Monday, November 26, 2018

Russians Want Their Money From Venezuela

The head of a major Russian oil company, Rosneft, went to Venezuela to let Nicolás Maduro know he was not happy about delayed oil shipments that were repaying loans. Reuters estimates Rosneft loans to equal about $17 billion since 2006. The added twist is that he complained further that Venezuela was paying China on time, but not Russia. The Russian government also recently made it clear it would not loan any more money to Venezuela given the current situation.

The point here is one I have made before about both Russia and China, but it bears repeating. You need to look beyond the simple "They are in our backyard to cause mischief and threaten us." The fact of the matter is that they want their money back. They are doing this in large to make a profit and fuel their own economies. The more Venezuela collapses, the more concerned they get. There is every reason to believe that if the government falls, a new one will try to get debt relief. So they need to balance the urgency of getting money back with trying to keep the government just afloat. This becomes just as much a matter of money as it is politics.


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