. Brit., "Commerce."

Until the beginning of the present administration, Venezuelan commerce
has been fitful and unsatisfactory. Under the Gómez régime, however,
the country has taken great strides forward, especially in internal
development and in the establishment of a national credit of which it
is justly proud. As a result, her foreign commerce, except for a slight
falling off at the beginning of the war period and a rather sharp
decline in 1918, has shown a steady growth.

Transportation gives commodities and persons "_place utility_" and
until the establishment, recently, of a splendid system of motor roads,
as yet but little used, Venezuela has been lacking in this respect.
Natural resources, in the absence of local manufacturers, become
worthless without means of transportation to the coast for export. In
1908 there existed but thirteen railroads in Venezuela with a total
mileage of 540 kilometers[22] connecting a few of the richest and most
accessible regions with the coast, and the year 1920 finds no increase
either in number of roads, or in total mileage. Fertile inland regions
are still without outlet for their products and vast mineral wealth and
forest resources lie untouched, awaiting transport facilities.

[22] Central Executive Council, International High Commission,
"Venezuelan Financial and Economic Conditions," and Ency. Brit.,
"Venezuela."

The Venezuelan coast line extends for 1876 miles and possesses in all
32 ports of various sizes, more than sufficient to handle the potential
commerce of the country. The amount of commerce passing through these
ports, though steadily mounting, has in no one instance approached
the limit. These ports have developed in spite of onerous tariff
regulations and other handicaps, because the demand for the riches
possessed by the Republic in the shape of natural resources is too
insistent to be checked by natural or artificial barriers.

The principal industries are agricultural and pastoral, the most
important agricultural products being coffee, cacao, sugar, tobacco,
corn and beans.[23] Manufactures are few in number and those existent
for the most part flourish mainly by the help of severe tariff
discriminations. These manufactures include the following lines: beer,
hats, candles, ice, chocolates, matches, cigarettes, boots and shoes,
cotton goods, drugs and medicines.

[23] International High Commission, "Zones of Venezuela."

There are several electric plants in Venezuela and a few factories for
the manufacture of agricultural implements. On the whole, however,
Venezuelan manufacturing is still in its infancy and the country must
depend on importation for nearly all her manufactured wares; this
flow of importation is conditioned by the nature of the population
whose purchasing power, except for the gentry of Caracas and a few of
the more advanced cities, is limited, in great part, to the barest
necessities of life.

On the whole, the World War had a beneficial effect on Venezuela's
foreign commerce. At the outbreak of the war, Europe withdrew her
shipping and Venezuela's foreign commerce was hard hit. The year 1914
witnessed a sharp decline, but gradually in the ensuing years the
figures mounted until in 1917 they were nearing the pre-war totals,
only to fall off sharply in 1918. Advanced statistics for 1919, with
no return from the Aduana of Maracaibo, indicate a phenomenal increase
both in imports and exports for 1919 over the previous year. The
value of Venezuela's total foreign commerce by years, in millions of
bolivares, follows:[24]

  1913     Bs. 246
  1914         184
  1915         191
  1916         228
  1917         239
  1918         179
  1919         315

[24] "Alta comisión internacional," Sección Venezolana, Caracas, 1919;
"Memoria de Hacienda," 1919.

In 1917 the imports into Venezuela from the United States amounted to
70% of her total imports. For the same year, Great Britain's share of
import trade was 16% and all others 14%. The same for 1918 follow:[25]

  United States     60%
  Great Britain     30%
  Others            10%

[25] Bureau of Foreign and Domestic Commerce, "Venezuela."

In 1917 the exports from Venezuela were apportioned as follows:

  United States     55%
  Great Britain     11%
  Others            34%

The same for 1918 follow:

  United States     45%
  Great Britain     17%
  Others            38%

Incoming shipments by parcel post for 1917 amounted to Bs. 3,837,916
($740,719.00), the principal articles coming by this method being
drugs, medicines, jewelry, watches, hats, cotton goods, silks and
rubber manufactured goods.

  IMPORTATION BY PARCELS POST

   _Source_       _Year_     _Year_
                  _1917_     _1918_        _1919_
  U. S.         $350,339
  92,423   (not available)
  France         228,559     56,648
  Italy           76,127     59,923
  United Kingdom  61,626     94,258
  Spain           19,570      3,595
  Others           4,498     20,100
                --------    -------
  Total 1917    $740,719   $524,947
  Total 1918     524,947
                --------
  Decrease       215,772

Although the foreign trade of Venezuela actually decreased during the
war, the country was indirectly benefited by the turning of the energy
of the nation to the development of natural resources, which, in turn,
must mean in due course an increased surplus of production for export.
Furthermore, the shortage of shipping during the war necessitated the
use of existing bottoms to the fullest extent with a consequent effort
towards the improvement of terminal facilities and an increase in the
speed of loading and unloading cargo carriers. As a result of this
feverish war activity, a number of Venezuelan ports now possess modern
equipment for speedy handling of cargo and with the products of the
country moving seawards in increasing quantities, Venezuela's harbors
should be attractive ports of call for tramp steamers and conducive to
the establishment of other routes of liner traffic.

The principal articles imported into Venezuela are cotton, textiles,
wheat flour, machinery, agricultural implements, kerosene, drugs and
medicines. The principal exports are coffee, cacao, balatá, hides and
skins, rubber, gold, copper, sugar, asphalt, heron plumes and cattle.

Estimating the bolivar at .193 cents gold, the accompanying figures
show the extent, in United States currency, of Venezuela's foreign
trade:

  1917--Imports    $22,188,223.08
        Exports     23,164,701.60
                   --------------
            Total  $45,352,924.68

  1918--Imports    $14,908,275.39
        Exports     19,813,216.67
                   --------------
            Total  $34,721,492.07

        A decrease in imports for 1918 over 1917 of     $7,279,947.69
        A decrease in exports for 1918 over 1917 of      3,351,484.93
                                                       --------------
        A total decrease in foreign trade for
                                  1918 over 1917 of    $10,631,432.62

  1919--Imports    $27,020,000.00
        Exports     33,196,000.00
                   --------------
            Total  $60,216,000.00

        An increase in imports for 1919 over 1918 of   $12,111,724.61
        An increase in exports for 1919 over 1918 of    13,382,783.33
                                                       --------------
        A total increase in foreign trade for
                                   1919 over 1918 of   $25,494,507.94

(Above figures were compiled from official sources; advance estimates
for 1919 from "Memoria de Hacienda, Ano civil de 1919.")


PART II

AMERICAN GOODS IN VENEZUELA

American goods have always been welcome in Venezuela, even when
Americans were _personae non gratae_ in the country. The greatest
obstacle in the way of increased sales of American goods in Venezuela
is _American selling methods_.

