Introduction
During a state visit to the People’s Republic of China (PRC) in September 2023, Venezuelan President Nicolás Maduro met President Xi Jinping, and both agreed to strengthen the relationship between their countries by establishing seven sub-commissions to elevate it to the level of an “all-weather strategic partnership.” This is the culmination of a relationship that began with President Hugo Chávez’s first visit to Beijing in 1999, the very first year of his presidency.
Chávez’s first visit went well beyond friendly diplomacy, since Venezuela’s president and the then-president of China, Jiang Zemin, signed 15 cooperation and commercial agreements. This was followed by President Jiang’s visit to Venezuela in 2001. Trade between the two countries in 1998 amounted to a paltry US$182.8 million, which would grow a hundred-fold by the second decade of the 21st century.
In his 1999 visit Chávez described China as “a true model and example of mutual respect,” adding that “we [in Venezuela] have developed an autonomous foreign policy, independent from any world power, and in that, we resemble China” (Díaz 2019). Subsequently, high officials from both governments would visit each other’s country, developing a commercial and political relationship that has grown stronger ever since.
While Hugo Chávez was president of Venezuela, he visited China in 2001, 2004, 2006, 2008, and 2009, and was central to strategic agreements with China in 2010, 2011, and 2012. President Maduro has done so in 2013, 2015, 2018, 2021, and 2023. For their part, Chinese leaders have also visited Venezuela. After Jiang Zemin’s 2001 visit, Xi Jinping (then vice-president) visited in 2009. President Hu Jintao (who had planned a visit for 2010, interrupted it due to an earthquake in China) visited Venezuela in 2013, and Xi Jinping visited as president in 2014.
This article endeavors to chart the evolution of the relationship between Bolivarian Venezuela and the People’s Republic of China and its significance for Latin America as a whole.
As a consummate strategist, Hugo Chávez understood earlier than other Latin American left-wing leaders the significance and weight of China in world politics and economics, and especially, the rising Asian power’s commitment to building a multipolar world. An avid reader, and endowed with a formidable intellect, Chávez was also aware not only of the significance of the 1949 Chinese Revolution and of the leading role played by Mao Zedong, but also of the importance of Deng Xiaoping’s economic reform for bringing about China’s extraordinary economic development. He knew that given the affinities between the Bolivarian and Chinese revolutions: China was a friendly ally.
Chávez communicated this to his host, China’s President Jiang Zemin, and to the people of China during his first visit to China in October 1999. In the course of the trip he visited Mao’s Mausoleum and declared, “I have been a Maoist all my life.” The 1999 visit to China was part of a tour seeking markets for Venezuelan oil and potential commercial partners to help break the overwhelming economic dominance of the United States over Venezuela. The tour included visits to Hong Kong (China’s Special Administrative Region), Japan, South Korea, Malaysia, Singapore, and the Philippines.
Though the tour produced positive results in all the Asian countries, the outcome of Chávez’s visit to China far exceeded expectations. To the eight existing cooperation agreements between Venezuela and China signed since Chávez came to office in February 1999, his visit in October produced seven more, covering the fields of energy, oil, investment, diplomacy, academia, and credits to purchase agricultural machinery.
Chávez combined his strategic political audacity in promulgating an anti-neoliberal constitution in 1999 with a vigorously independent foreign policy that sought to establish strong links of every kind with the People’s Republic of China, as an alternative to Venezuela’s heavy dependence on the US. The Comandante knew that Washington had activated all its resources in order to oust him and eliminate his government—perceived by the US as an abhorrent anomaly. Chávez’s political courage is even more impressive considering that in 1999 Latin America, with the exception of Cuba, was a sea of neoliberalism.
Washington’s relations with China had begun to sour because in 1996 Clinton had authorized a visit by the leader of the Taiwan region of China, Lee Teng-hui, reversing a 15-year-old policy against granting visas to leaders of the Taiwan region of China. Worse, in May 1999, NATO during its war against Yugoslavia had “accidentally” bombed the Chinese embassy in Belgrade, killing three Chinese journalists. Venezuela and China agreed to comprehensive levels of cooperation even though the United States was an important trading partner for both countries, and they knew this cooperation would be viewed with hostility in Washington.
Hugo Chávez opened the gates to relations with the People’s Republic of China for the rest of Latin America. After Chávez was elected in 1999, the second left-wing government of the “pink tide” to win office was four years later in Brazil, where Lula would be inaugurated in January 2003. Between 1999 and 2003, Chávez’s government faced intense US-led destabilization, including right-wing street violence, a worldwide media demonization campaign, national protests, economic sabotage, a short-lived coup d’état and a 64-day oil lockout that came close to bringing about Venezuela’s economic collapse. Though fully aware of this context, President Jiang Zemin paid a formal visit to Venezuela in 2001. During this visit the two countries decided to establish a “strategic association for shared development,” and set up a High-Level Chinese–Venezuelan Commission.
The Bolivarian and Chinese Revolutions
When Hugo Chávez visited Mao’s Mausoleum during his very first trip to the People’s Republic of China and declared that he had been a Maoist all his life, he was not seeking to ingratiate himself with his Chinese hosts. In more than one way, he meant it.
In fact, Hugo Chávez regularly cited Mao’s speeches, phrases and teachings, and undoubtedly had real political admiration not only for Mao but also for the Chinese Revolution. In a conversation with Ignacio Ramonet, Chávez said he had read Mao extensively, including Mao’s Little Red Book that was circulating among clandestine circles of young military officers in the early 1970s. From this book, Chávez learned that there should be no separation between the army and the people, since the bases of any victory reside in the civic–military alliance (Ramonet 2016). This principle was to become a trademark of the Bolivarian Revolution. At the time, the 17-year-old Hugo Chávez was a cadet in Venezuela’s Military Academy. 1
For Chávez, as for the Chinese Revolution during its early days, the commune was the road to socialism. For that reason, he popularized the reading of Inside a People’s Commune: Report from Chiliying, a book by Li Chu and Chieh-yun Tien (Chu and Tien 2012). Chávez’s emphasis on the commune stems from his concept of the Communal State, based on local communes that in turn are based on communal councils, and whose purpose and objective is to ensure mass grassroots participation in local matters. In this way, the declaration in the 1999 Bolivarian Constitution that Venezuela is a participatory democracy is to be realized. There are almost 50,000 registered communes in Venezuela, and the stated aim of President Maduro’s government is to expand them (Sheck 2022).
