Key facts
- Venezuela and General Electric signed an agreement to improve the country's electrical service.
- The deal aims to add 1,000 MW in 24 months and over 5,000 MW in four years.
- The agreement follows legal reforms opening Venezuela's energy sector to foreign investment.
- The US has begun easing sanctions on Venezuela in response to these reforms.
Venezuela and US energy giant General Electric have signed an agreement to rebuild the country's electricity grid, a move aimed at improving electrical services and addressing frequent, lengthy power cuts. Delcy Rodríguez, Venezuela's interim president, announced the deal, describing it as a "historic step" to restore an essential service. The agreement seeks to recover 1,000 megawatts (MW) in 24 months and over 5,000 MW in four years, addressing an estimated deficit of 3,000 MW. Analysts attribute the persistent energy crisis to a lack of investment and maintenance in the nationalized power system, rather than solely drought as previously claimed by the government.
The deal with General Electric Vernova comes after legal reforms that have opened Venezuela's energy sector to foreign investment, a move that has prompted the US Treasury to begin easing sanctions against the country. This development is seen as part of a broader effort by Rodríguez to open Venezuela's economy to US investors. However, critics point out that key institutions remain under the control of her party, and significant changes are still needed for conditions conducive to free and fair democratic elections, according to US Secretary of State Marco Rubio.