News / Americas

China Provides $4B to Venezuela in Exchange for Oil

  • Chinese President Xi Jinping attends a meeting with Venezuelan President Nicolas Maduro (not pictured) at Miraflores Palace in Caracas, July 20, 2014.
  • Venezuelan President Nicolas Maduro, left,  presents Chinese President Xi Jinping with a replica of the sword of national hero Simon Bolivar during a ceremony at the National Pantheon in Caracas, July 20, 2014.
  • A Venezuelan child welcomes China's President Xi Jinping at Simon Bolivar airport, in Caracas, July 20, 2014.
  • Chinese President Xi Jinping, second from left, gestures as he is welcomed by his Venezuelan counterpart Nicolas Maduro at the Simon Bolivar airport, in Caracas, July 20, 2014.
  • Chinese President Xi Jinping, left, and Venezuelan President Nicolas Maduro, second from left, attend a ceremony at the tomb of the national hero Simon Bolivar at the National Pantheon in Caracas, July 20, 2014.
  • Chinese President Xi Jinping attends a meeting with Venezuelan President Nicolas Maduro, not pictured, at Miraflores Palace in Caracas, July 20, 2014.

The China-Venezuela Alliance

Reuters

China will provide Venezuela with a new $4 billion credit line under an agreement signed on Monday, with the money to be repaid by oil shipments from OPEC member Venezuela.

The deal was inked during a 24-hour visit to Venezuela by Chinese President Xi Jinping, who is on a tour of Latin America.

The money will go into the Joint Chinese-Venezuela Fund, which focuses on infrastructure and economic development in the South American country.

President Nicolas Maduro said the Venezuelan government would also put $1 billion into the fund, though officials later said that amount was in fact $2 billion.

The government said this weekend the fund has about $40 billion in it, though it was not clear if that included the amounts covered by Monday's agreement.

Officials said the credit would be repaid by shipments of about 100,000 barrels per day of crude oil and products.

No other terms were given.

Under the leadership of late socialist President Hugo Chavez, Venezuela vastly expanded its use of loan-for-oil agreements with China, which helped ease stretched state finances while also improving the cash flow of state oil company PDVSA.

Maduro, who won election last year after Chavez died from cancer, has continued that policy.

“It's a virtuous [financing] formula which does not create onerous debts,” Maduro said. “We've reached the point of no return in a deep relationship with China.”

PDVSA said Venezuela is now sending about 524,000 bpd to China, a figure expected to rise to one million bpd by 2016.

Bilateral trade between Venezuela and China has soared to $19.2 billion annually, compared with just $183 million in 1998, the year Chavez came to power, officials said.

Chinese entities participate in transport, housing, education, electricity, communication and vehicle-assembly projects in Venezuela.

“The Chinese economy continues along solid development lines and is in fine condition to keep growing,” said Xi, who was flying on to Cuba later on Monday. “China will be a cooperation partner for all countries of the world like Venezuela.”

Among 38 accords signed on Monday was also a memorandum of understanding for China's EximBank to lend $1 billion to PDVSA, an agreement for mineral exploration, the purchase of 1,500 Chinese busses and the creation of a new cement factory.

Venezuelan opposition politicians say much of China's loans in the last 15 years have been wasted amid corruption, inefficiency and lack of transparency in public funds.

“If we are the country with the world's biggest oil reserves, why do we have to indebt ourselves with China?” asked one opposition leader, Henrique Capriles, via Twitter, demanding information and accountability on a series of China-funded projects.  

You May Like

N. Korea Sentences American to 6 Years Hard Labor

Matthew Miller's brief trial Sunday comes two weeks after 24-year old Miller and two other American detainees appealed to the US government to help free them More

Pakistan Rejects Afghan Criticism of 480-kilometer Border Trench

Military spokesman tells VOA the project is part of administrative and security measures taken to secure the mountainous border with Afghanistan More

Photogallery Typhoon Kalmaegi Makes Landfall in Philippines

Storm makes landfall late Sunday, cutting power and communications lines and forcing people to flee to higher ground More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Scotland Independence Bid Stokes Global Interesti
X
Henry Ridgwell
September 12, 2014 8:35 PM
The people of Scotland are preparing to vote on whether to become independent and break away from the rest of Britain, in a referendum being watched carefully in many other countries. Some see it as a risky experiment; while others hope a successful vote for independence might energize their own separatist demands. Foreign immigrants to Scotland have a front row seat for the vote. VOA’s Henry Ridgwell spoke to some of them in Edinburgh.
Video