Faced with Chávez’s defiance in its “backyard,” US imperialism unleashed a brutal policy of sanctions against Venezuela, aimed at encircling and asphyxiating the country’s economy. In this situation, President Chávez adopted the concept of total war, or people’s war, as the most effective means to resist and confront a possible military aggression—something that was floated openly under Trump. This strategic concept, whose precondition in modern times is the building of a socialist state, was adopted by the Chinese Revolution under the leadership of Mao Zedong. In Venezuela, its tangible manifestation is the civic-military alliance, and crucially, the People’s Militias. Chávez’s concept of total war was also influenced by his knowledge of the political and military strategies that Bolívar used to bring about independence, subjects on which Chávez possessed unparalleled erudition (Rojas 2021, 651–652).
Chávez admired and praised the socialist path of China because this path, like the Bolivarian Revolution, was rooted in the country’s own national traditions and culture; it was based on endogenous forces, and was the heroic creation of China’s own people. The Venezuelan leader felt a particular affinity with the Chinese Revolution because of its ability to adapt socialist construction to the country’s national peculiarities, and crucially, he identified with the Chinese socialist experience because of its objective of building a multipolar world (Todo Chávez 2009).
The Bolivarian Revolution is unique in that the socialist transformation of the state, economy, and society is being carried out peacefully and through the ballot box, that is, without a revolutionary assault on the bourgeois state. A salient feature is the fact that “sectors of the state are working actively to dismantle and dissolve the old state apparatus by devolving power to local organs capable of constituting a dual power” (Ciccarello-Maher 2007). Although the revolutionary transformation is avowedly being carried out according to the tenets of Marxism, the iconic figure of Simón Bolívar is a fundamental source of inspiration, education and mobilization for the working class and its allies.
The Bolivarian government has never tried to abolish the market, but instead has sought both to bring it under the overall state strategy of socialist development and to minimize its potentially iniquitous effects on social development. A crucial dimension here is the government’s efforts to raise living standards, to eradicate poverty, and to enhance all the conditions needed to increase the people’s material, physical and cultural wellbeing. Despite the highly deleterious consequences of the comprehensive US sanctions on Venezuela, the housing program, for example, has built over 4.8 million houses for working-class families ( Ultimas Noticias 2023a). The national budget approved for 2024 allocated 77.4% of its outlays to social spending ( Ultimas Noticias 2023b), similar to the 77.1% allocated for 2023 ( Telesur 2022).
In addition, the Bolivarian government has courted private and foreign investment in nationalized industries, including the oil industry, and is in the process of establishing Special Economic Zones. It has also encouraged and supported the creation of thousands of small and medium-sized private, cooperative, and communally owned productive enterprises (Dominguez 2023, 22). Despite the huge differences, particularly in their political origins and complexion, key features of Venezuela’s economic framework resemble those of the economic reform undertaken in China by Deng Xiaoping. These features include the use of the market under the conditions of the transition to socialism.
To balance market, plan and state-guided development is not easy in any circumstances, let alone in those of Venezuela, whose economy has been, and in some respects still is, “a capitalist, rentier and dependent system, where large and very important public enterprises, national and foreign private sector, as well as small socialist-owned enterprises in their various forms coexist.” Consequently, a key task is “to substantially increase the efficiency of economic development under the control of the State, taking advantage of all the resources and mechanisms compatible with our socialist principles.” This requires creating joint ventures between state and foreign private capital to obtain financing and investment for basic industries, without which it would not be possible to sustain economic growth (Faría 2022).
In other words, what is being constructed is “socialism with Venezuelan characteristics,” which in Venezuela’s national conditions aims at emulating experiences such as those of China and Vietnam. In this regard Jesus Faría, legislator and President of the Economy and Finance Commission of Venezuela’s National Assembly, argues persuasively that in a revolutionary state led by socialists, the market must be harnessed as an instrument able to generate wealth that translates into the people’s welfare.
Bolivarian Venezuela’s commitment to helping build a multipolar world, fits with President Chávez’s view of the need to bring about a dialogue of civilizations, a view that is a core principle of Venezuela’s foreign policy. Hence, a week-long Latin American and Caribbean Encounter on the Dialogue of Civilizations was held in Caracas in November 2001 with the participation, among others, of representatives from Mexico and Iran, former Algerian President Ahmed Ben Bella, and the president of the General Conference of UNESCO. President Chávez gave the keynote speech (Henderson 2001).
The Venezuelan leader’s view in this case stemmed from his understanding of Venezuelan society, as expressed in a 2002 decree declaring 12 October as Indigenous Resistance Day,
destined to recognise our Americanist self-affirmation for the unity, cultural and human diversity, vindicating both the indigenous peoples of America and the contributions of the African, Asian and European people and cultures in shaping our nationality, in the spirit of dialogue of civilizations, for peace and justice. (Venezuela Reports 2021)
Seeking to foster “a spirit of cooperative international engagement,” President Chávez put forward this vision at the UN General Assembly discussion on terrorism in September 2002 (United Nations General Assembly 2002). At the very same meeting, Jiaxuan Tang, China’s Minister for Foreign Affairs, argued for the need to develop “increasing mutual confidence through dialogue and promoting common security through cooperation” (United Nations General Assembly 2002). This has become a cornerstone policy both for China and for Venezuela, whose position was reaffirmed by President Maduro at the 73rd session of the UN General Assembly:
As president of the Non-Aligned Movement, Venezuela raises the flags of dialogue among civilizations. As president of the Non-Aligned Movement, Venezuela permanently promotes and practices the political and international dialogue, the solution to international conflicts through dialogue, the understanding and the pacific uses of politics and not force. (Venezuela Ministry of Communications 2018)
At the first Liangzhu Forum held on 6 January 2023 in Hangzhou (Zhejang province) and addressing the topic “Implementing the Global Civilization Initiative, Promoting Exchanges and Mutual Learning between Civilizations,” President Xi Jinping encouraged all participants “to promote a civilization view that features equality, mutual learning, dialogue and mutual accommodation, thus helping different civilizations live in harmony and reinforce one another” ( China Daily 2023a). For China, he stated, “the world is a community of civilizations composed of a variety of civilizations, with the characteristics of diversity. Civilizations should be equal, not superior or inferior. The differences between civilizations need to be resolved through dialogue rather than conflict” ( China Daily 2023b).
