Venezuela renews $6.3b China credit line, seeks Russia financing

CARACAS (REUTERS) - Venezuela is renewing a US$5 billion (S$6.3 billion) credit line with China that will be repaid in oil and other fuels and is negotiating a financing deal with Russia for an undisclosed sum, the country's economy vice president said on Friday.

Rafael Ramirez said Venezuelan officials had visited China and Russia and held meetings with officials, including Russian President Vladimir Putin, to arrange new financing deals.

The Joint Chinese-Venezuela Fund, which focuses on infrastructure and economic development in the South American country, will receive US$5 billion from China as part of a renewal of one of three tranches, Mr Ramirez said.

"This is extraordinary for us because it lets us maintain the intensity of our investments," he said, adding that the resources should be available this month.

Venezuela received a separate US$5 billion transfer late last year linked to a different tranche of the agreement.

Mr Ramirez declined to provide details on terms of the agreement with Russia or the amounts in question, though he said it had been approved in a meeting with Mr Putin.

"The respective finance ministers have received instructions ... (a delegation) will be traveling to Moscow this week," he said.

Under the leadership of late socialist leader Hugo Chavez, Venezuela vastly expanded its use of loan-for-oil agreements with China, which helped ease stretched state finances while also improving the cash flow of state oil company PDVSA.

Mr Ramirez did not provide details of how much Venezuela owes China under existing financing arrangements. But he said total shipments to pay for outstanding loans amount to less than 250,000 barrels per day (bpd).

PDVSA in its 2012 annual report said it shipped 451,000 bpd to pay commitments under the Joint Chinese-Venezuela Fund and a separate credit line known as the Large Volume Fund.

Join ST's Telegram channel and get the latest breaking news delivered to you.