In selling the Venezuelan market, German and British merchants
have always evidenced a readiness to adapt their goods to meet the
requirements of Venezuelans, while it has been the policy of Americans
in general, to attempt to force their customers to alter their
requirements to fit American goods. The World War, by shutting off
Europe from South America, helped certain American dealers to force
on Venezuela goods which the merchants of that country did not want.
A homely example of American "strong arm" selling methods occurred
during the war in the matter of an order for a quantity of stickers, or
labels, to be pasted on small packages. The Venezuelan house ordered
the labels without the usual gummed back, as the climate of the country
propagates myriads of mucilage-hungry insects and was clearly not
favorable to the usual form of gummed-back stickers. Therefore, the
order was given for a certain number of printed labels with plain
backs, the intention being to apply mucilage to the labels as needed.
The American exporter, however, promptly sent the usual gummed-back
labels with the intimation that he was selling labels with gummed-backs
and not labels with another kind of back and that he did not think
it advisable to change his wares in order to fill a small order. The
Venezuelan house needed the labels and as Europe was isolated, it was
forced to accept, under protest, an article which was clearly doomed
to prove unsatisfactory. This is but one example of what I have been
told is one of the greatest defects in American selling policy. Now
that the war is over and Europe is hastening to pick up the slack ends
of her world trade, America is liable to lose a large part of her
war-won trade if she does not immediately alter her previous attitude.
"With the exception of flour, lard, lumber, cement, certain lines of
dry goods, typewriters, cash registers, sewing machines and a few
other articles in which Europe does not compete, the main current of
importation into Venezuela has been from European countries, which
have for many years made a careful study of the merchandise and packing
requirements of the Republic. Backed by ample banking facilities,
European firms have given liberal and long credits to facilitate the
sale of their products."[26]

[26] "Market for Construction Materials in Venezuela," Bureau of
Foreign and Domestic Commerce.

The necessity of careful packing has been systematically dinned
into the ears of American exporters and as consistently ignored. As
import duties into Venezuela are in many cases charged on commodity
and container alike and as the chief means of transportation in the
interior is by burros, over mountain trails, the packing should be as
light and at the same time as durable as possible. In this connection,
there is a story current in Caracas with reference to a shipment of
small balloons for testing purposes, which may or may not be true, but
which vividly illustrates the point. The American house, upon receiving
an order for a number of balloons to be delivered to Venezuela, is
charged with having inflated each and every balloon, enclosed each
balloon in a separate case and shipped the entire order in this form!

In the near future, Germany will again be a dangerous competitor in
Venezuela. At the present time there is a German trade commission
touring the country and plans are also in process of formation for
German immigration on a huge scale. Though the present government of
Venezuela is more than well disposed towards the United States, it is
clearly evident that the mass of Venezuelans while not hostile, are
rather more suspicious than friendly, while the feeling of sympathy
for Germany is and always has been manifestly very strong. There is
strong German propaganda now at work in Venezuela for the future sale
of German goods. The idea is deeply set in the Venezuelan mind, as
deeply rooted as his feeling of distrust of the "Norte Americano," that
what is made in Germany is the best. There have even been instances
where American goods have been sold as "Made in Germany," because of
this skillful insinuation of the superiority of German goods. For a
long time "Reuter's soap," manufactured by a New York concern, sold
widely in the Republic, and every Venezuelan merchant would have sworn
that the Reuter Company was a German concern, in spite of the fact that
"REUTER COMPANY--NEW YORK," was plainly marked on every package. The
United States should institute a counter trade-propaganda in favor of
goods "Made in America," if she would retain and increase the volume of
her trade with Venezuela.

Experience has shown that the best means of furthering the sale
of American goods is through the establishment of agencies in the
principal cities of the country. Formerly much good American energy
was wasted through the practice of sending out commercial travellers
who toured the country without first studying the field and reporting
regularly to the head office in the States. A resident American
agent, with several assistants to alternate on selling trips into the
interior, forms friendships, observes, and establishes liaison with the
government, which is of prime importance in commercial dealings with
certain Latin-American republics. Especially in meeting the peculiar
customs regulations by which so many incoming shipments are questioned,
held up, fined or confiscated, is the resident foreigner more apt to
secure expeditious treatment while the native handling an agency would
be without the recourse always at hand for the American representative.

A serious obstacle to Venezuela's trade and to the future extension of
the sale of American goods in the Republic is the complicated system of
customs collection. The complaints heard are those of friends anxious
to facilitate trade and eliminate sources of friction. "There are nine
classes in the customs tariff, ranging from 0.05 Bs. per kilo gross
for the first class to Bs. 20 per kilo gross for the ninth class. In
addition to the regular schedule, some articles are subject to specific
or ad valorem surtaxes, two surtaxes of 12½% each, the National Tax
and the Territorial Tax were authorized in April, 1901, and a 30% duty
established by a decree of February, 1903, for the purpose of paying
off the foreign indebtedness and continued by decree of June, 1912, to
be used for internal improvements. There is also the sanitary tax of
1% and a surtax of 30% on imports from the West Indies (since June,
1881) designed to promote the establishment of wholesale houses and
warehouses."[27]

[27] Compilations from "Ley de Aduanas," and "Ley de arancel de
Derechos de importacion de 16 de junio de 1915."

"American exporters have been discouraged by the intricate system of
fines and penalties imposed by the customs regulations for slight
errors in invoices."[28] The customs collectors and officials receive
meager salaries, but the discoverer of an error in an invoice, or other
violation of customs regulations, receives one half of the resultant
fine. Consequently, there is a natural zeal in discovering errors,
frequently resulting in fines for the omission of commas, faulty use
of semi-colons and for abbreviating. "As compared with other South
American countries, Venezuela is placed at a distinct disadvantage and
many American merchants have refused to continue doing business in the
Republic."[29]

[28] Bureau of Foreign and Domestic Commerce, "Venezuela."

[29] Bureau of Foreign and Domestic Commerce, "Venezuela."

Other obstacles to the furtherance of the sale of American goods in
Venezuela are poor steamship connections with the States and the
resultant slowness of mails and the unwillingness of the larger
American export houses to ship small trial orders which the merchants
in Venezuela frequently insist upon.

In closing, the writer may use the privilege of a patriotic American to
say a word concerning the impressions he received as to the character
and ability of the salesmen of American goods encountered in Venezuela.
While there are many young men in the field who are models of strong
character and efficiency (for the most part Porto Ricans), it must be
confessed that the larger cities and the capital, Caracas, are not
over-supplied with energetic young American salesmen of steady habits
able to command the respect of the Venezuelan buyers.[30]

                                                   _George A. Townsend._

[30] Together with this report the writer has submitted detailed
statistics containing the following information; the tables are on file
in the School of Foreign Service:

  1.--Ten year table of foreign trade of Venezuela.

  2.--Value of imports by ports in bolivares.

  3.--Principal articles of export for the years 1917 and 1918 valued in
        bolivares.

  4.--Exports by ports, 1917 and 1918 (bolivares).