In short, the Bolivarian government from the very beginning has shared the foreign policy approach of the People’s Republic of China, and ever since 1999 the close relationship between Venezuela and China has not only strengthened this commonality, but seen a stronger collaboration between the two countries in a myriad of multilateral institutions.
Additionally, Chinese–Venezuelan collaboration is taking place within the context of a number of global collaborative initiatives such as the Belt and Road Initiative (Feingold 2023) and the BRICS ( India Times 2023). Both these initiatives are continually expanding, and one of their salient features is that economic interaction between the participants is conducted using their own currencies, not the dollar. This process of de-dollarization, through creating “a fairer, more equal global trade [and] financial system” (Daye 2023), counters US weaponization of its hitherto dominant currency.
Building a multipolar world has a definite anti-imperialist dynamic, something which is understood perfectly in key imperialist institutions such as the US government, the US State Department, the US Department of Defense, and the Council on Foreign Relations. The views and actions of these institutions—echoed and supported by their European accomplices—confirm their hostility to both China and Venezuela.
Venezuela and China: More than Two Decades of Growing Partnership
The 15 agreements signed in 1999 between the Bolivarian Republic of Venezuela and the People’s Republic of China were followed, after President Jiang Zemin’s visit to Caracas in 2001, by the two countries agreeing to establish a “strategic association for shared development.” This was coupled with the establishment of a High-Level Chinese–Venezuelan Commission, showing with the benefit of hindsight that the political leadership of the two nations grasped the strategic significance of the relationship.
In September 2000 a Joint Trade Commission met, giving the Venezuelan government an opportunity to issue a communiqué supporting China’s entry into the World Trade Organization, recognizing the People’s Republic of China as the only legitimate representative of the Chinese people, and reaffirming support for the principle of “one country, two systems” as a means of reunification.
President Chávez made a second visit to China in July 2001, with the objective of consolidating the ten-year strategic partnership (2001–2011) that had been signed with President Jiang Zemin the same year. During his visit Chávez stressed the affinity between the Bolivarian and Chinese revolutions, noting especially the fact that both nations had entered the 21st century without having accepted any imposition from anybody. Venezuela and China were determining their own destinies through their own political, social and economic models, based on their own rich cultures, and furthermore, both countries were promoting international relations based on justice, the self-determination of nations, and respect for the sovereignty of all nations.
When this occurred in 2001 there was no inkling, despite acute crisis and growing social mobilization, that Latin America would be soon engulfed by a “pink tide” of left-wing governments. To mention the most important developments, Lula was elected President of Brazil in October 2002, while Nestor Kirchner became President of Argentina in 2003. Evo Morales would be elected President of Bolivia in December 2005, and Rafael Correa as President of Ecuador in 2006.
A degree of political stability returned to Venezuela after Hugo Chávez won a recall referendum in August 2004. Chávez visited China again in November 2004, in a very different context since this was after the short-lived coup in April 2002 and the US-led 64-day oil lockout in 2003. Brazil sent 520,000 barrels of gasoline to help relieve the acute shortages caused by the lockout, along with 20 oil experts to restart Venezuela’s oil industry, sabotaged by opposition engineers (Mendible Zurita 2006, 18–19). 2
When new Chinese President Hu Jintao received Chávez in 2004, China’s investment in Venezuela was already its largest in South America. Cooperation agreements were signed on energy and mining, technical assistance, infrastructure, agricultural machinery, the military and housing. In 2005 Venezuela would establish a vice-ministry for Asia, the Middle East, and Oceania.
During Chávez’s fourth visit to China in 2006, another Joint High-Level Commission meeting was held in Beijing. This led to the signing of 31 new cooperation agreements and the establishment of a Venezuelan Consulate in Shanghai. In the course of this visit the two countries signed 12 energy cooperation agreements, providing for joint ventures in the Venezuelan oil industry through their respective state oil companies, and for the training of 195 Venezuelans in the use of perforation drills. Venezuela agreed to increase its oil supplies to China, to participate in the joint building of 18 oil tankers, to jointly explore the possibility of producing ethanol in Venezuela, and to use Chinese solar panel technology in an energy-saving project (PDVSA 3 2006). This was followed in 2007 by the sixth meeting of the Joint High-Level Commission, when 45 more cooperation agreements were signed involving areas such as energy, finances, communications, technology, infrastructure, mining, agriculture, education and tourism.
Chávez visited China for the fifth time in September 2008, leading to the renewal of the Venezuela–China Joint Fund, with a commitment of US$6 billion. In October of that year, as a result of the growing cooperation between the two countries, Venezuela successfully launched its first-ever satellite, “Simón Bolívar 1.” The satellite was built by the China Great Wall Industry Corporation under an agreement signed in November 2005, was operated by the Bolivarian Agency for Space Activities, and offered, free of charge, modern telecommunications such as broadband internet, high-definition television and mobile phone services to the whole of Latin America (Barbosa 2008). At the time (29 October 2008), France 24 reported in a sour-grapes mood, “The space lab—the pride of Hugo Chávez’s regime—is located at the heart of an air force base. In front of the first security checkpoint, a placard warns visitors: ‘Socialist fatherland or death’” (Freeland 2008). Venezuela-China cooperation under the space program would lead to Venezuela launching two more satellites, the 1st Venezuelan Remote Sensing Satellite (VSSR-1) in 2012 and the VSSR-2 in 2017. 4 The two were named Francisco de Miranda and Antonio José de Sucre, respectively, after 19th-century leaders of Venezuelan and Latin American independence.
Hugo Chávez paid his sixth and last visit to China in April 2009, to strengthen the strategic alliance with China. When he met President Hu Jintao he asserted, “Nobody can deny the world’s center of gravity has moved to Beijing.” This trip had been preceded by a visit to Venezuela by then-Vice-President Xi Jinping in February of that year. Both countries agreed that by 2013 Venezuela would increase its supply of oil to China from 380,000 barrels a day to 1 million, for which a Venezuelan oil refinery would be constructed on Chinese territory, and that they would establish a binational shipping company to transport the crude. In December 2009, after the eighth meeting of the Joint High-Level Commission had been held in Caracas, 29 more agreements were signed, involving the areas of energy, science, technology, aerospace, economics, trade and social issues (Briceño-Ruiz and Molina-Medina 2020, 150).
