Venezuela’s crisis-hit economy has been given room to breathe as the oil-exporting country reaches a deal with its main financier China to improve the conditions of an oil-for-loans deal, according to top officials that spoke to Reuters.
Venezuelan Economy Vice-President, Miguel Perez, said that all conditions, including loan time frames, investment amounts, and non-financial aspects, had been improved.
China has lent some $50b to Venezuela under the arrangement, and investors are watching closely to see if Beijing will help President Nicolas Maduro’s socialist government as it struggles with recession, shortages, and reduced oil revenue.
Better terms with China would be hugely useful for Venezuela, given that low oil prices mean the South American country would be required to send more barrels to meet its obligations.
“This will give the country important oxygen to go forward,” added Perez, a former industry association leader who became economy czar in February, replacing a hard-line socialist who lasted only a month.
Both sides have “agreed to add more flexibility to strengthen financing cooperation,” Chinese Foreign Ministry spokesman, Hong Lei, was quoted by The Global Times at a press briefing.
Despite having the world’s largest crude reserves, Venezuela’s economy contracted 5.7% last year, its second year of recession, Al Jazeera wrote.