Saturday, March 8, 2014

Venezuela: Update--Chinese Funding for Caracas Should Be a Wake-Up Call for Washington

According to The Latin American Tribune, it should come as no surprise that Vice President Rafael Ramírez said on Friday (March 7) that Venezuela would receive a new $5 billion tranche of funding this month from China.

The new disbursement will be received by the Joint Chinese-Venezuela Fund and allow Venezuela to maintain its pace of investment in large infrastructure projects, he told a press conference.

Rafael Darío Ramírez Carreño is president of the Venezuelan state-owned petroleum company, PDVSA, known as CITGO in the US.

Ramírez was appointed to the presidency of PDVSA in July 2002 by former leftist Venezuelan President Hugo Chávez.

Ramírez served also as the founding president of Enagas, the national regulatory agency that was set up to be responsible for establishing the national plan for natural gas production and distribution.

COMMENT: Ramírez, who also serves as Venezuela’s oil minister, said the agreement was reached after his meeting last week in Beijing with Chinese Vice President Li Yuanchao and other authorities.

Now, what is not known to the US or anyone else is what sweet-heart deal has been negotiated in Beijing that will benefit China.

The Joint Chinese-Venezuela Fund, created in 2007, finances projects in Venezuela and receives contributions from the China Development Bank and Venezuela’s National Development Fund (FONDEN). 

It should come as new surprise to political observers that China is one of the primary sources of external financing for the Venezuelan government, which interestingly provides the PRC with more than 500,000 barrels of oil per day!

Ramirez also made a stopover in Russia, saying he and President Vladimir Putin met and agreed on the terms for a $2 billion loan from Russian state-owned energy titan, Rosneft, to Venezuelan state-owned oil giant PDVSA.

Russia and China both are strategic allies of leftist-led Venezuela, supplying the South American country with weapons and technology and helping fund its energy and industrial development interests.

I have often said that one of the innate deficiencies in the US Government's global strategy is that when it comes to China and Russia, the American government plans in weeks and months while our two economic adversaries plan in decades and yes, even centuries.

As a young Marine in the 1960s, I remember all too well the words of former General-Secretary of the Communist Party of the Soviet Union Nikita Krushchev (1894-1971) who memorably said: 

"I once said, 'We will bury you [the US]' and I got into trouble for it. Of course, "we will not bury you with a shovel. Your own working class will bury you."

The late General-Secretary perhaps could actually see into the future.