In 2010, 48 agreements were signed by China and Venezuela, with the year also seeing the China Development Bank issue a large-scale loan to Venezuela of US$20 billion. The ninth meeting of the Joint High-Level Commission led to the signing of 39 agreements in areas such as mining, science and technology, industry, commerce, cultural exchanges, agrarian developments, communes, and housing. The commission held its tenth meeting in Caracas in November 2011, focusing on a review of progress on joint projects. A Venezuelan Parliamentary Friendship Group with China was also established.
Between 1999 and 2011 a total of 430 Venezuela–China agreements were signed, of which 171 were cooperation projects on energy and mining, agriculture, science and technology, infrastructure, industry, aerospace, culture, social and economic matters, and trade issues. The agreements also concerned projects in areas such as iron and aluminum, food production, housing, health and medical supplies, electric power, and the importation of buses and other vehicles.
From 2012 China provided financial assistance to Venezuela’s massive housing program, and as a result of the 11th meeting of the Joint High-Level Commission that convened in Beijing, cooperation expanded to include mining (certification, exploration, and the geological prospecting of mineral reserves), oil (supply platforms), finances (a Joint Fund with PDVSA), electricity, and academia.
The premature death of Hugo Chávez on 5 March 2013 was received by the United States and Venezuela’s opposition as a golden opportunity to put an end to the Bolivarian Revolution. Thus, the opposition contested Nicolás Maduro’s electoral victory in April 2013, following this up with a six-month wave of street violence in 2014. The violence was complemented by economic sabotage that created acute shortages of basic items of daily consumption, primarily food. In 2015 US President Obama declared Venezuela “an unusual and extraordinary threat to the national security … of the United States” (White House 2009), opening the way for unilateral coercive measures (aka “sanctions”). He also expanded US energy output through fracking, deliberately causing oil prices to plummet to less than US$30 a barrel (Dominguez 2019). One of the worst crises in the history of the Venezuelan republic followed.
The US-led aggression against Venezuela dealt immense damage to the country’s economy, taking it to the verge of collapse, a condition in which it remained from 2014 to 2020 (Dominguez 2023, 11–14). 5 Nevertheless, the support and cooperation from the People’s Republic of China never weakened. Quite the opposite; the solidarity was maintained, especially during the very hard years of the COVID-19 pandemic period, when the US blockade of Venezuela was at its most intense. US President Donald Trump also declared the 2018 Venezuelan election fraudulent and the victor, President Maduro, illegitimate, leading the US to recognize self-proclaimed “interim president” Juan Guaidó, who engaged in massive corruption with US-controlled Venezuelan assets.
The 12th and 13th meetings of the Joint High-Level Commission took place in September 2013 and July 2014 respectively. The first of these meetings, held in China, was attended by President Maduro, and the latter, held in Caracas, was attended by now-President Xi Jinping. The two countries signed more agreements, covering the same areas as at previous meetings.
President Maduro traveled to China in January and September 2015, on the latter occasion taking part in the 15th meeting of the Joint High-Level Commission. The 11 new agreements signed there included the Venezuela–China Joint Development Plan (2015–2025), the Framework Agreement for Cooperation in Special Economic Zones in Venezuela, and the Framework Agreement for a Special Financial Facility, of up to US$5 billion.
By 2016, China and Venezuela had developed over 18 oil production projects with a total investment of about US$5 billion. China had approved financing for projects worth about US$700 million in the Orinoco Mining Arc, a region rich in gold, coltan, diamonds, iron, bauxite, and other strategic minerals. By February 2017, China and Venezuela had signed a total of 790 cooperation agreements in strategic areas (PSUV 6 2017). Within the context of the 16th meeting of the Joint High-Level Commission held in Beijing, President Maduro during his tenth visit to China signed 28 more cooperation agreements in the usual areas of oil, science and technology, mining, economics, security and health (Venezuela Ministry of Foreign Relations 2018). President Maduro characterized this visit as “historic” because he signed a Memorandum of Understanding with China “for cooperation on the Belt and Road Initiative” (PRNewswire 2018).
Between 2000 and 2018 Venezuela borrowed more than US$67 billion from Chinese institutions, about 48% of the total of China’s loans to the whole of Latin America. According to specialists, this was the largest total of credits granted by China to any country in the world (Brandt, Carlos, and Piña 2019, 9). The borrowings have led some pundits to “theorize” that paradoxically for Venezuela’s quest to build a multipolar world, closer and growing economic relations with China as a counterweight to Washington has made Venezuela increasingly dependent on Chinese investment, technological support and economic assistance, which “could very well lead to the replacement of an old dependency (United States) with a new one (China)” (Briceño-Ruiz and Molina-Medina 2020, 162). The continued strengthening of the Venezuela-China and China-Latin America relationships belies these fallacies.
Between 2008 and 2020 Venezuela accounted for 29.6% of the contracted projects undertaken by China in Latin America, considerably more than the figures for Brazil (13.9%), Argentina (10.7%), Ecuador (7.5%), Mexico (6.7%), Colombia (6.2%), and Peru (4.2%). Confirming the strong nature of the China–Venezuela relationship, between 2010 and 2018 China has constructed numerous hospitals, roads, bridges, ports, airports, schools, hydropower projects, and housing projects in the South American country (Guo 2023, 1–26). By May 2023, Venezuela’s relation to China had been upgraded from “strategic partnership” to “comprehensive strategic partnership.”
In September 2023, on the occasion of a visit by President Maduro to Beijing at the invitation of China’s President Xi Jinping, the relationship between the People’s Republic of China and the Bolivarian Republic of Venezuela was further upgraded to an “all-weather strategic partnership.” The event was described as follows: “The China-Venezuela connection is a key milestone in the shifting global political and economic landscape. In a changing world order, this partnership has the potential to provide Venezuela with economic prosperity, stability, as well as greater autonomy” (Farah 2023).
