By Marisela Luzardo and AFP | 2023-09-14

BEIJING/CARACAS -- Venezuelan President Nicolás Maduro concluded a weeklong visit to China on Thursday (September 14), aiming to reinvigorate relations with Beijing and secure financial assistance to address the profound economic crisis afflicting Venezuela.

While Maduro and Chinese President Xi Jinping have hailed the visit as an important step in bilateral relations, analysts say the visit underscores Maduro's pursuit of financial support and tangible economic outcomes ahead of next year's election.

The Venezuelan leader touched down in the southern tech hub Shenzhen September 8 and arrived in Beijing on Tuesday after a tour of Shanghai and other Chinese cities.

After meeting with Maduro on Wednesday, Xi announced an "upgrading of China-Venezuela relations to an all-weather strategic partnership," according to footage of the meeting published by state broadcaster CCTV.

Maduro is seeking Beijing's support to join the recently expanded BRICS group of emerging economies -- which currently includes Brazil, Russia, India, China and South Africa.

In an interview with Chinese state news agency Xinhua on September 9, Maduro said he aimed to secure "the entry of Venezuela into BRICS, with the support of China."

Beijing, Maduro said, could help to achieve the accession of "a country with the largest oil reserves in the world."

"The BRICS nations accelerate the de-dollarization of the world, the emergence of a new international financial system, of a new just economic order," he said.

BRICS agreed at their annual summit last month to admit six new full members starting January 1 -- Argentina, Ethiopia, Iran, Saudi Arabia, Egypt and the United Arab Emirates -- although there is some debate among politicians on whether Argentina will join the "China club."

Saudi Arabia has also been non-committal about the invitation.

Maduro polishing his image

Maduro's last visit to China was in September 2018. Since then, relations between Beijing and Caracas have cooled to their lowest point in decades due to mutual distrust, unfinished development projects and corruption on both sides, analysts say.

Notwithstanding these challenges, Maduro aims to showcase the significance of his visit and the bolstering of ties with Beijing as a pivotal development in Venezuelan politics, said US-based Venezuelan political analyst Jesús Seguías.

"He is seeking financial support," a seemingly evident objective, yet Maduro's goals extend well beyond mere financial assistance, Seguías told Entorno.

Throughout the visit, Maduro made concerted efforts to rehabilitate Venezuela's image as an untrustworthy partner, particularly in light of the corruption scandal that erupted within the state-owned Petróleos de Venezuela (PDVSA) last March.

PDVSA was under the leadership of one of the most prominent politicians closely aligned with the Maduro regime, the now conspicuously absent Tareck El Aissami, whose whereabouts have remained undisclosed since the scandal's emergence.

Preliminary reports estimated that at least $3 billion disappeared from PDVSA through parallel oil sales, although subsequent reports claimed that the amount could be even higher, according to El Nuevo Herald, a Miami-based newspaper.

The proceeds of the sales were allegedly pocketed by members of a corruption ring.

The scandal resulted in the arrest of approximately 63 individuals, with another 300 currently facing ongoing court proceedings.

During his visit to China, Maduro aimed to present himself as a dependable steward, offering assurances and guarantees to potential investors.

Regardless of the outcome of Maduro's visit, it will likely be presented as a "tool of intimidation aimed at persuading the United States to ease its sanctions against Venezuela," said another political analyst consulted by Entorno, who requested anonymity due to potential retaliation from the Venezuelan regime.

The United States has a longstanding reputation as a dependable partner in the oil sector, the analyst said. It is known for being a consistent payer and boasting the sector's top-notch workforce.

In contrast, the analyst said, China has predominantly leveraged the ongoing disputes and polarization within Venezuela to secure oil at reduced prices.

Debt trap

Beijing is Venezuela's main creditor and has close ties with the diplomatically isolated, inflation-ravaged socialist nation.

According to a recent investigation by Transparencia Venezuela, China lent Venezuela a staggering $62 billion between 2005 and 2016, accounting for 44% of China's total loans granted to Latin American countries.

This substantial amount highlights China's significant financial influence in the region and sheds light on Venezuela's reliance on foreign investments to sustain its economy.

"Between 2000 and 2019, close to 500 agreements were signed, as well as billion-dollar loans for the development of Venezuela, with poor results in some cases and unknown in others," the report said.

The loans financed infrastructure projects, such as power plants and highways, as well as the purchase of Chinese goods and services.

"Although the loans had the sale of prepaid oil as a shield and the commitment to repay them was assumed by PDVSA, these credits have been directed not only to the oil sector but have also been to ... projects in other areas, such as infrastructure, transportation, communications, electricity and agriculture, among others," added the Transparencia Venezuela report.

These loans have also contributed to Venezuela's growing debt burden, which is now estimated to exceed $150 billion.

In return for the loans, Venezuela is selling China up to 1 million barrels of oil per day through PDVSA, which is on the brink of collapse from under-investment and lack of maintenance.

The Latin American country's GDP fell 80% over the past decade due to the effect of its economic crisis, with citizens struggling to access basic necessities and millions having fled the country.

The fresh agreements forged during Maduro's recent trip to China may offer publicity the president can use in his reelection campaign and some small relief for Venezuela's economic crisis -- yet it is not clear the Venezuelan population will benefit from the country's closer ties to Beijing.