Why is China’s Support to Venezuela Essential for the Recovery of the Bolivarian Economy?

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Venezuelan President Nicolas Maduro visited China last week, where he met with his Chinese counterpart. Venezuelan economist Tony Boza saidk that the two countries’ partnership is based and that Beijing’s support is fundamental for the recovery of the Venezuelan economy.

During his visit, Maduro participated in the closing of the 16th meeting of the Joint Commission between the two countries, in Beijing, where he announced the signing of 28 new agreements between the two countries in the areas of oil, energy, mining (gold and iron), technologies, education, security, defense and health.

Tony Boza, an adviser to the Venezuelan government, believes that Beijing and Caracas are good partners because their policies focus on mutual advantage and non-interference.

“The economic ties between China and Venezuela are key elements for recovery, but also security and state policies. The policy of both countries is one of diplomacy for peace and self-determination of peoples,” said Boza, anchor of the “Boza con Valdez” program on the Venezolana de Televisión state channel.

A Belt, A Rope

The economist recalls that Caracas decided to join the Chinese initiative called One Belt, One Road, a global investment project of the Asian country in infrastructure, to which Uruguay has also associated.

The initiative is part of the New Silk Road project, considered by some economists as the “China Marshall Plan.”

However, for Boza, the two projects cannot be compared. The interlocutor recalled that the United States used the Marshall Plan (1947) to “take advantage of the European countries that had been devastated after World War II, and not all nations received resources, but received transnational corporations North American “, because it was a loan that gave return.

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According to Boza, Beijing has a way of establishing relations totally different from the one of the USA.

“China is not like the United States, it is not an aggressive power, it has not invaded any country, it has not imposed conditions in coercive terms, but its relation, as the President has said, [following] the doctrine of the common destiny of mankind, implies respect for sovereignty,” said the economist.

Paying off debt with oil

The analyst points out that China is the main creditor of Venezuela. Thus, in the past 10 years, Beijing has approved credits to Caracas worth more than 50 billion dollars, of which Venezuela still owes $21 billion, according to data from the Chinese Fund cited by the national press.

In turn, Venezuela pays China with its oil production. In 2007, Caracas promised it would send 100,000 barrels a day as payment, and in 2016 the monthly payment was 500,000 barrels, according to official figures.

The two countries also agreed that China will pay Venezuela any excess oil it purchases above the quotas established to collect Caracas’ debt.

The Venezuelan leader said that his goal was to increase oil production in the coming years with China’s support to deliver to Beijing a million barrels a day.

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