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 returns for 1904–6 show the revenues and expenditures to have been— A considerable part of the expenditure since 1903 consists of payments on account of foreign debts which Venezuela was compelled to satisfy. To meet these, taxes were increased wherever possible, thus increasing both sides of the budget beyond its normal for those years.

The public debt of Venezuela dates back to the War of Independence, when loans were raised in Europe for account of the united colonies of Colombia, Ecuador and Venezuela. The separation of the Colombian republic into its three original parts took place in 1830, and in 1834 the foreign debt contracted was divided among the three, Venezuela being charged with 28%, or £2,794,826, of which £906,430 were arrears of interest. Other items were afterwards added to liquidate other obligations than those included in the above, chiefly on account of the internal debt. Several conversions and compositions followed, interest being paid irregularly. In 1880–81 there was a consolidation and conversion of the republic’s foreign indebtedness through a new loan of £2,750,000 at 3%, and in 1896 a new loan of 50,000,000 bolívares (£1,980,198) for railway guarantees and other domestic obligations. In August 1904 these loans and arrears of interest brought the foreign debt up to £5,618,725, which in 1905 was converted into a “diplomatic” debt of £5,229,700 (3%). During these years Venezuela had been pursuing the dangerous policy of granting interest guarantees on the construction of railways by foreign corporations, which not only brought the government into conflict with them on account of defaulted payments, but also through disputed interpretations of contracts and alleged arbitrary acts on the part of government officials. In the civil wars the government was also held responsible for damages to these properties and for the mistreatment of foreigners residing in the country. Some of these claims brought Venezuela into conflict with the governments of Great Britain, Germany and Italy in 1903, and Venezuelan ports were blockaded and there was an enforced settlement of the claims (about £104,417), which were to be paid from 30% of the revenues of the La Guaira and Puerto Cabello custom-houses. This settlement was followed by an adjustment of all other claims, payment to be effected through the same channels. In 1908 (July 31) the total debt of Venezuela (according to official returns) consisted of the following items:— The currency of Venezuela is on a gold basis, the coinage of silver and nickel is restricted, and the state issues no paper notes. Foreign coins were formerly legal tender in the republic, but this has been changed by the exclusion of foreign silver coins and the acceptance of foreign gold coins as a commodity at a fixed value. Under the currency law of the 31st of March 1879, the thousandth part of a kilogramme of gold was made the monetary unit and was called a bolívar, in honour of the Venezuelan liberator. The denominations provided for by this law are— These denominations are still in use except the silver 20-centimos piece, which was replaced by one of 25 céntimos in 1891, The silver 5-bolívar piece is usually known as a “dollar,” and is equivalent to 48 pence, or 96 cents U.S. gold. The old “peso” is no longer used except in accounts, and 1 is reckoned at 4 bolívares, being sometimes described as a “soft” dollar. Silver and nickel are legal tender for 50 and 20 bolívares respectively. Paper currency is issued by the banks of Venezuela, Carácas and Maracaibo under the provisions of a general banking law, and their notes, although not legal tender, are everywhere accepted at their face value.

The metric weights and measures have been officially adopted by Venezuela, but the old Spanish units are still popularly used throughout the country.

History.—The coast of Venezuela was the first part of the American mainland sighted by Columbus, who, during his third voyage in 1498, entered the Gulf of Paria and sailed along the coast of the delta of the Orinoco. In the following year a much greater extent of coast was traced out by Alonzo de Ojeda, who was accompanied by the more celebrated Amerigo Vespucci. In 1550 the territory was erected into the captain-generalcy of Carácas, and it remained under Spanish rule till the early part of the 19th century. During this period negro slaves were introduced; but less attention was given by the Spaniards to this region than to other parts of Spanish America, which were known to be rich in the precious metals.

In 1810 Venezuela rose against the Spanish yoke, and on the 14th of July 1811 the independence of the territory was proclaimed. A war ensued which lasted for upwards of ten years and the principal events of which are described under (q.v.), a native of Carácas and the leading spirit of the revolt. It was not till the 30th of March 1845 that the independence of the republic was recognized by Spain in the treaty of Madrid. Shortly after the battle of Carabobo (June 24, 1821), by which the power of Spain in this part of the world was broken, Venezuela was united with the federal state of Colombia, which embraced the present Colombia and Ecuador; but the Venezuelans were averse to the Confederation, and an agitation was set on foot in the autumn of 1829 which resulted in the issue of a decree (December 8) by General Paez dissolving the union, and declaring Venezuela a sovereign and independent state. The following years were marked by recurring attempts at revolution, but on the whole Venezuela during the period 1836–1846 was less disturbed than the neighbouring republic owing to the dominating influence of General Paez, who during the whole of that time exercised practically dictatorial power. In 1849 a successful revolution broke out and Paez was driven out of the country. The author of his expulsion, General Jose Tadeo Monagas, had in 1847 been nominated* like so many of his predecessors, to the presidency by Paez, but he was able to win the support of the army and assert his independence of his patron. Paez raised the standard of revolt, but Monagas was completely victorious. For ten years, amidst continual civil war, Monagas was supreme. The chief political incident of his rule was a decree abolishing slavery in 1854. General Juan Jose Falcon, after some years of civil war and confusion, maintained himself at the head of affairs from 1863 to 1868. In 1864 he divided Venezuela into twenty states and formed them into a Federal republic. The twenty parties whose struggles had caused so much strife and bloodshed were the Unionists, who desired a centralized government, and the Federalists, who preferred a federation of semi-autonomous provinces. The latter now triumphed. A revolt headed by Monagas broke out in 1868, and Falcon had. to fly the country. In the following year Antonio Guzman Blanco succeeded in making himself dictator, after a long series of battles in which he was victorious over the Unionists.

For two decades after the close of these revolutionary troubles in 1870 the supreme power in Venezuela was, for all practical purposes, in the hands of Guzman Blanco. He evaded the clause in the constitution prohibiting the election of a president for successive terms of office by invariably arranging for the nomination of some adherent of his own as chief of the executive, arid then pulling the strings behind this figurehead. The tenure of the presidential office was for two years, and at every alternate election Guzman Blanco was declared to be duly and legally chosen to fill the post of chief magistrate of the republic. In 1889 there was an open revolt against the dictatorial system so long in vogue; and President Rojas Paul, Blanco’s locum tenens, was forced to flee the country and take refuge in the Dutch colony of Curaçoa. A scene of riot and disorder was enacted in the Venezuelan capital Statues of Blanco, which had been erected in various places in the city of Carácas, were broken by the mob, and wherever a portrait of the dictator was found it was torn to pieces. No follower of the Blanco regime was safe. An election was held and General Andueza Palacios was nominated president. A movement was set on foot for the reform of the constitution, the principal objects of this agitation being to prolong the presidential term to four years, to give Congress the right to choose the president of the republic, and to amend certain sections concerning the rights of persons taking part in armed insurrection arising out of political issues. All might have gone well for President Palacios had he not supposed that this extension of the presidential, period might be made to apply to himself.