September 25, 2016

Venezuela: Will China pull the plug on Maduro?

Long-term readersof my blog are familiar with the many times China has loaned money to Venezuela. Back in 2012, I posted that El Nuevo Herald reported

Venezuela’s increasingly dependent on China’s financing and direct investments to the tune of US$80 billion. In exchange, China is playing a greater part on Venezuela’s strategic decision making regarding especially the oil-producing Orinoco area.

Clearly by now Venezuela (which by now can’t even pay its oil drillers) won’t pay the billions of dollars back:

China Rethinks Its Alliance With Reeling Venezuela. Concerns about debt repayment and safety of expatriates prompt emergency meetings between Chinese envoy and state companies

These days, confronted with a pile of unpaid bills and increasing security headaches for its citizens and companies in Venezuela, China appears to be recalculating its alliance with the nation where it has made about $60 billion in loans.

As a result, Venezuela may not get meaningful freshloans or investment from China, raising the possibility of deeper cutbacks and shortages in the oil-rich nation or a default on more than $110 billion in government and state-oil-company bonds.

There are also security concerns, as more Chinese Venezuelans and expats are being kidnapped and extorted by local gangs (likely including the government-armed colectivos).

It’s not clear how many expats are living in Venezuela at the moment. Eight years ago, Daniel Duquenal reported on the large number of Chinese traveling on his flight from Paris who were rushed through customs upon arrival in Caracas.

21st Century Socialist Bolivarian Revolutions need money, and China is aware that the Venezuela regime can not survive without it – now the Chinese may be agreeable to negotiating with the opposition for a possible regime change.

Read the rest here

About FaustaW 7 Articles
Fausta Wertz was born and raised in Puerto Rico. She’s a graduate of the University of Georgia and has an MBA from Fairleigh Dickinson University. She blogs at Fausta’s blog on American and Latin American politics, news, current events and culture.

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