  5.--Destination of exports, 1918 (bolivares).

  6.--Entrance of ships by ports--1918.

  7.--Entrance of ships by flags--1918.

  8.--Sailings by ports--1918.

  9.--Sailings by flags--1918.

  10.--Imports for the six years 1913 to 1918 (in bolivares).

  11.--Exports in the six years 1913 to 1918--bolivares.




APPENDIX




I

    LECTURE DELIVERED BY DR. PEDRO ITRIAGO CHACÍN ON JULY 30, 1920,
      IN THE SCHOOL OF POLITICAL SCIENCE OF THE UNIVERSITY OF
      CARACAS, MARKING THE END OF THE COURSE OF STUDY CARRIED ON BY
      THE STUDENTS OF THE SCHOOL OF FOREIGN SERVICE OF GEORGETOWN
      UNIVERSITY IN CARACAS, VENEZUELA.


  _Professor Sherwell:_
  _Students of the University of Georgetown:_

We are pleased that you have had the opportunity to experience the
affection of the Venezuelan Government and people for your illustrious
country, a country admirable in every respect and especially because
of the fact that when our nationalities began their lives, she was the
stronghold of American rights.

Through a magnificent destiny, which you are loftily fulfilling, you
proclaim yourselves the champions of a democracy whose models will be,
on the American continent, amid glory common to us all, Washington and
Bolívar; the one representing the equanimity of the great Saxon race,
and the other embodying the dreams of progress, at times impatient, but
always magnanimous, of that Latin soul which vibrates in our veins and
inspires our conduct.

These two souls come into symbolical contact to-day,--and God grant
that it be forever so!--in this intellectual communion of youthful
students at the foot of our Ávila, students who may one day be the
citizens of that future country announced by Rodó, which may then
call itself by a single, glorious name--simply and grandly,--America,
a country created not through political combinations or sordid
calculations, nor through imperialistic and warlike expansions, but
through community of interests and community of ideas; a country
created through confraternity, supported by justice, and made
everlasting through right.

  Gentlemen:

The noblest edifice that has reared its ideal shield over the world is
Law.

No institution created by mortal beings (by its grandeur, law has been
thought divine, and indeed, _jus_ and _fas_ were identical in their
origin) answers more fully the higher aspirations of the human soul.

Man, who has lived in a hole in a rock, or on his native plains, under
the roof of heaven, can build for his residence dwellings more or less
sumptuous; for him a ray of a torrid sun is an abundance; when he loves
or dreams he is satisfied with a moonbeam and is able to boast that he
has destroyed darkness; man, who carries within himself the essential
substance of all beings, the substance which, by its manifestations,
is the synthesis of the world, and through which great silent men can
live happily by themselves, may traverse distances with the wings of
the condor and, at will, join his fellow-beings for pleasure or for
labor; he inhabits palaces with Agrippa, partakes of banquets with
Lucullus, and is carried with Cleopatra, in the bark of pleasure, the
nuptial, dream-hued ship. * * * But is that all, the final purpose of
his destiny? Is such perchance, the essential? Does that answer the
cravings of his own soul and the conscience of humanity?

No; that is not the test of value, not even of progress. For in the
face of such philosophy a thousand queries will ever rise to his lips.
Is he free or not? Does he enjoy equality and, on his part, does he
not tyrannize? Does he hold among his fellow-beings a place, great or
humble, but a place, none the less, from which he can work out his
own destiny and that of a group such as his family, his city, or his
country? May he think, live, produce, build up a fortune and a home
for himself, thus ennobling with a serene dignity his existence and
finally perpetuating himself, through his ideas, his children, and his
achievements? In order that we may always freely answer "yes," man
has forged Law. And I repeat it, he has truly forged law because that
process, though begun with man himself and continuing through all the
ages to be his glory in history and for eternity, this science which he
has produced is like those lofty structures which have exhausted the
effort of one generation after another, their formidable architecture
forever providing unfinished work for generations to come.

In that great total, one of the most modern and perhaps one of the
noblest parts is International Law, whose subjects are not merely
individuals, but the groups we call states.

When, in the midst of the dismay produced in our souls by the European
war, I began, in 1917, my lectures on the History of International Law,
I made an optimistic profession of faith, a profession of absolute
faith in the efficacy of those principles of justice which must
regulate the relations of peoples.

Permit me to repeat what I said on that occasion:

International Law is truly a triumph of reason. Applying to this
subject a well-known saying spoken, however, with reference to
broader fields, it is "human reason itself in so far as applied to
the government of nations." For although some of its rules are obeyed
crudely and instinctively as manifestations of social requirements
in primitive groups, force, which is the negation of Right, has
prevailed over those rules to such an extent that only through the
supreme influence of religious ideas, which are all powerful in the
infancy of social organizations, have they been applied to some extent
in safeguarding rights such as the respect due to ambassadors, the
inviolability of sacred truces and the burial of soldiers fallen on
battlefields.

It was through an effort of reason, ever progressing and steadily
receiving more enlightenment, that, with the passing of centuries,
those standards which now impose unavoidable obligations on modern
states have been established. The evolution has been harmonious in its
changes, and reflects the different stages of civilization through
which mankind has advanced.

Reason has striven to replace the reign of violence, the negation of
thought, by effecting the progressive development of human society
through the force of justice; and, hence it is that every day more
perfect relations have been established among civilized countries
through respect for the equality of all and through the acknowledgment
of mutual individuality, which is in effect a consequence of the
respect we demand for ourselves. In short, this advance rests on the
realization of the dignity of man, a realization which, in this case,
leads men logically to admit the sovereignty of the people and the
sovereign independence of the state, which implies that each is free
to organize as it seems fit in order to fulfil its destiny without
foreign interference.

It is only too true that the present catastrophe which shook the
world has given rise to the thought, the sad thought, that the work
of centuries has failed; and truly the spectacle appals us with its
magnitude. The leaders of humankind, who led the forward movement
towards spiritual freedom, who had fostered congresses and conferences
designed to draw men closer to one another and thus to settle their
differences, who had established at The Hague a supreme Tribunal of
Nations, have seen themselves compelled to adopt the very expedient
which seemed forever repudiated because of universal condemnation.

