MercoPress. South Atlantic News Agency

Venezuela seeks support from Russia and China amid economic crisis

Venezuela’s economic crisis is worsening, with inflation expected to reach nearly 200% in 2025

Venezuela is turning to its geopolitical allies, Russia and China, to counter a deepening economic crisis, as the South American nation faces dwindling oil revenues, runaway inflation, and a severe currency devaluation.

President Nicolás Maduro secured a series of energy and economic cooperation agreements with Russian President Vladimir Putin during a visit to Moscow this week. “The trade balance between Moscow and Caracas increased by 64% in 2024 and has the potential to continue growing,” Putin emphasized during the meeting. Venezuelan state media described the new agreements as a “strategic partnership” covering hydrocarbons, finance, aviation, technology, pharmaceuticals, military cooperation, and security, and will remain in effect for the next 10 years.

Venezuela’s Foreign Minister Yván Gil hailed the agreement as a historic milestone, stating, “This is the first time a Latin American country has signed a treaty of this magnitude with Russia.” Kremlin spokesman Dmitri Peskov also highlighted the significance of the agreement, calling it a “substantial and highly important document.”

In a parallel effort, Venezuelan Vice President Delcy Rodríguez visited Shanghai, where she met with executives from China Petroleum Corporation (CNPC) to discuss potential investments in the country's struggling oil sector. CNPC, which had previously withdrawn from Venezuela in 2020, is now reconsidering its role in the country.

China has historically been a key financial backer of Venezuela, providing billions in loans during the Hugo Chávez era. However, many of those projects were plagued by corruption and mismanagement, leading to a cooling of Chinese investment in recent years. Despite this, Beijing has maintained diplomatic support for Caracas.

Venezuela’s economic crisis is worsening, with inflation expected to reach nearly 200% in 2025, according to Asdrúbal Oliveros, director of the consultancy Ecoanalítica. The official exchange rate has plummeted, with the dollar now trading at 91 bolívares, up from 69 at the end of March. The country has lost a significant portion of its oil revenue following the departure of Chevron, which had been granted a special license to operate in the country under the administration of U.S. President Joe Biden.

“Venezuela is facing a new period of significant economic deterioration, and the main victims will be those who depend on bolívar salaries: elderly citizens and public employees,” Oliveros warned in an interview with Unión Radio.

The agreements with Russia and China come as Venezuela seeks to stabilize its collapsing economy without the support of U.S. companies. While the government promotes the diversification of non-oil exports, the country remains highly dependent on foreign investment to maintain its oil production.