China to extend lifeline to Venezuela’s Maduro
China is set to prop up the crash-strapped Venezuelan economy during President Nicolas Maduro’s four-day visit to Beijing.
China is expected to increase its commitment to propping up the crash-strapped Venezuelan economy during President Nicolas Maduro’s four-day visit to Beijing that ends tomorrow.
There are expectations Venezuela will receive another $6.9 billion in loans from China that could be repaid with a combination of cash and oil as Mr Maduro bids to stave off an economic collapse.
In a televised address before flying out of Caracas on Thursday, Mr Maduro said the visit was “very necessary, very opportune and full of great expectations”. He said Venezuela was going to “improve, broaden and deepen relations with this great world power” and expected to return to Venezuela “with big achievements”.
Chinese Foreign Ministry spokesman Geng Shuang said Mr Maduro was visiting at the invitation of President Xi Jinping.
“China is confident that the visit will further enhance political mutual trust and deepen mutually beneficial and friendly co-operation between the two countries in various fields,” Mr Geng said.
He said the Venezuelan government had been “actively promoting economic and financial reform with a good social response” and that “a stable Venezuelan development is in the interests of all parties.”
Mr Maduro’s visit to the Chinese capital comes at a time when the oil-rich nation is on the verge of collapse following the fall in the world price of crude over the past four years and economic mismanagement.
The country’s economy is suffered severe hyperinflation, which has forced hundreds of thousands of Venezuelans to leave the country.
The trip to China will be his first outside the country since Mr Maduro was reportedly targeted by exploding drones during a military parade in Caracas early last month.
China has already lent more than $65bn to Venezuela over the past decade, loans which the country has largely repaid with oil shipments. Reports are that the socialist-led country, which still owes China $28bn, will also be asking for extensions on its existing loans as well as further financial assistance.
Mr Maduro’s government recently massively devalued its currency as part of a package of measures aimed at trying to stem the country’s hyperinflation.
The visit will not please Washington, which has had poor relations with Venezuela for many years under Maduro and his predecessor, Hugo Chavez, who was staunchly anti-American.
US President Donald Trump reportedly discussed military intervention in the country last year but was convinced by his aides that it would be a mistake.
The New York Times has reported a group of rogue military officials from the country have visited Washington several times and met members of the Trump administration. Mr Maduro has survived several assassination attempts from opponents in the country’s military.
Preparations for his visit, and potential further financial assistance, have been made this week by Vice-President Delcy Rodriguez, who has been in Beijing for the past few days and has met his Chinese counterpart, Wang Qishan.
Once one of the world’s largest oil-producing nations, Venezuela’s crude oil production is at some of the lowest levels in decades. Poor management by oil giant PDFSA has exacerbated the impact of falling oil prices.
China’s nationalistic Global Times newspaper this week described the Latin American country as “an important friend, as well as one of the major economic partners of China in Latin America”. The editorial noted that the visit would “inevitable capture worldwide attention” in the wake of “constant rumours saying that the US wants to conduct a military intervention in Venezuela”.
The paper said China had no plans to “play a geopolitical game in Latin America, the ‘so-called US backyard’.”
But it said “some say that the Maduro government would have long ago collapsed if not for the economic support of China.”
The editorial pointed out that the risk of China’s lending to the country had been exaggerated.
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