England, prudent England, the model on which all free nations chose to
shape their institutions and their lives; vigorous Germany, as learned
as she is strong, whose power is established through the maintenance
of that discipline and virile rule of life admired by Tacitus who
proposed it to the decadent Romans as reproach since it could not
serve as a model; Italy, our teacher in arts as well as in the science
we profess, favored as she was with the subtle, deep and harmonious
genius which made forever famous the schools of Proculus and Sabinus;
France, admired and admirable France, alma mater of so many happy
innovations and of so many generations of high thinkers, especially of
that generation of a century ago, deemed heroic as Carlyle understood
heroism, and which aroused by Bolívar translated idealism into action
and immortalized the most transcendental moment in the history of these
Americas;--Russia,--I shall refrain from mentioning Russia because a
dark cloud has obscured for the great majority the spiritual strength
of that people, weighed down with future problems but permeated with
a sentimental and deep mysticism which some discovered when they grew
to admire Tolstoy and Dostoievsky whom Enrico Ferri has compared to
Dante,--all these nations and those they strongly influence, all these
peoples who occupy so prominent a place in history, we see fanaticized
by the fire of war, sowing death mercilessly, spreading ruin from one
hemisphere to another and planting pessimism, if not despair, in one
conscience after another. This, too, just when it seemed impossible
that any of them, at the present stage of development, should need to
engage in contest other than those through which life could be more
secure and comfortable, physical welfare greater, and nations brought
nearer the tranquil reign of the spirit.

But we must never lose sight of the fact that all this is but a crisis,
one of those great convulsive crises of the moral organism, from which
the concept of right and the necessity of employing the only formulas
truly protective of equity and justice shall emerge more vigorous than
ever.

After this great war, the desire for a lasting peace will be more
intense, and the means to make that peace certain will be applied with
greater energy.

These hopes, cherished by many of us during the struggle, we have
seen synthesized in the Wilsonian concept and incorporated with the
precision of a code in the Covenant of the League of Nations. Since
the appearance of Christianity, only the Thirty-Years war terminating
in its Congress of Westphalia, and the French Revolution, with
its declaration of the rights of man (which Grégoire intended to
supplement with a declaration of the rights of states), will leave on
international law as deep a mark as the World War with its Covenant of
the League of Nations.

A flight of eagles, but happily not of imperial eagles, crosses
all borders; a magnanimous feeling of solidarity struggles to
conquer sterile distrust, and the members of the human family begin
to recognize each other. It seems as if we were approaching the
realization of the generous idea of Cicero and Seneca; man is nowhere
a foreigner; his true country is the universe. The dream of a _Magna
Civitas_, the ideal city of humankind, is taking shape.

Wilson's plan tends to that end. We have seen that it is not new, but
it is great. Among others, Sully and Henry IV, the Abbé Saint-Pierre
and Rousseau, cherished this idea, which Voltaire, the skeptic,
considered chimerical. Kant, the philosopher, used to say: "What we
desire is a General Congress of Nations, the convening and duration
of which would depend entirely upon the sovereign will of the several
members of the league."

The lineage of statesmen, of dreamers, and of philosophers is a single
and privileged moral descent. Prudent forethought, creative imagination
and profound grasp of the supreme laws which regulate nature and man
are crystallized in the souls of liberators. Bolívar also strove to
establish an Assembly of Nations at the Isthmus of Panama. And it is
worthy of notice that these nations in Bolívar's plan, as well as in
the Covenant of the League of Nations, would be forced to obey the
principles of International Law. The Congress, in his first project,
was intended to be established somewhat rigidly, and, in that, too,
Bolívar anticipated the ennobling of an idea, fostered by modern
writers like Blunstchli, Dudley Field, Fiore, Pessoa (now President
of Brazil), and which has been the subject of numerous international
conferences.

What deep sadness must our great liberator have felt when in figurative
language he compared his ineffective plan for a congress with the
insane Greek of old who thought that standing on a rock, he could steer
the ships passing on the sea!

The immediate genesis of the Covenant of the League of Nations is found
in the famous Fourteen Points of President Wilson.

Some of them follow:

    In the first, President Wilson proposes international
    agreements of peace entered into frankly and openly, and the
    obligation of proscribing secret international agreements of
    any kind in the future.

    In the second, he proposes the freedom of the seas in time of
    peace as well as in time of war, exclusive both of territorial
    waters and of seas which may be closed by international action
    with the purpose of carrying out international agreements.

    In the third, he proposes the suppression, as far as possible,
    of economic barriers, and the establishment of equal commercial
    conditions for the states which would accept the peace and join
    to maintain it.

    In the fourth, he proposes the reduction of armaments to the
    minimum limit compatible with the internal safety of each
    country.

    Lastly, in the fourteenth, he proposes the creation of a
    General Society of Nations to guarantee the territorial
    integrity and the political independence of the small as well
    as of the large states.

Certainly, this helmet of Mambrinus suffered numerous bruises, as
happens to all generous dreams when they come into contact with
selfishness or with the consuming breath of the passions of the
moment; let us have faith, however, in that saintly philosopher who
teaches, on the contrary, that the perfect being is he who passes from
understanding to reality, and let us hope that it will evolve toward
superior forms.

Let us hope that such a helmet will not prove to be the shaving dish of
a barber.

The purposes of the League are condensed in its admirable preamble:

"The High Contracting Parties,

    In order to promote international cooperation and to achieve
    international peace and security by the acceptance of
    obligations not to resort to war, by the prescription of
    open, just and honorable relations between nations, by the
    firm establishment of the understandings of international law
    as the actual rule of conduct among Governments, and by the
    maintenance of justice and a scrupulous respect for all treaty
    obligations in the dealings of organized peoples with one
    another," and so on.

In order to realize these purposes, it is necessary to establish means
which will enable nations to settle their differences without having
recourse to war. It is necessary to reduce present armaments and to
eliminate for the future this burden which weighs upon modern peoples
as the hateful war tributes of antiquity, and which is nothing less
than a resurrected form of slavery. In order to obtain this, the
Council of the League is charged with the work of formulating a program
for the reduction of armaments, based upon the inquiries and decisions
made by the respective governments, and with the purpose of keeping
under control the manufacture of ammunition.

Regarding the first point, a set of measures already established by
international law is ordered, and strongly sanctioned by provisions of
the Covenant.

The states between which disputes or conflicts may arise will have
recourse to the Council or to the Assembly, or will submit their cases
to arbitration. They are forbidden to resort to war until three months
have elapsed after the decision of the Council or the Assembly or of
the third state to which they may have recurred; all this with the
purpose that the counsels of prudence, the strength of just decisions,
and that the calming and tranquilizing action of time itself may have
their effects on the irritated feelings of men.

In order to obtain its principal object, the Covenant also provides for
the creation of a permanent Court of Arbitration, an institution which,
with the economic sanctions established in the same Covenant, will be
the most effective instrument of its civilizing action, for we know
well that peace will never exist among men while justice is denied.

The project for the establishment of a permanent code of international
character met at The Hague, and has always met, one formidable
obstacle: How can all the states be represented in a body which must
necessarily be small?

It is noted that the omission of some of them is considered as
a flagrant violence of juridical equality and derogatory to the
sovereignty of those states.

In the second meeting of the Council, held in London, this topic
was carefully studied, and after a brilliant report by Bourgeois,
it was agreed to submit the matter to a committee of prominent
internationalists in order that they might devise means to obviate
such difficulties as impeded the realization of the purpose. Among
those international figures two South Americans were included: Clovis
Bevilacqua and Dr. Drago, the name of the latter now being associated
with sad memories, a man for whom Venezuela retains grateful and
respectful affection.

