“Oil Chinese” in Venezuela are treading carefully

Mr Li is the embodiment of today’s fastest growing world power: China. He strikes oil deals, builds hospitals and motorways, sells merchandise, takes over companies and lays oil pipelines. In the series ‘Looking for Mr Li’, four journalists from Radio Netherlands Worldwide and Dutch broadcaster VPRO report on the sunny side and the dark side of globalisation, with China’s expansion as their central theme. Here’s a second look at China’s role in Venezuela.

Where oil is concerned, everything in Venezuela is political. “Everything works very well here with the Chinese,” according to Argenis Hernández, a Venezuelan employed by China Petroleum Venezuela Technical Services. This small company is contracted by oil companies to carry out exploratory drillings in Venezuela.

As head of Operations and Marketing Mr Hernández holds a senior position within the company.“The Chinese have a lot of confidence in the Venezuelans. That’s borne out by the fact that I’ve got this position.”Oil dollar
President Hugo Chávez would like China to buy more Venezuelan oil so his country can become more independent of the United States. The US, according to Mr Chávez, is ‘the devil’, as he once proclaimed in a United Nations General Assembly meeting; yet he is dependent on the US, which still takes some 65 percent of his oil exports.

That makes Mr Chávez’ position vulnerable, because his economy is heavily dependent on the oil dollar. Moreover Mr Chávez has a great need to develop technology, and here too he is hoping for the support of China. But so far not much oil has actually been sold to China. Several sources estimate oil exports to China at between 160,000 and 200,000 barrels a day, compared to 1.5 million barrels a day to the US.

Mr Hernández declines to go into the cause of this disparity: “That’s a political question; I’d rather that my boss answers that.” The relationship between Venezuela and China is a sensitive one, and it’s also an issue that puts the two halves of this polarised country into directly opposing camps. On one side there are the Chavistas, who don’t see any problems where China is concerned, on the other side are members of the opposition who compare the Chinese involvement in the oil industry to the import of cheap Chinese goods: they are both of poor quality, nothing good can come of it.

Ill at ease

Mr Hernández’ boss turns out to be a somewhat shy Chinese. His name is Luo Qifeng and he’s been working in Venezuela for eight years. He spends three full months in Venezuela and then returns to his wife and child in China for three months. In his view, he is not living in Venezuela, he is merely working there. Not a word of Spanish passes his lips, so we speak English.

The reason for that soon becomes clear: he doesn’t feel at ease in Venezuela. It’s not safe. That is why he lives in a safe compound with a small group of Chinese. As an ‘oil Chinese’ he is the very opposite of those of his fellow-countrymen who run small shops or restaurants in this country. They can claim to be part of Venezuelan society. Integration, even the smallest attempt, is not part of Qifeng’s life. He is here to earn some money.

But that is not working out very well. His company has little work. Despite a contract with the Venezuelan national oil company PdVSA he has not been given any jobs by them. Some other companies occasionally hire him, but the main state company is conspicuous by it absence.

That is strange, because Mr Chávez’ open flirtation with China might lead one to believe that Chinese companies in Venezuela would enjoy a certain advantage. Mr Luo is not eager to analyse this any further. “It’s too political,” he states. But he adds that most of the work is still contracted out to the Americans.

“China needs a lot of oil, but Venezuela’s oil is too expensive,” he says. He is not just referring to the high costs of shipping the oil to China, which takes 40 days, but also to the insecurity that the commercial sector is experiencing under Hugo Chávez’ presidency. Mr Luo is remarkably open when he says,“Our parent company in China warned me about taking on work in Venezuela. Everything can suddenly change because of the political situation.”

For more information: radionetherlands.nl

“Oil Chinese” in Venezuela are treading carefully
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