Latin America Is Now China’s Backyard
(The Real Agenda) China has strongly positioned itself in Latin America, much like it has done everywhere else.
Whether it’s with military hardware,
economic aid, trade agreements or political ties, the Chinese are now
securing their future by expanding their power as far and wide as
possible.
One of the regions where China exercises
the most influence is Latin America, where its military and economic
power has bought it multiple allies; many of whom have abandoned the
traditional American dependence to side with a growing tide of Chinese
influence.
The latest example of such advancement
by the Chinese -although not new- is Venezuela. In full border crisis
with Colombia, President Nicolas Maduro, traveled this week to China and
Vietnam.
Beijing, after the visit on Tuesday, Beijing agreed to disburse a new
package of $5 billion dollars, which was agreed to in January. The
money will allegedly help to finance the operations of the Venezuelan
state oil company PDVSA.
Maduro announced the loan the same day
during the broadcast of his weekly program, In Touch with Maduro, which
aired via satellite from China. The liquidity crisis in public funds was
exacerbated by the fall in oil prices, the main source of foreign
exchange for Venezuela. Prior to these agreements, the debt of Caracas
with Beijing was of about 50 billion dollars.
Venezuela has seen its foreign exchange
earnings erode by 60% in less than a year, but Chinese cooperation
involves a paradox: much of the debt of the South American country with
the Asian is amortized with oil shipments.
With the decline of oil prices,
Venezuela could be forced to deliver increasing volumes of oil, without
receiving more money in return, which would in fact open a debt hole
that could exacerbate the crisis in the long run.
Maduro signed 14 new agreements Monday
after meeting with Chinese president, Xi Jinping. The implementation of a
set of a 10 year plan to increase Venezuelan oil production stands as
it was agreed previously. Indeed, Venezuela does not have a way out now.
It is debt servitude with China or complete and immediate collapse.
There were also agreements for the
production of tires in Venezuela, new apartment buildings and the
opening of the Confucius Cultural Institute for the teaching of Mandarin
in the Bolivarian country.
Currencies and food
Caracas and Beijing awarded a strategic
character to their relations since they signed the Framework of
Cooperation Agreement in 2001. Although in the heart of the alliance is
the source of investment by the Asian giant -especially because oil is
at the heart of the agreements- it is not clear how such agreements may
or may not help Venezuela during its economic collapse as well as ensure
its energy needs if most of the oil is being sent to China in exchange
for cash whose benefits are not visible to the average Venezuelan and
the economy.
Nicolas Maduro’s government increasingly entrusted their fate to investments and loans from Beijing.
The Venezuelan president’s visit
coincides with the celebrations in China of the 70th anniversary of the
victory against Japanese invaders during World War II.
The regime of President Xi Jinping has
granted unprecedented importance to the event, and the Venezuelan
government has not ceased to emphasize that it is the only South
American country who was present at the military parade.
“I think we can tell the Chinese people
and the Venezuelans that, 70 years after the victory of China, today our
peoples are closer than ever,” Maduro said.
In Vietnam, meanwhile, President Maduro
went looking for solutions that may solve his country’s dependence with
regard to food imports, which has been exposed to chronic shortages
experienced in the Venezuelan market.
During his two-day visit, the president
signed an agricultural production plan until 2018, and an another
agreement to increase bilateral trade to $1 billion annually.
Luis R. Miranda is an award-winning journalist and the founder and editor-in-chief at The Real Agenda.
His career spans over 18 years and almost every form of news media. His
articles include subjects such as environmentalism, Agenda 21, climate
change, geopolitics, globalisation, health, vaccines, food safety,
corporate control of governments, immigration and banking cartels, among
others. Luis has worked as a news reporter, on-air personality for Live
and Live-to-tape news programs. He has also worked as a script writer,
producer and co-producer on broadcast news. Read more about Luis.
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