Another project of the League is the organization of labor. Do you know
any human beings more worthy of the consideration of the mighty and the
pity of the world than the child, the woman and the workman who spends
his strength in fruitful labor?

After having presented the more remote antecedents and the genesis of
the Covenant of the League, as well as the ends it aims at and the
means it follows to realize them, it only remains to say something of
the working of the new organism of the international law created by the
Covenant. In this I shall follow the Covenant itself:

                         MEMBERS OF THE LEAGUE

    The members of the League are of two classes, the original
    members and those later incorporated.

    The original members are:

    1. The Allied and Associated Powers signatory of the Treaty of
    Peace.

    2. States invited, which may have acceded without reservations
    to the Covenant.

Thirteen states, among them Venezuela, were invited, and all acceded.
The incorporated members are:

    Any fully self-governing State, Dominion or Colony which may be
    admitted.

Any member of the League may, after two years' notice of its intention
so to do, withdraw from the League, provided that all its international
obligations shall have been fulfilled at the time of its withdrawal.

The Assembly is empowered to receive new members of the Society by a
vote of two-thirds of its members.

Any member guilty of non-fulfillment of the obligations established by
the Covenant may be expelled from the League by the unanimous vote of
all the members of the Society represented in the Council.

       *       *       *       *       *

ORGANS AND FUNCTIONS

The organs of the Association are:

  A. The Assembly;
  B. The Council.

They will be assisted by a permanent Secretary.

       *       *       *       *       *

The Assembly will be composed of not more than three representatives
for each member of the League, who will have the right to one vote only.

The Assembly may deal at its meetings with any matter within the sphere
of action of the League or affecting the peace of the world.

The Council shall consist, at present, of representatives of the
principal Allied and Associated Powers, together with representatives
of four other members of the League, as follows: one representative
of the United States, one of the British Empire, one of France, one
of Italy and one of Japan; and four other members who, until new
appointments are made by the Assembly, will be representatives of
Belgium, Brazil, Spain and Greece.

Since the Covenant of the League has not been approved by the Senate of
the United States, that Power has not had the stated representation,
and the meetings of the Council have taken place with the other eight
members.

       *       *       *       *       *

The Assembly and the Council shall decide (as a rule) by the unanimous
vote of all the members represented at the meeting.

All matters of procedure (appointment of investigation committees,
etc.) will be decided by a majority vote.

       *       *       *       *       *

The Secretary-General shall be appointed by the Council with the
approval of the Assembly.

       *       *       *       *       *

The representatives of the Association shall enjoy diplomatic immunity.
Their meetings, buildings, etc., shall be inviolable.

The Council may select the seat of the League. For the present, the
Covenant establishes that seat in the city of Geneva.

       *       *       *       *       *

A Military and Naval Commission shall be established to advise on
military, naval, and aerial questions generally, and especially on the
execution of the provisions of Articles 1 and 8, that is, regarding the
Members of the League and the reduction of armaments.

       *       *       *       *       *

The Council is empowered to

1. Prepare the plans for the reduction of armaments, in view of the
investigations and decisions made by the several governments.

2. Take steps with regard to the private manufacture of ammunition and
war materials.

       *       *       *       *       *

The members of the League undertake to respect and preserve as against
external aggression the territorial integrity and existing political
independence of all members of the League. The Council shall advise
upon the means to assure guaranties for territorial integrity and
independence. Any war or threat of war against any member of the League
is a matter of concern to the whole League.


SPHERE OF ACTION OF THE LEAGUE

The League, through its contractual character, establishes unavoidable
obligations for the states which enter it. Accordingly, the remaining
states shall be foreign to it, since it is well known that the
conventions impose obligations only on the parties signing them or
adhering to them.

But the nature of this international organism itself prevents its being
entirely so. The League, considering the ends at which it aims, could
not limit its actions to the states forming it, even though those
states may be, as they are, almost all the countries of the world. It
is obvious that the League, on reducing its armaments, could not see,
without concern, another state extraneous to it increasing its own
armament.

We have already seen that the Assembly has to take cognizance not only
of all that is comprised in its field of action, but of all which may
affect the peace of the world, and this gives it an unlimited sphere of
action.

In the event of a dispute between a member of the League and a state
which is not a member of the League, the state not a member of the
League shall be invited (among other measures to preserve peace) to
accept the obligations of membership in the League for the purpose of
such dispute.

In general, regarding states not members of the League, the League
shall endeavor to bring it about that they accept in their disputes the
same juridical procedure as the members of the League, that is to say:
mediation, arbitration, commissions of investigation, etc.; and the
League may even apply the sanctions which the member states may incur
for non-fulfillment of the Covenant, and which range from measures of
economic isolation to acts of warfare.

A formalistic and narrow criterion alleges that international law is
not law at all, since the three elements which make law tangible for
all persons,--the legislator, the judge, and the executive, are lacking
in it.

The Covenant of the League of Nations undertakes to present all those
personages. It offers all to us simultaneously, the legislator _par
excellence_, the judge and the executor of all great decisions, in one
and the same organ, namely the vigilant public opinion of humankind.

Here, in brief summary, as prepared for a lesson, is the Covenant
of the League. If it fails to-day, it will reappear. That idea is
immortal, and it will come back purified and more beautiful. The fact,
now unquestionable, of economic solidarity must bring about political
solidarity. Nations will no longer be able to attack and dismember each
other without injuring themselves.

Solidarity and cooperation; diplomacy frank and open, and at the
service of the peoples, not, as heretofore, a false art of courtiers
and lackeys; permanent freedom for navigation and commerce; economic
liberty; general disarmament; equality among states, the great as well
as the small, these are the ideas expressed, with the conviction and
the prestige of an apostle, by President Wilson and which the universal
conscience of mankind, although it had known them before, has now taken
up as a new gospel.

The thinkers of the French Revolution could well be proud of having
proclaimed the right of man. To President Wilson will belong the glory
of proclaiming the rights of peoples, because the League of Nations
does not mean the denial of patriotism, the denial of country, but the
glorification of this sublime concept, as the idea of country does not
exclude the mother idea of family and home, which was and ever remains
its necessary foundation. These are the links of a mystic chain, not
of oppression but of salvation, of unity and harmony. Build honorable
homes and you will have a great country; ennoble your country through
virtue and you work for the world.

I thank you all, especially Dr. Sherwell, for having been so good as to
honor with your presence this simple ceremony.




