Before leaving Caracas, Chinese President Xi oversaw the signing of dozens of cooperative agreements with Venezuela. One of the deals includes a $4 billion loan from China, to support the Joint Chinese-Venezuela Fund, which will finance infrastructure and economic development across the South American country.
Chinese President Xi Jinping (2nd L) and his Venezuelan counterpart Nicolas Maduro (2nd R) attend the closing ceremony of the 13th meeting of the China-Venezuela High-Level Joint Commission in Caracas, capital of Venezuela, July 21, 2014. (Xinhua/Liu Jiansheng)
The money will be repaid by oil shipments to China. The 38 new agreements aim to strengthen economic ties between the two countries in industries such as energy, mining and transportation.
"Our relations are going into a comprehensive strategic area. China is willing to work with Venezuela to take advantage of this moment to promote bilateral ties and develop them at a higher level," Xi said.
"The funding as we all know will not put our country into heavy debt. It’s a financing that is backed by production and the supply of oil barrels. It provides a virtuous formula that allows for financing and development without creating heavy debt like in the old system, when Venezuela applied the neoliberal system," Venezuelan president Nicolas Maduro said.
