Maduro arrives in China in search of investments for Venezuela

Maduro arrives in China in search of investments for Venezuela

President Nicolás Maduro arrived in Beijing on Thursday to sign trade agreements with Venezuela's largest creditor, plunged into a deep crisis.

"We come with great expectations to give a special boost to the strategic relationship" with China "in all fields (?), Give a great boost to energy investments, economic investments, trade," said Maduro upon his arrival.

Dressed in a beret and liqui liqui -Venezuelan traditional clothes-, the president was received by Foreign Minister Wang Yi, and is scheduled to meet on Friday with his Chinese counterpart, Xi Jinping.

Maduro's visit was prepared by his vice president, Delcy Rodríguez, who is already back in Caracas after having traveled to Beijing on Monday night.

After his return, Rodriguez said he met with senior Chinese officials and reviewed 472 agreements in force, including loans payable in oil.

He also met with officials of the National Petroleum Corporation of China (CNPC) and energy and mining companies, a sector to which Caracas is betting to obtain liquidity before its sluggish oil industry.

According to the official Xinhua news agency, Maduro will remain in China until Sunday.

"China hopes that this visit will strengthen mutual political trust, and deepen cooperation between the two countries," Chinese Foreign Ministry spokesman Geng Shuang told a news conference.

"The Venezuelan government has recently implemented economic and financial reforms with a good social response, and we believe that a stable development of Venezuela is in the interest of all parties," he added.

Maduro put into effect three weeks ago an economic reform plan before the serious crisis, with a severe shortage of food and medicine and hyperinflation that could exceed 1,000,000%, according to the IMF.

– Credit –

The Asian giant has strong investments in oil and is the main financial partner of Venezuela, which has received Chinese loans for some 50,000 million dollars in the last decade, payable mainly with crude oil.

Venezuela still owes some 20,000 million dollars, whose terms of payment, made more flexible in 2016, could be on the table in this trip that had not been previously announced.

Maduro could return with a new loan of 5,000 million dollars and the six-month extension of the grace period for debt service, according to unofficial information quoted by the Venezuelan consultancy Ecoanalítica.

Also with a memorandum of understanding for the protection of Chinese investments. "This help from China, if materialized, gives you respite for a long time," the director of the Venezuelan consultancy firm Ecoanalítica, Asdrúbal Oliveros, said on Twitter.

This is a key issue in the face of the country's serious liquidity problems, with only 8,300 million dollars in international reserves and no access to external financing due to the financial sanctions of the United States.

Venezuela and its state oil company PDVSA, in addition, were declared in partial default in 2017 for delayed payments of debt bonds.

The vice president and the Venezuelan Minister of Economy and Finance, Simón Zerpa, met Wednesday with Zheng Jizhe, executive president of the Development Bank of China, which has granted most of the loans.

– Production drop –

Venezuela, with the largest oil reserves in the world and where crude accounts for 96% of revenues, faces an abrupt drop in production with 1,448,000 barrels per day in August, according to the Organization of Petroleum Producing Countries (OPEC).

It is the lowest level in 30 years and is far from the 3.2 million in 2008, which has prevented the OPEC partner from benefiting from the rebound in prices.

Caracas denounces a "financial blockade" of the United States, to which it sells a third of its oil production.

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