The rise of a great power: starting with military industry

Chapter 620: Opportunities in Venezuela

The next friend Liu Tao is going to meet is his friend 'Jose' from Venezuela!
China and Venezuela established diplomatic relations in 1974. After the reform and opening up, the relationship between the two sides developed rapidly and a friendly cooperative partnership was established.

Venezuela, whose full name should be the Bolivarian Republic of Venezuela, is a country located in the northern part of South America. It has a land area of ​​91.64 square kilometers. It borders the Caribbean Sea to the north, Colombia to the west, Brazil to the south, and Guyana to the east.

Venezuela is rich in natural resources, and its main mineral resources include oil, natural gas, iron ore, bauxite, gold, coal, nickel, diamonds, etc.

It currently has a population of 1880 million.

As early as 1922, the Royal Dutch Shell Company put into production the first domestically produced oil well on the shores of Lake Maracaibo, marking the beginning of Venezuela's history of oil extraction.

At that time, the Venezuelan government decided to outsource the oil extraction business to foreign companies. The abundant oil resources allowed the country to live a good life just by receiving commissions from oil revenues.

19 foreign oil companies, led by the United States, control almost all of the country's oil refineries, and a large number of local people work for foreign capital.

The first oil crisis broke out in 1973, oil prices skyrocketed, and Venezuela ushered in the most prosperous period in its history.

At that time, Venezuela became the richest country in Latin America, with a per capita GDP even higher than that of European countries such as Spain and Greece.

After that, Venezuela was not content with just taking commissions from oil revenues and decided to get the bulk of the revenues. Eventually, it signed a bill to nationalize the oil companies at the cost of high compensation.

However, things did not develop as hoped. Many multinational companies threatened to reduce the amount of oil imports from Venezuela or even refuse to sign procurement contracts, forcing Venezuela to reduce its oil sales.

On the other hand, although Venezuela is a major oil-producing country, it is a dwarf in oil technology.

For a long time, due to the lack of core technology, Venezuela's oil exploration, refining, transportation and sales processes have been monopolized by foreigners.

The foreign oil companies operating Venezuela's oil fields were expelled, but the effect was not good because after the nationalization of Venezuela's oil industry, production was not as efficient as that of private enterprises, and production has not increased.

Moreover, due to the lack of necessary technology, oil companies still need to hire a large number of foreign engineers and technicians to complete the mining work.

However, after the outbreak of the Iran-Iraq War, Venezuela ushered in a turning point.

The surge in oil prices has given Venezuela a huge opportunity.

Even the United States, after several setbacks, had to loosen its grip on Venezuela, increase oil exploration in Venezuela, improve oil production in Venezuela, and increase oil imports from Venezuela.

In 1980, Venezuela had proven oil reserves of 190 billion barrels. Now, Venezuela's proven oil reserves have grown to 600 billion barrels.

Venezuela's oil production has also increased to 200 million barrels. Relying on oil revenues, Venezuela can earn at least 200 billion US dollars each year. Although part of the profits go to multinational companies, Venezuela is also making a lot of money. Its economy is rising like a rocket.

With huge profits from oil, Venezuela's economic development is very good. It is a unique country in South America and has been a high-income country in recent years.

As the economy improves and the government has money, it will think about strengthening the military.

Although Venezuela's total military strength has not increased, it has never stopped increasing its weapons and equipment over the years.

For example, fighter jets are all purchased from the United States, and warships are also purchased from the United States.

American arms dealers eat meat, while Panshan Group drinks soup.

This time, Venezuela did not come to purchase warships, but only to strengthen economic and trade cooperation between the two sides. Liu Tao's face was full of smiles, and he talked about promoting economic and trade cooperation and strengthening exchanges between the two sides. In fact, Liu Tao was ready to sell all his shares in the oil company.

Although Venezuela's economic development seems to be booming now, its economic structure is actually very simple. Once the oil price falls, Venezuela's good days will be over.

Take advantage of the current good market conditions and sell off shares in the oil company.

It is not that Venezuela does not have abundant oil. On the contrary, Venezuela has large oil and natural gas reserves. The problem is that the cost of oil production in Venezuela is much higher than that of Saudi Arabia and Kuwait, and even higher than that of oil extraction in the Soviet Union. Moreover, the oil is heavy oil of extremely poor quality.

When the oil price is high, you can make a lot of money. But once the oil price is low and the market is not good, Venezuela will be in a very bad situation at that time, no matter how prosperous it is now.

After seeing Jose off, Liu Tao sighed.

If possible, supporting Venezuela is a good choice. Making Venezuela strong is equivalent to driving a nail into South America, causing trouble for the United States and disgusting the United States.

Unfortunately, Venezuela does not seem to be a troublemaker, and it is too close to the United States. American capital has already infiltrated Venezuela like a sieve.

I can only say that Venezuela is too far from heaven and too close to the United States!

Liu Tao meets with at least one friend almost every day, either to discuss weapons and equipment or other areas of cooperation.

Even in Pakistan, Liu Tao made a special trip to meet an old friend.

After Pakistan took over Kashmir, it had a geographical advantage. However, the navy suffered a great loss, and the two sides did not put down their hatred because of the agreement on the Kashmir issue. The war was over, but the two sides still had a war of words from time to time, and they were very unhappy with each other.

Pakistan now needs to strengthen its naval power to avoid being crushed by the Indian Navy.

Although Pakistan is relatively poor and lacks oil, with the total oil reserves of Pakistan less than 100 million barrels, Pakistan is supported by many wealthy people in white robes and big beards.

When purchasing weapons and equipment, brothers often help.

此次同样也不例外，一出手就是大笔订单，15艘022型导弹艇、5艘022A型鱼雷艇、4艘054型护卫舰、2艘052型驱逐舰，总订单达到了60亿美元。

甚至于，巴基斯坦还采购了30架歼教7A、20架‘雄鹰’高教机、40架歼10，飞机的总订单高达20亿美元。

Although the aircraft were delivered in batches and the money was not paid all at once, Pakistan's ability to purchase such a large quantity of weapons and equipment clearly shows that it was not Pakistan itself that was responsible.

However, after so many years of cooperation, Liu Tao has become accustomed to it.

As long as people give him the money, what does he have to worry about?

Even if India came to him to buy weapons, Liu Tao would dare to sell them as long as they paid.

Of course, if Liu Tao wanted to get something for nothing, he would never hand over any weapons, because doing business with India is the blood and tears that countless Chinese people have experienced after doing business with India.

When doing business with other countries, you can pay after the goods arrive. But when doing business with India, you must get a deposit before production, and the balance can only be paid after it is settled.

(End of this chapter)