Venezuela to repay China loans, ship more oil overseas
Diversify global markets to reduce US dependence
Venezuela will likely ship more oil to China and continue to pay its loans despite the negative influence of US sanctions on its oil production, the Venezuelan Ambassador to China told the Global Times.
Ivan Zerpa said in an exclusive interview on Thursday that Venezuela will continue to pay back China’s loans through oil.
He revealed that Venezuela intends to increase its oil production from 1 million barrels per day to 2.5 million barrels per day this year.
The South American country with abundant oil resources has plunged into a political crisis since January 23 when opposition leader Juan Guaido declared himself interim president as a challenge to the current president Nicolas Maduro, who took his second term in office earlier that month.
The political uncertainty has since drawn concerns over whether the country still has the ability to repay loans from China.
Zerpa told the Global Times that Venezuela has maintained working meetings and cooperation with relevant Chinese government organizations, including the Ministry of Foreign Affairs and National Development and Reform Commission, on joint projects.
Geng Shuang, spokesperson of China’s Foreign Ministry, said during a routine press conference on Friday that Venezuela is China’s important trading partner in Latin America.
Zerpa said they have taken actions to deal with the predicament, especially in the economic aspect, after the US slapped sanctions on Venezuela.
Zerpa added that they have suspended some contracts with the US, and have also “begun to demand payments in advance” for each ship carrying oil from a Venezuelan port to the US.
The US, the largest buyer of Venezuelan oil, recognized Guaido as Venezuela’s interim president and has imposed sanctions on American imports of Venezuelan oil as well as on Venezuela’s state-owned oil company PDVSA.
The Venezuelan embassy in China said the country has diversified its oil markets in recent years, especially to China and India, as a way of reducing its commercial dependence on the US government and its companies in the mid- and long-term. But difficulties still remain. Zerpa said US sanctions on Venezuela make it difficult to mobilize resources for the payment of services and scheduled maintenance in oil production as well as access to financing sources for the oil industry.
The US has frozen $10 billion in Venezuelan assets, said Zerpa.
Reuters reported that PDVSA has opened a new account in Russia following US sanctions.
Zerpa didn’t confirm with the Global Times the Reuters report. But he said the country has been able to “establish strategic alliances” with many countries that understand the situation.