Mark Mobius has avoided investing in Venezuela for years. Why is he now ready to return?
Mark Mobius finds the Venezuelan market attractive, but sees several obstacles for foreign investors / Photo: markmobius.com
Mobius Emerging Opportunities Fund Managing Director Mark Mobius, who calls himself the "Indiana Jones of emerging market investing," said he is closely watching events in Venezuela and hopes to return to that market after the change in power.
Mobius invested in Venezuela while working at U.S. investment firm Franklin Templeton, but left the market shortly after Hugo Chavez came to power in the late 1990s and talked about nationalizing companies. "And it's a good thing we got out because the companies we owned collapsed badly. The situation was very bad," the famed investor said on the Masters in Business podcast in 2022.
Now that Nicolas Maduro has been ousted, investors should again keep an eye on Venezuela, Mobius wrote on his blog on Jan. 19. He himself considers this market attractive. As hyperinflation and devaluation of the national currency encouraged people to invest in the stock market, the main index of the stock exchange in Caracas showed "tremendous growth in bolivars," and in some periods provided returns in U.S. dollars as well, Mobius wrote.
"In the one month between the end of December 2025 and the beginning of January 2026, the return of the Venezuelan index in U.S. dollar terms was about 130%. Thus, even taking into account the weakening of the bolivar, the index more than doubled in dollar terms over this period"
In addition, during the same period, Venezuela's sovereign bonds and dollar-denominated bonds of the oil state company PDVSA rose sharply in anticipation of a change of power and easing of sanctions, the investor notes. As a result, he said, they were among the "best yielding distressed debt in the world." Venezuela's external liabilities, he estimates, total about $160 billion, of which about $145 billion comes from bonds and the rest from bilateral loans.
"Venezuelan debt holders may have reason for optimism. The potential easing of U.S. sanctions will allow the resumption of a long-stalled restructuring of PDVSA debt, which has been in default since 2017"
In addition, Donald Trump is now actively encouraging U.S. oil companies to enter the Venezuelan market, Mobius recalls. In the early 1990s, Venezuela accounted for 13% of U.S. imports of crude oil and petroleum products, second only to Saudi Arabia. But later sanctions and lower production collapsed Venezuelan oil exports to the US. Now, in order to restore exports, it is necessary first of all to increase production, the investor writes.
"We are watching developments closely and hope Venezuelan equities will once again become part of our portfolio"
But first, Mobius emphasizes, a number of obstacles must be overcome. He considers capital controls, which make it impossible to transfer money in and out of Venezuela, to be the main obstacle to investment in Venezuela. In addition, in order for foreign investors to enter the market, a custodial infrastructure must be created to store and account for their assets. So far, no foreign bank is keen to do this, given the risks, Mobius states.
This article was AI-translated and verified by a human editor