President Maduro and President Xi Jinping, along with their respective governments, see their relationship as a central component of building a multipolar world. As the Venezuelan Ministry of Foreign Relations has observed, they place great value on
the important role of the China-CELAC Forum (CCF) in promoting China-Latin America and the Caribbean (LAC) relations. Xi Jinping and Maduro are willing to strengthen communications and coordination in matters related to the CCF, so as to promote a stable and lasting China-LAC relations in the new era, characterized by equality, mutual benefit, innovation, openness and well-being for their peoples. The Chinese side appreciate[s] Venezuela’s role in LAC affairs, as well as its active stance in favour of the continued development of cooperation between the region and China. (Venezuela Ministry of Foreign Relations 2023)
The evolution of Venezuela–China relations, mapped out above, has taken place in the context of both the severe decline of the United States and the meteoric economic rise of the People’s Republic of China to being Latin America’s main trading partner. These two points are examined below.
The Decline of the United States
The rise of Chávez and Chavismo can be found in the specifics of the decline and eventual collapse of the oil-dependent, parasitic, Venezuelan political economy whose terminal manifestation was the 1989 social explosion known as the Caracazo. In turn, the fall of Venezuela’s ancien régime occurred at the end of Latin America’s lost decade, in a context dominated by the economic and political decline of US imperialism. In 1960, US GDP represented 40% of the world’s total; by 2000—two years after the election of Chávez—it had fallen to 30% (Bhutada 2021).
The United States has sought to counteract its decline by building up its military capabilities, thus massively increasing its defense budget from US$47.35 billion in 1960 to US$320.09 billion in 2000 (and to US$800.67 billion in 2021), that is, a staggering increase of over 600% by 2000 (and 1,700% by 2021) (Macrotrends 2023a). US military muscle has been flexed primarily in wars in the Middle East, presented as a “global war on terror” that began in 2001 with US military action against Afghanistan. This was followed by the war against Iraq in 2003, the war against Syria (depicted as “targeted operations to defeat ISIS”), the brutal military bombardment of Libya leading to the assassination of Muammar Gaddafi in 2011, and vigorous military support for Saudi Arabia in the civil war in Yemen.
The cost of 20 years of the US “war on terror” has thus far been more than 900,000 people killed directly, and about 4 million who have died as an indirect consequence. Some 38 million people have been displaced, and the cost to the US taxpayer has been an estimated US$8,000 billion. The US is currently conducting counterterror activities in 85 countries (Watson Institute 2023), and it has about 800 costly military bases around the world.
Given excessive spending (plus poor economic performance) by the US in the last few decades, US governments have addressed these severe weaknesses of the country’s economy by borrowing money through the issuing of Treasury bonds, leading to a dramatic increase in the US public debt. In 1960 this stood at US$286 billion, by 1980 it had gone up to US$908 billion, and by 2000 it had reached US$5,764 billion. That is, between 1960 and 1980 US public debt hovered around 30–40% of GDP, by 2000 it was around 60% of GDP, by 2020 it had reached over 100% of GDP, and by 2023 it was 120% of GDP (Srinivasan 2023). Currently US public debt is over US$33 trillion (the world’s largest by volume), and exceeds the country’s GDP of US$27 trillion by a staggering US$6 trillion (US Debt Clock 2023), equivalent to the combined GDP of all the countries in Latin America and the Caribbean (Macrotrends 2023b).
The World Bank considers that countries with a debt-to-GDP ratio above 77% for a prolonged period experience significant slowdowns in economic growth (Caner, Grennes, and Koehler-Geib 2011). Between 1961 and 2017, average annual economic growth in the US was barely above 2%; in 1970 it was 4.4%, indicating a long-term downward trend in the years since (Topforeignstocks 2017). Further, the US banking system triggered a massive world recession in 2008, and was then hit by the COVID-19 pandemic before it could fully recover (Coghlan, McCorkell, and Hinkley 2018). 7
As a consequence of military overspending, persistent and growing trade deficits, and poor economic performance, the US economy is unable to raise sufficient savings to devote to domestic investment. It is estimated that “saving and investment have declined substantially as a percentage of GDP over the last 40 years, and have collapsed almost entirely since the financial crisis,” and that investment “barely keeps pace with depreciation.” Overall, the US “does not save enough money to fund all of the worthwhile domestic investments and relies substantially on foreign investors to make up the difference” (Cole 2014).
These figures were cited in a piece written for the Tax Foundation in 2014, but since then the situation of the US economy in all these respects has become significantly worse. While the US could potentially increase the level of savings available for investment, the funds involved would have to come either from reducing consumption by the population or from cutting military expenditure. The latter, especially with the current conflicts in Ukraine and Gaza, and with the deployment of military muscle against China around the Taiwan region of China, is politically impossible. Meanwhile, real wages have actually stagnated for decades: “Between 1979 and 2020, workers’ wages grew by 17.5% while productivity grew over three times as fast at 61.8%” (Lee 2022). Furthermore, US direct investment abroad is outstripping inward foreign direct investment; in 2021 and 2022, the difference was US$1,331 billion and US$1,326 billion, respectively (Bureau of Economic Analysis 2023).
One crucial consequence has been the decades-long neglect of the country’s infrastructure, which compounds all the problems identified. The American Society of Civil Engineers (ASCE) reported in 2021 that “an estimated 6 billion gallons of treated water [are] lost each day in the U.S., enough to fill over 9,000 swimming pools,” at the same time as “43% of our public roadways [are] in poor or mediocre condition, a number that has remained stagnant over the past several years,” while “42% of the 617,000 bridges are at least 50 years old, and 46,154, or 7.5% of the nation’s bridges, are considered structurally deficient,” to mention just a few of the neglected areas (ASCE 2021).
An often-neglected dimension of US economic and political decadence is the rise of poverty in the wealthiest country on the planet. In fact, the US has the highest rate of childhood poverty, at 22%, of any major country on the planet. Figures for other countries include: Denmark, 3.7%; Finland, 3.9%; Norway, 5.1%; Iceland, 7.1%; Austria, 8.2%; Sweden, 8.2%; Germany, 9.1%; South Korea, 9.4%; UK, 9.8%; France, 11%; New Zealand, 13%; Poland, 13.6%; and Canada, 14% (Kidd 2012, 1). According to the Supplemental Nutrition Assistance Program, in fiscal year 2014 about one in four US children received their nutrition from food stamps, one in five lived in poverty, and one in six lived in a family that had trouble putting enough food on the table (Carlson 2016, 1, 5). Furthermore, the US has the highest rate of incarcerated people in the world, because high levels of poverty lead to high numbers of school dropouts and to crime; worse still, “children of incarcerated parents are five times more likely to go to prison” (McLaughlin 2016, 12). Between 2006 and 2013 the number of homeless children increased from 1.5 to 2.5 million, that is, by close to 70%, and in every state in the country there are families living with their children in cars or emergency shelters (Bassuk et al. 2014, 15–16).
