Los Che have also lost key trio David Silva, David Villa and Juan Mata over the last 18 months, but they have started the new season in good form, winning their opening three matches before playing out a 2-2 draw with Barca at the Mestalla last night.
Former Liverpool manager Benitez watched that game and the Spaniard, who coached Valencia between 2001-04 and led them to two Primera Division titles, was impressed with what he saw from Unai Emery's men.
"After seeing the game against Barcelona I have no doubt that Valencia can compete with the best. Unai is doing a great job and I think that they could reach the level of the teams who have bigger budgets. We will have to see, but they are taking the steps," said Benitez in Marca.