More energy investments by China

February 22, 2009

The weekend’s New York Times (David Barboza, “China gets a warmer welcome for its cash”) reports on further Chinese energy investments abroad following the Rio Tinto and OZ Minmetals deals. Venezuela got a $6 billion loan and agreed to increase oil shipments to China; this brings Chinese investment in the country to $12 billion. Brazil signed a $10 billion oil-backed loan agreement with China, and Russia’s state-owned Rosneft and Transneft oil companies got a $25 billion loan in exchange for 15 million tons of crude oil in the next 20 years.

So the question whether the recession will speed up or slow down Chinese involvement abroad seems to have been answered in favour of the former. It is possible, though, that as Chinese companies now find easier access and better deals in larger, richer countries, some of the traditional client states like Laos and Cambodia will receive less attention.