A Government Accountability Office (GAO) study issued in September 2019 concluded that not only are the rich getting richer and the poor, poorer, but also that the former are living longer lives, while poor Americans are dying young.
The study found that 52% of the poorest 20% aged 51–61 in 1992 were still alive in 2014, whereas among the richest 20%, 75.5% had survived. That is, the poorest 20% were twice as likely as the wealthiest 20% to die over the 22-year period. The study found the same disparity in the area of life expectancy (see our comments below on life expectancy in China); only half of those without college degrees and in the bottom 20% of the income distribution survived until 2014. Among those with college degrees and in the top 20%, based on mid-career earnings, nearly 80% were still alive (Fadulu 2019). According to the US Census Bureau, in 2022 there were 37.9 million people in the US living in poverty (11.5% of the population) (US Census Bureau 2023a). In September 2022 the Congressional Budget Office, reporting on the 1989–2019 period, stated that
family wealth was skewed towards families at the top of the wealth distribution over the entire 30-year period. In 2019, families in the top 10 percent of the distribution held more than two-thirds of all wealth, and families in the bottom half of the distribution held only 2 percent of total wealth. (Congressional Budget Office 2022)
The poor economic performance of the US reduces the country’s ability to compete successfully in the world, and has led to a growing trade deficit. In 1989 this trade deficit was US$109,399 billion; growing year after year, by 2022 it had reached US$1,177,372 billion, that is, an 11-fold increase (US Census Bureau 2023b).
US-Latin America relations present an especially grim picture. Throughout the three decades following the US-orchestrated overthrow in 1973 of President Allende in Chile, Washington administrations imposed brutal neoliberal policies on the US “backyard.” Neoliberalism massively impoverished millions of people, undermined the sovereignty of the countries south of the Río Bravo (Grande), greedily appropriated their natural resources, forced wave after wave of privatizations of state assets, and weaponized the IMF and World Bank to impose structural adjustment packages that drove millions into desperate privation. By 1990 the proportion of the population in Latin America living below the poverty line was 48.3%, that is, 200 million people; this proportion declined only slightly by 1999 to 43.8% (211 million people). The mass poverty went together with unprecedented levels of income concentration at the top, with the richest 10% of households receiving 30% or even more of total income (ECLAC 2004, 33, 79), making Latin America the most unequal region in the world.
No wonder that in the first decade of the 21st century radical social movements and left-wing political currents defeated and ousted one neoliberal government after another (in some cases through mass insurrection), giving rise to the “pink tide” that changed the region’s political complexion for good. In 2005 a continental movement led by Chávez defeated US efforts to incorporate Latin America into a US-dominated free trade zone from Canada to Patagonia. This political offensive by progressive forces against neoliberalism further weakened the already declining United States, a situation that coincided with the economic rise of the People’s Republic of China.
Latin America: The Vanguard of the Global South in Building a Multipolar World
Between 1960 and 2000 commercial dealings between China and Latin America were negligible, but by 2012, at the height of the “pink tide,” this trade had increased 21-fold. By then the People’s Republic of China had become the main trading partner of several Latin American countries, in an economic relationship that has since continued to expand. The annual trade of Latin America and the Caribbean with China grew from US$12 billion in 2000 to US$445 billion in 2021, that is, a 28-fold increase ( The Economist 2023a).
This development was in line with China’s extraordinary rise in the world economy. In 1960, China’s GDP was less than US$60 billion, while that of the US was US$543 billion; by 2022 China’s GDP had increased to over US$17 trillion (Macrotrends 2023c) while that of the US was US$25 trillion (Macrotrends 2023d). That is, the US economy had grown 46-fold, whereas that of China had grown 283-fold. Moreover, in 1980 China’s rate of poverty was close to 100%, but after nearly 900 million people had been raised out of poverty, this had declined by 2023 to 12.6%. Meanwhile, the poverty rate in the United States was 17.8% (Wisevoter 2023). By 2021 China had managed to eradicate extreme poverty. In 2022, Jiantang Ma, Secretary of the Party Leadership Group of the Development Research Center, stated that “China’s battle against poverty has benefited the largest number of people in human history” (World Bank 2022). UN Secretary-General Antonio Guterres celebrated this feat as “the greatest anti-poverty achievement in history” (United Nations 2019). Life expectancy in China, a more accurate measurement of welfare, went from about 40 years in 1950 to over 77 years in 2023, that is, an increase of 37 years (Macrotrends 2023e).
China became South America’s largest trading partner, and though in the case of Central America the US remained the largest trading partner, China rose to second position. Although Mexico is heavily intertwined with the US in a comprehensive free trade agreement, during the period 2000–2021 its trade with China increased 40-fold (Cadena, White, and Lamanna 2023). Trade between China and Latin America is expected to grow to more than US$700 billion by 2035.
These commercial links have been strengthened by free trade agreements between China and a number of Latin American countries. China has signed free trade agreements with Chile (2005), Peru (2009), Costa Rica (2011), Uruguay (2016), and Ecuador (2023), and 21 countries have thus far signed up with China’s Belt and Road Initiative (Stott 2023). The trend of developments is suggested by the fact that according to The Economist (2023b), Chile sends 67% of its copper exports to China, and Brazil 70% of its soybean exports. By 2022, Latin America’s exports to China had reached US$184 billion (Hernandez 2023).
The interactions between Asia’s economic giant and Latin America are growing at a breathtaking pace, leading a prominent US think tank, the Wilson Center, to describe China’s growing influence in Latin America as the economic displacement of the United States: “In 2000, about 3 percent of the region’s population lived in a country where the economic weight of China was greater than that of the United States. Two decades later, that percentage had grown to 60 percent” (Urdinez 2023).
The same applies to foreign direct investment (FDI) from China into Latin America. In 2000–2004 the average annual Chinese FDI into Latin America was US$1 billion, which in 2005–2009 rose to more than US$3 billion. It increased further in 2010–2014 to nearly US$12 billion, and then reached US$14 billion in 2015–2019, before declining to US$11 billion in 2020–2022 (Dussel 2023, 5). Thus, the annual average Chinese FDI in Latin America during the period 2000–2022 was US$8 billion, that is, an accumulated total of US$184 billion that generated a total of almost 630,000 jobs. China’s FDI in Latin America has covered diverse areas including automobiles, electronics, energy, metals, minerals, mining, telecommunications, transport, and much more (Dussel 2023, 5, 10).