II

EDITORIAL COMMENT ON THE GEORGETOWN MISSION TO VENEZUELA


GOOD TRADE AMBASSADORS

             [_From N. Y. Post Express, August 11, 1920._]

Georgetown University has a foreign service department in full
operation, the worth of which this paper testified to when the project
was first announced. Recently twenty-five students of this department
were sent to South America to study trade conditions and they made
their headquarters first at Caracas, Venezuela. Now note what has
happened. These young people set up official and domestic housekeeping
at the United States consulate; they went about among the Venezuelans,
who found them likable, and soon the consulate became a rendezvous
for business people of Caracas. And there have been more sales of
household articles and of office equipment of various kinds in Caracas
and throughout Venezuela than the regular commercial letter, and the
traveling agent who rushes through the land have achieved in the past
five years. Moreover, there is correspondence relating to bigger orders
coming in to business houses which have been quick to communicate
with Georgetown University. Here is the sort of trade embassy we need
in South America and the world around. Train our young people to the
idea and the knowledge needed for foreign service, both commercial
and political. And then send them abroad to become known as well as
to know. We are the least well known of any great nation outside our
own borders, for we have been least well represented. It is time to
change all this and other higher schools might well follow Georgetown's
example.


STUDENT FRATERNIZATION

           [_From El Nuevo Diario, Caracas, June 20, 1920._]

Students, as a general rule, are free from prejudices and are exempt
from the burden of preconceived ideas which in most cases distort the
judgment of the individuals who purpose to learn from the bottom the
problems of a distinctive nationality. By reason of their temperament
they are optimists and like to view with dispassionate eyes the
phenomena of life. Therefore their impressions possess a high value of
sincerity, which contains perhaps more worth than the observations of
experience. The North American students who are going to Venezuela,
we are sure, will be able to carry back on their return a fresh and
pleasing impression of the noble Venezuelan land, and will be able to
understand that on the part of the students of Spanish America there
exists toward those of the United States nothing but warm sympathy and
a generous brotherhood.

It is to be desired that in years to come the University of Georgetown,
which now has given the example, and other North American Universities
will organize student trips such as this to other countries of the New
World, sending groups of students who for some months will live the
life of the Spanish Americans.

In turn, it is to be desired also that the Spanish American
Universities will inaugurate these student trips to the United States,
supervising them in a proper manner, and sending each year a certain
number of students, not to study in the cloister but to put themselves
in touch with the daily life of the country and the activity of the
masses.

For the Venezuelans it will be a matter of satisfaction--this visit
of the North American students--and with all confidence the society
of this country will endeavor to prove its worth in making their stay
agreeable to them, facilitating for them the necessary means whereby
their voyage may be in all respects profitable in order that a definite
judgment may be formed of the importance of our nation.

The trip organized by Dr. Sherwell in the form we have already noted,
seems to be a precedent of great importance for the relations between
the student societies of the two great portions of the continent, as it
must redound in the near future to the benefit of all.

To labor in this furrow signifies to water a fertile seed, a seed of
true progress and democracy, and whoever dedicates his efforts to this
end deserves the congratulations of the public.


LLEGADA DE LOS ESTUDIANTES AMERICANOS

               [_From El Nuevo Diario, June 27, 1920._]

_La Guaira_, 26 de junio,--Hoy, como estaba anunciado, llegaron en el
vapor _Caracas_, el notable profesor señor Sherwell, de la Universidad
de Georgetown, y el grupo de estudiantes americanos que vienen a
Caracas a pasar vacaciones y a practicar sus conocimientos de español.

Al vapor subieron a presentarle sus salutaciones varias comisiones: una
del Ministerio del Exterior, otra del Ministerio de Instrucción Pública
y otra de la Federación de Estudiantes Venezolanos.

En la Aduana, el señor M. A. Falcón Rojas ofreció varios brindis de
champaña a nombre de los nombrados Ministerios, y además en nombre del
señor Ministro de Hacienda.

Luego, el señor Sherwell, todos los estudiantes y las diversas
comisiones pasaron al hotel "La Alemania," de Macuto, donde se sirvió
un espléndido lunch.

Como a las cuatro de la tarde partieron todos en automóvil para Caracas.

En todos estos actos reinó la mayor cordialidad. Los estudiantes se
alojan en las mejores casas de pensión de esta ciudad.

El Profesor Sherwell, en sus palabras de respuesta a los cordiales
brindis de que fueron objeto tanto él como los estudiantes que lo
acompañan, expresó su profundo agradecimiento por la espléndida manera
con que se les ha recibido en Venezuela y manifestó que no le
sorprendían en manera alguna, las atenciones de que era objeto, pues
bien sabía que en este país así se demostraba la cordial y sincera
simpatía que se siente por los hijos de la gran República.

       *       *       *       *       *

En esta ciudad, desde su llegada, los distinguidos huéspedes son
objeto de múltiples atenciones; en especial el señor Sherwell, a
quien presentaron sus saludos en su alojamiento, numerosas, altas
personalidades, además de las comisiones nombradas por los Ministros
del Exterior, de Hacienda y de Instrucción Pública.

EL NUEVO DIARIO, de la manera más cordial presenta su saludo de
bienvenida al señor Sherwell y a los estudiantes que le acompañan, y
les desea todo género de satisfacciones en su estada entre nosotros.

Con el mayor placer publicamos de seguidas la nómina de los jóvenes
estudiantes que van a ser nuestros distinguidos huéspedes y a estrechar
con su presencia, los lazos de tradicional y fuerte amistad que ligan a
los pueblos de los Estados Unidos y de Venezuela.

Doctor Sherwell, Director; Walter Donnelly, James O'Neil, Paul Babbit,
George McKenna, Thomas Morris, John Heiler, David Schlesinger,
Tounsend, Frazee, Costello, Philip Sullivan, Chirieleison, Johnson,
Murphy, Fanning, Joseph Quinlan, Hopkins, J. Homer Butler.


EL PROFESOR SHERWELL

                 [_From El Universal, June 27, 1920._]

Desde ayer es huésped de Caracas el eminente hombre de Ciencias
norteamericano señor Guillermo A. Sherwell, Prosecretario del Segundo
Congreso Financiero Panamericano y Consultor jurídico del Consejo
Central Ejecutivo de la Alta Comisión Internacional.

Desde su desembarco en La Guaira el señor Sherwell ha sido objeto de
cordiales agasajos por parte del Gobierno de Venezuela y de los centros
más notables del país.

Por designación del Ministerio de Hacienda el señor Ramón Jiménez
Sánchez, Inspector General de Aduanas cumplimentó a su llegada al
Profesor Sherwell y le ofreció hospitalidad en nombre del Gobierno
Nacional.

MISION ESTUDIANTIL

Como estaba anunciado, ayer hizo su arribo a La Guaira el vapor
americano "Caracas," a bordo del cual llegaron el doctor Guillermo
Sherwell y el grupo de jóvenes estudiantes de la Universidad de
Georgetown, Estados Unidos.

