China loans make Venezuela’s outlook more precarious
What will China do if Venezuela stops honoring its agreements? Means that they don’t pay back anymore (in cash or in kind). Won’t happen? That’s something we should not use anymore in connection with Venezuela. They will default on anything and then China can send the troops or write the loans off. However, would they want to send troops there? I doubt that.
Venezuela’s economic forecast continues to worsen. The government is struggling to pay back interest on loans to China—the terms of which were relaxed back in June 2016—and its dependency on oil exports to the Asian superpower have become “a question of survival”, as one analyst puts it.