The trends examined above show the marked strengthening of the relationship between Latin America and the People’s Republic of China, a relationship that has recently been depicted as having evolved significantly, “showcasing immense potential for future growth and cooperation.” The partnership is described as having “opened up a wide range of opportunities for both regions, with economic, political, and social implications that can shape the global landscape” (Hernandez 2023).
China’s economic weight in the Latin American region is growing apace. In January 2023, Brazilian President Lula da Silva raised the possibility of negotiating a Mercosur-China free trade agreement. Chile’s president endorsed China’s application to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). Additionally, China signed a US$1 billion agreement with Bolivia to explore for lithium. China’s investment in Argentina’s lithium industry is worth about US$960 million. China is also investing in Brazil’s state-owned semiconductor center, CITEC. Additionally, Lula and Argentinian President Alberto Fernandez paid separate visits to Huawei during trips to China, showing Latin American interest in deepening IT cooperation with China, “much to the United States’ dismay” (Wu 2023).
In a visit to China in April 2023 Lula signed 15 agreements providing for wide-ranging cooperation. The most important recent milestone in the Brazil-China relationship, however, is said to have been “the signature of currency swap agreements between Brazil and China in March 2023.” 8 On 31 March 2023 China and Brazil signed an agreement to trade in one another’s currencies, allowing them to conduct their US$150 billion annual trade and financial transactions directly, “exchanging RMB Yuan for Brazilian Real and vice versa, instead of using the US dollar for settlements.” 9 Ironically, this was 59 years to the day since Brazil’s democratically elected President Joao Goulart was overthrown on 31 March 1964 by a US-led coup d’état, leading to a 21-year-long military dictatorship.
Brazil has the largest economy in Latin America, and Argentina the third largest. In April 2023, three weeks after the China-Brazil agreement was signed, Argentina’s government took the decision to pay for US$1.04 billion worth of Chinese imports in Yuan instead of US dollars, and then from May to make further payments in Yuan of US$790 million for monthly imports from China (Wu 2023). In January 2023, the People’s Bank of China expanded its currency swap with Argentina by 35 billion Yuan (US$5 billion) to 165 billion Yuan (US$22 billion). Argentina’s Economy Minister, Sergio Massa said “These types of measures give our reserves greater strength and are key to improving the prospects for net reserves, giving us greater freedom and capacity to intervene in the face of those who speculate and overspeculate with the economic situation …” (Wong 2023). As in the case of Brazil, a US-led coup d’état had overthrown Argentina’s legitimate government 47 years before (on 24 March 1976), and installed a military dictatorship. The government of the Argentinian generals was to assassinate 32,000 people in only six years.
The election of Javier Milei as Argentina’s president is likely to complicate, but not stop, Brazil’s proposal to establish a common currency for its mutual trade with Argentina and as a base for a common Latin American currency. Brazil is Argentina’s main trading partner in Latin America, so Milei’s threats to break commercially with Latin America’s giant may just be electoral demagoguery; it would be very difficult to implement, and entirely self-destructive. Breaking commercially with China would also be disastrous, since Argentina exports 92% of its soy and 57% of its meat to China, and China has invested heavily in Argentina’s lithium industry and energy sector ( Asia News 2023). An announcement by Milei’s main adviser Diana Mondino that Argentina would not join BRICS was confirmed by the president himself, prompting a former Argentinian ambassador to China to remark that the decision would “cause serious harm to Argentina’s economy” ( Global Times 2024).
On 21 October 2023 Dilma Rousseff, the recently appointed president of the BRICS New Development Bank, met with China’s President Xi Jinping to discuss ways to develop a new, fairer and more equitable financial architecture aimed at allowing the participation of “emerging markets” and countries undergoing development. Rousseff also participated in the 3rd Forum of the Belt and Road Initiative (18–19 October 2023), where she described the Belt and Road Initiative as one of the most effective instruments to build a global community of shared future that would be “multipolar, inclusive and sustainable” ( Brasil 247 2023).
On 12 October 2023, at the Energy Week Forum held in Moscow, Venezuelan Vice-President Delcy Rodríguez made an appeal to de-dollarize the oil market, and called on the 31 countries targeted by US sanctions to jointly confront these measures of the United States. She also pointed out that as a consequence of US sanctions, Venezuela’s oil industry had lost 4,000 million barrels of oil, costing the country the equivalent of US$600 billion (Swissinfo 2023).
Although China is the second-largest trading partner for Central America, which has been more of a “US backyard” than the rest of Latin America, the Central American region has also been affected by the geopolitical shift away from the United States. The following Central American governments have broken relations with the Taiwan region of China and established them with the People’s Republic of China: in June 2007, Costa Rica; in June 2017, Panama; in August 2018, El Salvador; in November 2021, Nicaragua; and in March 2023, Honduras.
The salient features of China-Latin America relations are “complementarity” and “development.” The People’s Republic of China is an integral part of the Global South, and for Latin America, cooperation with China’s already advanced economy—whose further development is inexorable—offers growing opportunities for mutual benefits (Guo 2023).
Since the outbreak of the “pink tide,” Latin America has catapulted itself to the front line of building a fairer world order, 10 a place that it now objectively shares with the People’s Republic of China. The ups and downs of the class struggle in Latin America notwithstanding, the growing collaboration between Latin America and China is helping politically to reinforce multipolarity and to aid the building of a new world order. This new world system promises to be free from illegal US sanctions; from unfair trade practices; from the persistent destabilizing effects of external interference and attacks on the national sovereignty of countries of the Global South; from the imposition of US-IMF-led austerity; from the weaponization of the dollar; from the application of “regime change” strategies against countries pursuing a path of development that avoids domination by the US; and so forth.
In this connection, the People’s Republic of China has not only become the world’s center of gravity, but is also a powerful world force aiming “to build an open, inclusive, clean and beautiful world that enjoys lasting peace, common security, and common prosperity” (Ministry of Foreign Affairs of the People’s Republic of China 2023).
