The New China-Venezuela Partnership Is Challenging U.S. Hegemony (this didn’t age well)

A deepening strategic partnership between China and Venezuela — marked by over 600 cooperation projects across energy, infrastructure, agriculture, and technology — signals a broader realignment in Latin America’s geopolitical landscape.

Moving away from the era of large-scale loans, Beijing now favours targeted investments that strengthen its foothold without incurring the risks of financial overexposure. This shift positions Venezuela, under President Nicolas Maduro, as a key ally in China’s regional strategy, challenging longstanding US influence in the Caribbean.

Venezuela is no stranger to friendly ties with China, but things are now reaching new levels. Other deals include joint ventures to expand agricultural production, and China is also providing telecommunications technology and infrastructure upgrades, particularly in transport and energy. Additionally, the cooperation has extended into space, and into artificial intelligence technology, plus the naval and security realms, with reports of Chinese involvement in maritime surveillance systems, port infrastructure, and military training programs.

Venezuela’s location — bridging the Caribbean Sea and Atlantic trade routes — makes it a natural node in China’s Belt and Road Initiative. Beijing’s support for the country’s power grid and Special Economic Zones aligns with its recently announced $9.2 billion credit line to Latin America and the Caribbean, revealed during the May 2025 China-CELAC Forum.

NOW the raid makes sense.

Before 2015 China had become Venezuela’s dominant external financier through large, opaque oil-backed loans—estimates put total lending since 2007 around $50–$60 billion—yet after the oil-price collapse and Venezuela’s production decline Beijing largely stopped issuing new major loans and grew wary of extending fresh lines [1] [4] [7]. Multiple analysts and a 2025 academic review document that by and after 2015 Chinese policy banks and investors curtailed new lending because of perceived mismanagement in Caracas and the country’s diminishing capacity to service debt [3] [2].

2. Debt relief, grace periods and crude-in-kind repayments Rather than immediate legal enforcement or asset grabs, China pursued adjustments: grace periods, rollovers and arrangements that converted loan servicing into oil deliveries or escrow-controlled receipts, effectively turning many obligations into in-kind repayments [6] [8] [9]. Reuters and AidData reporting describe escrow arrangements and contractual off-take formulas stipulating hundreds of thousands of barrels per day to Chinese buyers until loans were serviced, while Beijing reportedly granted a grace period on about $19 billion of loans in 2020 [6] [5] [8].

People who lost everything 65 years ago might want their homes back. Most are dead by now. What happens to those homes in Cuba?

Same with Iran 45 years ago. Will a transition go well if people are told to get out of their homes where they’ve been living?

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