The Russian and Venezuelan governments signed an agreement on Wednesday confirming a ten-year payment plan for Venezuela’s 3.15 billion dollar debt to Russia (WP). Venezuelan payments to the Russian government will remain nominal during the first six years, allowing for economic stabilization and development, reported the Russian Finance Ministry. A day later, Geng Shuang, the Chinese Foreign Ministry spokesperson, told a news briefing that the Chinese government will not extend debt relief to Venezuela. However, Shuang said the Chinese government, to which the Venezuelan government owes 23 billion dollars, was confident that the China-Venezuela financing plan would continue successfully (Reuters).
Due to the Venezuelan economy’s current state, which economists call “close to insolvency,” the value of Venezuelan bonds dropped vastly within the last year (NYT). Venezuelan President Nicolás Maduro announced his plan on November 2 to “refinance and restructure” the Venezuelan external debt through renegotiating repayment terms with foreign investors (BBC). The BBC estimates the Venezuelan total external debt to amount as much as 140 billion dollars. Beyond the Venezuelan government’s debt to Chinese and Russian investors, it also owes one billion dollars to Brazil and five billion dollars to multilateral lenders (FT).
Tags: China, Global Economy, Russia, Venezuela, Debt