China Scrutinizes Venezuela Loans Amid Rising Default Risks
According to the Economic Desk of Webangah News Agency, China has initiated a comprehensive review of its loan portfolio to Venezuela amid escalating default risks. The National Financial Regulatory Administration of China has directed domestic banks to enhance monitoring of all credit exposures linked to Venezuela, according to informed sources who requested anonymity due to the private nature of the discussions.
Victor Shi, a professor at the University of California San Diego, warned that Chinese creditors face heightened repayment risks if U.S. claimants become Venezuela’s major creditors. “Venezuelan government entities would struggle to meet both American demands and domestic expenditure needs,” Shi explained during an analysis of the situation.
China emerged as Venezuela’s primary lender in 2007 during the late President Hugo Chávez’s administration, financing infrastructure and oil projects in the South American nation. Public estimates indicate Chinese state institutions had extended over $60 billion in oil-backed loans by 2015 through government banks.
Alicia García-Herrero, chief economist at Natixis, noted the current exposure is likely lower as China has converted some debt into equity stakes. The financial reassessment follows Venezuela’s recent political turmoil, including the controversial transfer of President Nicolás Maduro to U.S. custody.
The Chinese Foreign Ministry condemned Washington’s actions as “a severe violation of international law” and demanded Maduro’s immediate release. Meanwhile, U.S. President Donald Trump emphasized America’s need for “full access” to Venezuela during the ongoing crisis.