Conclusion
The People’s Republic of China has continued to develop strong economic, trade and political links with the Bolivarian Republic of Venezuela through thick and thin, even during the worst moments that the South American nation has experienced as a result of US sanctions. As recently as October 2023, the spokesperson of the Ministry of Foreign Affairs of the People’s Republic of China Ning Mao welcomed the “resumption of political dialogue in Venezuela” and demanded that the United States “completely eliminate the unilateral and illegal sanctions currently applied against the Bolivarian Republic of Venezuela” ( Orinoco Tribune 2023). This stance by the People’s Republic of China gives confidence to other left-wing and progressive (and even not very progressive) governments in Latin America in the solidity and coherence of China’s foreign policy toward the region and the Global South.
Furthermore, Latin America has seen what China can and does offer to their development, especially when compared to US policies in the region. Whereas the People’s Republic of China offers huge resources for development and progress in every key field, and crucially, respects the national sovereignty of Latin American countries, the United States offers neoliberal austerity, aggression, unilateral coercive measures, and military bases. It provides political support for the most extreme right-wing political currents, such as those represented by Uribe in Colombia, Añez in Bolivia, Bolsonaro in Brazil, and Milei in Argentina, while also persistently trampling on Latin American sovereignty.
As can be seen, Hugo Chávez with his 1999 visit blazed the path for Latin America to develop links with the People’s Republic of China that are fundamentally different from the region’s relations with the United States. Subsequently, the original “pink tide” governments massively developed commercial, economic and political relations between the region and the People’s Republic of China (Dominguez 2017, 22–40). Paradoxically, the aggressive moves by the US against those governments had the effect of intensifying Latin America’s willingness to participate in the building of a multipolar world.
The US played a crucial role in the ousting of Manuel Zelaya in Honduras in 2009; in the coup attempt against President Rafael Correa in Ecuador in 2010; in the “constitutional” coup against President Fernando Lugo in Paraguay in 2012; in the electoral defeat of the Peronist government in Argentina in 2015; in the impeachment of Dilma Rousseff in Brazil in 2016; and in the false accusations of corruption that resulted in the imprisonment of Lula and facilitated the electoral victory of Jair Bolsonaro in Brazil in 2018. That is not to speak of the continuing US aggression against Venezuela, Cuba and Nicaragua (Weisbrot 2018). The US, of course, has been the mastermind of every attempt to overthrow Venezuela’s Bolivarian Revolution since 1999.
Latin America’s yearning for a better world began to take shape simultaneously with the emergence of a new geopolitics, being constructed primarily by the People’s Republic of China through the BRICS, the Shanghai Cooperation Organization, and the Belt and Road Initiative. This new geopolitics provides ample opportunities to the Global South for investment, for markets, and for technology and credits, offering the real possibility of socio-economic development in an inclusive, multipolar, peaceful, stable world. This is a possibility that was previously denied to most of humanity in the unipolar world hegemonized by the United States.
An editorial in China Daily commented ironically on the aggressive approach taken by the US in its “competition” with the People’s Republic of China, stating as follows:
It is not China that started the trade war between the two countries, nor is China suppressing the development of US tech companies. The Chinese military is not conducting so-called freedom of navigation operations off the US coast, nor is China meddling in the US’ internal affairs. And it is not China that is hyping up the need for countries to de-risk in order to create the impression of covert threats, nor is China reshaping supply chains to be exclusionary. ( China Daily 2023c)
A Global Times editorial expanded on this view by pointing out that US aggressiveness is not applied only to China:
In 2022 alone, the US carried out 100 sanctions against others, involving 82 countries and regions. The number of entities on the US Treasury Department’s Office of Foreign Assets Control (OFAC) sanctions list has increased from 912 in 2000 to 9,421 in October 2021, a net increase of 933 percent. ( Global Times 2023)
The editorial article accurately described and predicted current US behavior:
When Washington needs to suppress opponents, democracy is a weapon; when it needs to win over partners, democracy is a foundation. The anti-democratic “tyrant” talks about “democracy,” which is an insult to democracy. The hegemonic, bullying and domineering nature of US democracy is experiencing unprecedented internal and external shocks. From the Capitol Hill riots in 2021 to the once-in-a-century political chaos this year, “US democracy” has begun to show cracks from within. The successful democratic practices of other countries are seen as a formidable enemy by the American political elite, who are accustomed to self-importance. ( Global Times 2023)
Latin America’s progressive vision of a better, multipolar world coincides closely with the foreign policy objectives of the People’s Republic of China, spelled out at the Boao Forum in 2015 by President Xi Jinping in his speech “Community of Common Destiny.” President Xi’s argument is that the “win-win” concept is grounded in the current reality of the international division of labor—“with global colonialism and the Cold War long gone, countries are now increasingly interconnected and interdependent”—and in the growing mutual trade and investment in which all nations engage. For this, they require the actual means to permit such interactions, such as free trade zones, ports, railways, highways, airports and telecommunications links ( Xinhuanet 2015).
President Xi posited that all countries are “equal members of the international community with equal rights to participate in regional and international affairs,” and that no civilization is superior to others, only culturally unique. This is in stark contrast to the way the US is presented by its elite as “the greatest country that has ever existed in history”—a characterization implying, by definition, that all other countries are inferior. As this indicates, equality in international relations is viewed by the US as a threat to its supremacy, and competition is a zero-sum game of all against all. In short, the United States works to create “win-lose” outcomes, from which it expects to benefit. In sum, China’s foreign policy concept of mutual benefit is expressed in its “win-win” policy, while “the US concept is competition, zero-sum games, and United States supremacy” (Ross 2015). 11
At the time of writing (October 2023), it has been 24 years since Hugo Chávez first visited the People’s Republic of China, starting a relationship that would grow stronger with each passing year and with every US imperialist aggression against the Bolivarian Republic of Venezuela. Attesting to the strength of this relationship are the cooperation agreements, numbering 790 so far, that have been signed between the two countries, and the myriad joint bodies and institutions that have been established, especially the binational Joint High-Level Commission that oversees, fine-tunes and develops the win-win ties between the two countries.
In his latest visit to the People’s Republic of China, President Nicolás Maduro declared that China and Venezuela have a relationship of “mutual intimate trust” and “true friendship,” and that they share “a common destiny in the new world that is emerging” and that both nations are committed to peace, development and cooperation. Thus, President Maduro gave full backing to President Xi’s objective to “build a community of shared destiny for humanity” ( Xinhua 2023).