A recibirlos al vecino puerto bajaron en automóvil, además de las
delegaciones del Ministerio de Relaciones Exteriores y del Consejo
Nacional de Instrucción Pública, una comisión especial de la Federación
de Estudiantes Venezolanos compuesta por los bachilleres Atilano
Carnevali (Presidente de la Asociación), Efraín Cayama Martínez, Miguel
Zúñiga, Jacinto Fombona, Rodolfo Moleiro, Germán de las Casas, Gonzalo
Carnevali y Eduardo Calcaño hijo. Después del saludo de bienvenida que
se les dió a bordo, los estudiantes americanos fueron invitados por sus
compañeros de Venezuela a un almuerzo en Macuto, de donde se dirigieron
a Caracas en las últimas horas de la tarde.

La visita de tan distinguidos elementos de la juventud norteamericana
tiene especial significación en estos momentos en que se acentúa un
acercamiento espiritual más estrecho entre los pueblos de América.

Igualmente el señor Manuel Segundo Sánchez, Director de la Biblioteca
Nacional, comisionado del Ministerio de Hacienda para atender al
distinguido huésped y facilitar sus labores en Caracas, le presentó sus
saludos a bordo del vapor americano.

El doctor Sherwell subió a Caracas acompañado de los señores Sánchez
y Jiménez Sánchez y ya en su domicilio fué visitado por el doctor
Alvarez Feo, Director de Aduanas en el Despacho de Hacienda, quien le
cumplimentó.

La Alta Comisión Internacional recibirá hoy á las 11½ a. m. al
distinguido huésped en su salón de sesiones. El señor Sherwell,
Profesor del Departamento Español de la Universidad de Georgetown, trae
encargo del Consejo Central Ejecutivo de la Alta Comisión Internacional
de presentar a la Sección Venezolana un cordial saludo y tratará con
ella diversos asuntos. Con este objeto la Comisión celebrará algunas
sesiones a las que asistirá el doctor Sherwell.

El distinguido huésped preside un grupo de estudiantes de la
Universidad de Georgetown cuya visita a Caracas propenderá a un
estrecho acercamiento estudiantil entre los dos países. Traen el
propósito de ofrendar una corona sobre la tumba del Libertador y otra
en la estatua de Washington.

Tal circunstancia hace más simpática la visita del profesor Sherwell a
Caracas donde se le preparan algunos homenajes.

Al presentar nuestros saludos al ilustre huésped hacemos los votos más
cordiales porque su misión en Venezuela tenga el más feliz éxito.

       *       *       *       *       *

EL UNIVERSAL se complace en presentar su salutación de bienvenida a los
estudiantes norteamericanos, cuya visita a Caracas contribuirá a hacer
más sólidos y eficaces los lazos intelectuales que unen a Venezuela con
la gran patria de Washington y a establecer un más activo intercambio
de ideas entre las juventudes estudiantiles de ambos países.

    DR. SHERWELL ARRIVES DELIGHTED WITH THE SITUATION WHICH HE
      MET IN VENEZUELA--WHAT MOST IMPRESSED HIM WAS THE HIGH
      CHARACTER OF THE GOVERNMENT AND ITS STRICT DEVOTION TO THE
      ACCOMPLISHMENT OF ITS DUTY, HIGHWAYS, RAILROADS, MONETARY
      SYSTEM, ETC.--FINDS ALSO THAT THE PEOPLE "IS ONE OF THE BEST
      TYPES OF HUMANITY THAT EXISTS IN THE WORLD."--ALL THESE
      TOPICS WILL BE TREATED IN THE THESES WHICH THE STUDENTS OF
      THE UNIVERSITY OF GEORGETOWN WILL PRESENT IN THEIR NEXT
      EXAMINATIONS TO OBTAIN THEIR DEGREES.

            [_From La Prensa, New York, August, 26, 1920._]

Washington, August 25th.--Dr. William A. Sherwell, Professor of
Spanish in the University of Georgetown and Expert Adviser in the High
Interamerican Commission, who has just returned from Venezuela with
the group of 18 students from the School of Foreign Service of the
University, has come from Venezuela impressed with the high class of
the Government employees which that country has, as well as with its
business men, where he was warmly welcomed by the same people, whom he
characterizes as "one of the best types of humanity which exists in the
world." The Professor was in charge of the students who are preparing
to enter the field of foreign trade, several of whom, he says, have
received offers from commercial houses, notwithstanding which they will
continue in their University studies until next June. Each student has
prepared an account or report of some one of the various phases of
industry--economic, industrial or commercial, of Venezuela. The coffee
and sugar industries, the petroleum exportation, and the operation
of the mines, the banking and monetary system, immigration laws,
education, public debt, are some of the topics which the students will
treat of in their reports.

Dr. Sherwell spoke of the great development which has taken place in
Venezuela, of the great extension of railroad work, which in many parts
crosses the mountains, and of the splendid automobile roads already
constructed and those planned for construction. In Venezuela there are
many automobiles, but orders will continue. Tractor machines are being
introduced in the farming sections and the cattle industry is taking on
a new impulse. New models are being introduced, especially from the
United States, and industry in the large is well advanced. There is
opportunity for further development of the cattle industry, according
to Dr. Sherwell, since there exist several districts not yet utilized
for this purpose.

Venezuela is the South American country nearest to the United States,
and the opportunity exists for a more extensive commerce between the
two countries. And yet, says Dr. Sherwell, there is no large passenger
and freight service between the two nations. He thinks that it is
necessary to remedy this need.

In going to Venezuela as the official representative of the High
Interamerican Commission and instructor of the students, the Doctor was
in touch with General Juan Vicente Gómez, President-Elect, the members
of the Cabinet and other prominent officials. The Minister of Public
Education gave a dinner in San Juan to the Sherwell party, General
Gómez and the President being present. One of the features of the visit
consisted of a trip in automobiles across the country in four days in
which they were able to inspect the places of industrial and historical
interest. They visited the sugar cane and coffee plantations; Valencia,
the most beautiful of tropical cities; La Victoria, famous in history
through having been the place where at the beginning of the last
century the Spanish forces were defeated by the Independents; and the
old farm of San Mateo, belonging to Bolívar, where Captain Ricaurte,
seeing that he was not able to hold the hill which he was defending
much longer, sent his men to the plain, and set fire to the park
of artillery when the Spanish arrived, all being blown up with the
explosion.

Dr. Roman Cardenas, Minister of the Interior and President of the High
Interamerican Commission, is a man--says Dr. Sherwell--for whom he
entertains the highest regard. He conferred with all the members of
the Cabinet, with some of whom he was in close contact, and he finds
that they, as well as the employees in the Government offices, are
competent and are steadfastly devoted to their work, without mingling
in politics. Dr. Sherwell spoke also of the wonderful painters that
Venezuela had produced, mentioning Señor Tito Salas, one of the great
painters of the day. There are in Venezuela many poets and writers of
high merit.

The money system, similar to the French, is functioning efficiently.
There is gold in abundance, says Dr. Sherwell; and during the war, when
most countries suspended payment, Venezuela continued paying its debts,
observing strict economy, and now has on deposit in the banks a large
quantity of gold.


