Venezuelan President Chavez in Beijing to boost trade

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Friday, August 25, 2006

Venezuelan President Hugo Chavez arrived in the Chinese capital of Beijing, Wednesday, beginning a visit that will see new agreements to increase China's investment in Venezuela's petroleum, telecoms, agriculture and transport. Chavez says that his country intends to boost its oil exports to China to 500,000 barrels a day within five years, quadrupling its current exports, and up to one million barrels a day by 2012.

"Within five years we'll arrive at half a million barrels (a day) to China. We are currently exporting close to 150,000 barrels (a day), and next year we will double that," Chavez said.

"The oil issue is of utmost importance because we are diversifying the petroleum business. We are moving toward a new petroleum model," said Chavez, speaking on Venezuelan state television from China. "It's one step more in a strategic alliance."

Chavez met Chinese President Hu Jintao on Thursday, senior leader Wu Bangguo and Premier Wen Jiabao on Friday. Following Thursday's meeting, Chavez said that Jintao agreed to support Venezuela's bid to join the United Nations Security Council as a non-permanent member. He is also discussing Chinese involvement in developing his countries gold and coal mining industries, according to reports.

The countries are also signing agreements for Chinese assistance in building a petrochemical plant within the Amuay oil refinery in western Venezuela.

Agreements are expected to be signed with two of China's state owned oil companies to develop and export crude from Venezuela's Orinoco river basin as well as to approve the sale of Chinese oil tankers to Venezuela.

While the United States remains the leading importer of Venezuela's oil, Chavez' left wing government has sought to diversify its trading partners in an attempt to reduce its reliance on the United States and promote a "multi-polar" world order.

China is the world's second largest consumer of petroleum and is in need of increased oil supplies in order to maintain its rapid pace of economic growth.

Chavez told Venezuelan state television that increased trade with China and Russia will help boost Venezuela to medium-power status. He claimed that investment agreements with China will transfer technology to his country and help Venezuela escape dependency.