Video Scotland Independence Bid Stokes Global Interest

The people of Scotland are preparing to vote on whether to become independent and break away from the rest of Britain, in a referendum being watched carefully in many other countries. Some see it as a risky experiment; while others hope a successful vote for independence might energize their own separatist demands. Foreign immigrants to Scotland have a front row seat for the vote. VOA’s Henry Ridgwell spoke to some of them in Edinburgh.
Video

Video Washington DC Mural Artists Help Beautify City

Like many cities, Washington has a graffiti problem. Buildings and homes, especially in low-income neighborhoods, are often targets of illegal artwork. But as we hear from VOA’s Julie Taboh, officials in the nation's capital have come up with an innovative program that uses the talents of local artists to beautify the city.
Video

Video Palestinians Turn to Rebuilding Gaza

After almost two months of conflict in Gaza, Palestinians are preparing to rebuild the isolated Mediterranean enclave with assistance from abroad. Meanwhile, an international human rights group has found that Israel likely violated international laws of war during some of its attacks on Gaza. Zlatica Hoke has more.
Video

Video US Muslim Leaders Condemn Islamic State

Leaders of America's Muslim community are condemning the violent extremism of the Islamic State group in Iraq and Syria. The U.S. Muslim leaders say militants are exploiting their faith in a failed effort to justify violent extremism. VOA correspondent Meredith Buel reports.
Video

Video Middle Eastern Church Leaders Highlight Christians’ Plight

Patriarchs of Eastern Rite churches came to Washington this week to draw attention to the attacks against Christians in Syria, Iraq and elsewhere in the Middle East. VOA’s religion correspondent Jerome Socolovsky has more.
Video

Video Americans' Reaction Mixed on Obama Strategy for Islamic State Militants

President Barack Obama’s televised speech on how the United States plans to “degrade and destroy” the group known as the Islamic State reached a prime-time audience of millions. And it came as Americans appear more willing to embrace a bolder, tougher approach to foreign policy. VOA producer Katherine Gypson and reporter Jeff Seldin have this report from Washington.
Video

Video Authorities Allege LA Fashion Industry-Cartel Ties

U.S. officials say they have broken up crime rings that funneled tens of millions of dollars from Mexican drug cartels through fashion businesses in Los Angeles. Mike O'Sullivan reports that authorities announced nine arrests, as 1,000 law enforcement agents fanned out through the city on Wednesday.
Video

Video Bedouin Woman Runs Successful Business in Palestinian City

A Bedouin woman is breaking social taboos by running a successful vacation resort in the Palestinian town of Jericho. Bedouins are a sub-group of Arabs known for their semi-nomadic lifestyle. Zlatica Hoke says the resort in the West Bank's Jordan Valley is a model of success for women in the region.


Carnage and mayhem are part of daily life in northern Nigeria, the result of a terror campaign by the Islamist group Boko Haram. Fears are growing that Nigeria’s government may not know how to counter it, and may be making things worse. More

AppleAndroid

More Americas News

Powerful Hurricane Threatens Mexico's Baja California

US forecasters have downgraded Odile to strong Category 3 storm, with top sustained winds of 205 kilometers per hour
More

Hard-hitting Films Tackle Homelessness at Toronto Festival

'Time Out of Mind,' 'Shelter,' and 'Heaven Knows What' all focus on characters struggling with homelessness, addiction on the streets of New York
More

After Tax Reform Triumph, Chile's President Faces Rockier Road

'Honeymoon' may be over for Michelle Bachelet as protests rise and economy, security outlook worsen
More

Mexico: Texas Governor's Border Deployment Politically Motivated

Rick Perry says he is sending up to 1,000 troops to Mexican border to deter criminal activity caused by drug cartels
More

Video Authorities Allege Ties Between LA Fashion Industry, Cartels

Officials say the LA fashion industry has attracted drug money since the Mexican government tightened restrictions on cash transfers
More

Brazil Confirms Amazon Deforestation Sped Up in 2013

Destruction of world's largest rainforest accelerated last year with a 29 percent spike, figures confirm a reversal in gains seen since 2009
More