GEORGETOWN STUDENTS WELCOMED IN VENEZUELA

             [_From Sunday Star, Washington, July, 1920._]

Prof. Guillermo A. Sherwell, professor of Spanish at Georgetown
University, and the eighteen students of the university's School of
Foreign Service, who left Washington a little more than a month ago
to gain first-hand and practical knowledge in Latin-American trade,
have been most cordially welcomed in Venezuela, both by officials of
the government and by the people there, according to a letter which
has just been received by a friend here. In addition to representing
Georgetown and acting as preceptor to the students, Dr. Sherwell also
went as representative of the inter-American high commission, of which
he is judicial expert.

"There is a tendency--very successful so far--to make Venezuela
independent in industrial matters," writes Dr. Sherwell, this in
connection with a visit he and his party have just paid to an
exposition of natural resources and industrial products.

"The highroads are excellent," he continues. "The appropriation for
public education has been doubled this year. The monetary system is
simple. Gold circulates freely."

Referring to the government departments, of which he has made a special
study, he says they "seem to have the right man in the right place."

Dr. Sherwell reports that just before he arrived in Caracas, the
capital, the commercial travelers' convention had been ratified. The
purpose of this treaty, which has now been agreed to between the United
States and six of the other American republics, is to facilitate trade
relations by simplifying the customs rules and regulations for the
admission into the various countries of commercial travelers with their
samples.

The convention now being signed with the different countries will do
away with many of the inconveniences to which commercial travelers
have been subjected, such as the payment in some countries of numerous
local taxes and fees. Under the new system a single license fee in each
country will be all that is required.

Another important feature is that there will be liberal customs
treatment of samples carried by the "drummer." Samples without
commercial value will be admitted duty free, while other samples will
be granted temporary free admission under bond for their re-exportation
within six months. Delay in the clearance of samples also will be
avoided. In addition to Venezuela, the other countries which have
signed the travelers' convention are Guatemala, Panama, Paraguay,
Salvador and Uruguay.

A convention for the arbitration of commercial disputes between the
Chamber of Commerce of Venezuela and the Chamber of Commerce of the
United States, also has just been signed, writes Dr. Sherwell. All
of this, he said, was "good news." Similar conventions between the
national trade bodies of this country and some of the other American
republics already are in operation and the results so far achieved are
said to be excellent. This leads interested trade officials to believe
that such machinery for the prompt and efficient treatment of disputes
which may arise between business men and concerns of various countries
will be set up one after another in the countries with which the United
States deals.


NOTAS DEPORTIVAS

EL MATCH DE BASE-BALL

                 [_From El Imparcial, July 18, 1920._]

Esta mañana, en los bonitos terrenos del Centro Atlético y con una
numerosa concurrencia, florida por el elemento femenil, efectuóse el
desafío concertado entre dos novenas de base ball, formadas la una por
los estudiantes norteamericanos de la Universidad de Georgetown y la
otra por discípulos del Colegio Salesiano de esta ciudad.

En verdad, la proporción atlética no era muy justa: los americanos
llevaban la ventaja en todo: tamaño, edad, fuerzas; pero, los muchachos
del Salesiano hicieron el mayor esfuerzo por quedar bien y a última
hora, cuando en el _inning_ final los de Georgetown se anotaron un
"chorro" de carreras que hacía aparecer la "pela" como vergonzosa, los
criollitos se rehicieron y metieron otras tantas, salvando el honor,
por lo menos _in partibus_.

[Illustration: TROPHY PRESENTED TO GEORGETOWN STUDENTS BY MINISTER OF
PUBLIC INSTRUCTION]

Entre éstos hay que consignar un aplauso para la tercera base de los
Salesianos, Franco Russo, que fué el héroe de la fiesta. El juego se
cargó desde el comienzo sobre tercera; en sus manos estuvo toda la
defensa y el muchacho se portó como un campeón, pues en sus manos
cayeron por lo menos nueve _outs_.

También estuvo muy activo y eficaz Coraíto. Y se distinguieron Maal,
Castellano, Pérez, López, Ravelo y Arratia (M).

De los americanos, recordaremos especialmente un foul-out por el
catcher Fanning y otro por la 3a. base Hopkins; una estupenda cogida,
corriendo y de espaldas, por el Short-Stop Frazee y todo el "trabajo"
del día por la primera base Joe Quinlan.

De una y otra parte batearon duro y ninguno de los dos pitchers llegó
completo al final.

Después del juego las novenas y algunos concurrentes fueron invitados
al Colegio y obsequiados allí por los R. R. P. P. Salesianos.
Hubo vivas en honor de la Universidad de Georgetown, a los que
correspondieron los americanos con hurras a los estudiantes venezolanos.

El Colegio Salesiano regaló a los de Georgetown una bola, la última
con que se jugó, con la siguiente inscripción: "Caracas--Venezuela--El
Colegio Salesiano a los estudiantes de Georgetown."

Fué, en todo, una fiesta de simpatía y de confraternidad, sin otro
estímulo mayor que el verdadero amor al deporte, puesto que, sabido
es, los jóvenes norteños no son profesionales del base ball, sino que
tienen la innata afición de los jóvenes de su país por la cultura
física.

Y este juego con los Salesianos ha sacudido el dormido entusiasmo
beisbolístico, con sus mañanas llenas de sol y alegres de mujeres,
pues ya se habla de un próximo encuentro en los mismos terrenos y
a beneficio de la Cruz Roja Venezolana, entre los estudiantes de
Georgetown y un team escogido entre los mejores jugadores de clubs
caraqueños extinguidos y en actividad, como _Samanes_, _Independencia_,
_Salesianos_, etc.

Así sea y tendremos un juego sensacional.

_Score_ por _innings_ del juego efectuado esta mañana entre los
Estudiantes de la Universidad de Georgetown y los alumnos del Colegio
Salesiano de Caracas:

  Estudiantes de Georgetown

  -------------------------------------------
  1 | 0 | 2 | 0 | 0 | 3 | 0 | 0 | 5--Total 11
  -------------------------------------------

  Salesianos

  ------------------------------------------
  0 | 1 | 0 | 0 | 2 | 0 | 0 | 1 | 4--Total 8
  ------------------------------------------

                                                              A. MATEUR.






    Transcriber's Notes:


    The table on p. 139 titled "Importation by Parcels Post" is
    incorrect by $2,000 in the column headed 1918. Unable to
    determine if the total is incorrect or if one of the individual
    items is understated by that amount.

    Silently corrected simple spelling, grammar, and typographical
    errors.

    Retained anachronistic and non-standard spellings as printed.

    Enclosed italics markup in _underscores_.

    Enclosed bold markup in =equals=.

    Enclosed fancy or unusual font markup in ~tildes~.





End of Project Gutenberg's Venezuela, an economic report, by Various