Chapter 620: Opportunities in Venezuela
The next friend Liu Tao wants to meet is his friend ‘José’ from Venezuela!
China and Venezuela established diplomatic relations in 1974. After the reform and opening up, the relationship between the two parties developed rapidly and established a friendly and cooperative partnership.
Venezuela, whose full name should be the Bolivarian Republic of Venezuela, is a country located in northern South America with a land area of 916,400 square kilometers. It is bordered by the Caribbean Sea to the north, Colombia to the west, Brazil to the south, and Guyana to the east.
Venezuela is rich in natural resources. Mineral resources mainly include oil, natural gas, iron ore, bauxite, gold, coal, nickel, diamond, etc.
It currently has a population of 18.8 million.
As early as 1922, Royal Dutch Shell put into production the first domestic oil well on the shores of Lake Maracaibo, kicking off the history of oil exploration in Venezuela.
At that time, the Venezuelan government decided to outsource the oil extraction business to foreign companies. The rich oil resources allowed the country to live a good life just by extracting oil revenue.
19 foreign oil companies headed by the United States control almost all the oil refineries in the country, and a large number of local people work for foreign capital.
The first oil crisis broke out in 1973, oil prices skyrocketed, and Venezuela ushered in its most prosperous period in history.
At that time, Venezuela became the richest country in Latin America, with a per capita GDP even higher than that of Spain, Greece and other European countries.
After that, Venezuela was not content with just taking a commission from the oil revenue, and decided to get the majority of the revenue. Finally, at the expense of high-priced compensation, Venezuela signed a bill to nationalize the oil company.
However, things did not develop as hoped. Many multinational companies threatened to reduce the amount of oil they imported from Venezuela, and even refused to sign purchase contracts, forcing Venezuela to reduce its oil sales.
On the other hand, although Venezuela is a major oil-producing country, it is a dwarf in oil technology.
For a long time, due to the lack of core technology, Venezuela’s oil exploration, refining, transportation and sales processes have been monopolized by foreigners.
Expelled foreign oil companies operating Venezuela's oil fields, but the effect was not good. Because after Venezuela's oil industry was nationalized, production was not as efficient as private companies, and production has not been able to increase.
And due to the lack of necessary technology, oil companies still need to hire a large number of foreign engineers and technicians to complete the extraction work.
However, after the Iran-Iraq war broke out, Venezuela ushered in a turning point.
The sharp rise in oil prices has given Venezuela huge opportunities.
Even the United States, after suffering several setbacks, had to loosen its grip on Venezuela, increase Venezuelan oil exploration, increase Venezuelan oil extraction, and increase oil imports from Venezuela.
In 1980, Venezuela's proven oil reserves were 19 billion barrels. Now, Venezuela's proven oil reserves have grown to 60 billion barrels.
Venezuela's oil production has also increased to 2 million barrels. Relying on oil revenue, Venezuela can earn at least 20 billion U.S. dollars every year. Although part of the revenue belongs to those multinational companies, Venezuela is also making a lot of money, and its economy is like sitting on a mountain. Like a rocket, it keeps rising.
With the huge profits from oil, Venezuela's economic development is very good. It can be said to be unique in South America. It has been a high-income country in recent years.
When the economy improves and the government has money, it will think about strengthening the military.
Although Venezuela's total military strength has not increased, the increase in weapons and equipment has not stopped in recent years.
For example, fighter jets are all purchased from the United States, and warships are also purchased from the United States.
The American arms dealers are meat eaters, while the Panshan Group is soup drinkers.
This time, Venezuela is not here to purchase warships, but to strengthen economic and trade cooperation between the two sides.
Liu Tao had a smile on his face, and he was talking about promoting economic and trade cooperation between the two sides and strengthening exchanges between the two sides. In fact, Liu Tao was planning to sell all his shares in the oil company.
Now Venezuela seems to be booming in economic development, but in fact the economic structure is very simple. Once the oil price drops, Venezuela's good days will be over.
While the market is good now, sell off your shares in oil companies.
It’s not that Venezuela is not rich in oil, on the contrary, Venezuela has a large amount of oil and natural gas reserves. The problem is that the cost of Venezuelan oil production is much higher than that of Saudi Arabia, Kuwait, and even higher than the cost of oil extraction in the Soviet Union, and the quality of the oil is extremely poor. of heavy oil.
When oil prices are high, you can naturally make a lot of money. But once the price of oil is low and the market goes bad, Venezuela will be in a state of embarrassment then, even though Venezuela is so prosperous now.
After seeing Jose off, Liu Tao sighed.
If possible, supporting Venezuela is a good choice. Making Venezuela strong is equivalent to setting a nail in South America and causing trouble for the United States. It is also good to disgust the United States.
Unfortunately, Venezuela does not look like a thorn in the side, and it is too close to the United States. American capital has already penetrated Venezuela like a sieve.
All we can say is that Venezuela is too far from heaven and too close to the United States!
Liu Tao meets at least one friend almost every day, either to discuss weapons and equipment or other aspects of cooperation.
Even in Pakistan, Liu Tao also met with his old friends.
After Pakistan got Kashmir, it had a geographical advantage. But the navy suffered a great disaster, and the two sides did not let go of their hatred because of the signing of the agreement on the Kashmir issue. The war was over, but the two sides still had a war of words from time to time, and they were very unhappy with each other.
Now Pakistan is strengthening its naval power to avoid being directly crushed by the Indian Navy.
Although Pakistan is relatively poor and lacks oil, the entire Pakistani oil reserves are less than 100 million barrels, but Pakistan has many local tyrants with white robes and big beards behind it.
When purchasing weapons and equipment, brothers often help.
This time is no exception. A large order was placed at the first shot, including 15 Type 022 missile boats, 5 Type 022A torpedo boats, 4 Type 054 frigates, and 2 Type 052 destroyers, with a total order of US$6 billion.
Even more, Pakistan also purchased 30 J-7A, 20 "Eagle" advanced trainer aircraft, and 40 J-10, with a total order of aircraft as high as US$2 billion.
Although the aircraft were delivered in batches and the money was not paid all at once, Pakistan was able to purchase such a large number of weapons and equipment, which shows that it was not Pakistan itself that was able to do so.
However, after so many years of cooperation, Liu Tao has become accustomed to it.
As long as the other party can pay, what does he have to worry about?
Even if India came to him to buy weapons, Liu Tao dared to sell them as long as he paid.
Of course, if he wanted to get something for nothing, Liu Tao would never deliver any weapons, because doing business with India is the blood and tears of countless Chinese people who have done business with India.
When doing business with other countries, you can pay after the goods arrive, but when doing business with India, you must get a deposit before production, and the final payment can be paid before delivery.