In a shocking turn of events, Donald Trump managed to disrupt a relationship that China had painstakingly cultivated with Venezuela for decades. Just hours before the Venezuelan president, Nicolás Maduro, was apprehended in a surprise nighttime raid, he was publicly praising his Chinese counterpart, Xi Jinping, describing him as an "older brother" who delivers a powerful message as a leader on the world stage. This meeting took place with senior diplomats from Beijing, highlighting the deep ties between the two nations. China has invested significantly in Venezuela, one of its closest partners in South America, particularly in the oil sector.
China's state media showcased the camaraderie between Maduro and Xi, featuring footage of the two leaders smiling and discussing over 600 agreements that bind their countries. However, the subsequent image of Maduro, blindfolded and handcuffed aboard a U.S. warship, starkly contrasted the earlier display of unity. This rapid shift underscores the precarious nature of international relations and the impact of U.S. foreign policy decisions.
In the wake of the U.S. intervention, China joined a chorus of global voices condemning Washington's actions against a sovereign nation. Beijing accused the United States of overstepping its bounds, insisting that the sovereignty and security of all countries must be respected under international law. Despite these strong statements, China is aware that it must navigate the complexities of its relationship with the U.S. while maintaining its influence in South America.
The current geopolitical landscape presents both opportunities and challenges for China. While some analysts view the situation as advantageous for the Chinese Communist Party, there are also elements of risk and uncertainty. As Trump’s presidency continues to disrupt established norms, Beijing finds itself grappling with the implications of these changes. The ongoing U.S.-China trade war has already tested Beijing's long-term strategies, and the latest U.S. actions regarding Venezuelan oil may further complicate its calculations.
Trump's aggressive moves towards Venezuelan oil have raised suspicions in Beijing regarding American intentions: how far is the U.S. willing to go to limit China's global influence? During an NBC interview, U.S. Secretary of State Marco Rubio emphasized the importance of the Western Hemisphere to the U.S., asserting that it will not allow rivals to gain a foothold in the region. This message, directed at Beijing, indicates a clear stance on U.S. interests in Latin America.
As China reflects on its position, some analysts speculate whether Beijing might consider applying similar strategies regarding Taiwan, the self-governing island viewed by China as a breakaway province. Xi Jinping has made it clear that he intends for Taiwan to eventually reunite with the mainland, and the recent U.S. actions could embolden some nationalists in China. However, it's essential to understand that Beijing sees Taiwan as an internal issue, not one that falls under international jurisdiction. The decision to act on Taiwan will not be influenced solely by U.S. precedents, as China's leadership weighs the risks involved.
The economic relationship between Beijing and Caracas is straightforward: China needs oil, and Venezuela needs cash. From 2000 to 2023, China invested over $100 billion in Venezuela, financing infrastructure projects such as railways and power plants. In return, Venezuela supplied the oil necessary for China's growing economy, with around 80% of its oil exports heading to China last year. However, this collaboration remains a small fraction of Venezuela's overall oil exports, raising questions about the sustainability of such investments amid U.S. interventions.
Despite the robust economic ties, experts warn that risks remain. With major Chinese firms like CNPC and Sinopec operating in Venezuela, there is a looming threat of asset nationalization or marginalization due to U.S. policies. Additionally, the $10 billion in outstanding loans Venezuela owes to Chinese creditors adds another layer of complexity. Eric Olander, editor-in-chief of The China-Global South Project, advises caution, noting that the current situation could deter future investments in the region.
China must carefully balance its interests in Latin America with its ongoing trade negotiations with the U.S. The fear is that other South American countries might begin to reconsider their significant investments from China, wary of drawing unwanted attention from the U.S. Given that South America is a vital source of food, energy, and natural resources for China, the stakes are high. With two-way trade exceeding half a trillion dollars, the implications of U.S. demands—such as urging Panama to cancel Chinese port holdings—are profoundly concerning for Beijing.
As the geopolitical landscape shifts, China faces the challenge of maintaining its foothold in Latin America while navigating a complex relationship with the United States. The recent U.S. actions in Venezuela represent a challenge that China did not need, complicating its long-term strategy to win over the Global South. Moving forward, Beijing will need to employ a combination of patience, strategic assessment, and adaptability to secure its interests in this critical region.