Russia extends a helping hand to Venezuela amid its debt crisis

The Russian Finance Ministry said it signed the agreement on November 15 in Moscow, under which Venezuela is expected to pay Russia $3.15 billion over 10 years.

A gas station of Venezuela's state energy company PDVSA in the capital Caracas. Photo: Reuters

According to AP, this move comes just one day after Venezuela held a meeting with foreign investors to discuss the country's debt restructuring strategy.

Russia said the agreement between the two countries would allow Venezuela to allocate more financial resources to economic development.

In addition, the above amount of 3.15 billion USD will be paid "at least" in the first 6 years.

This can be seen as Russia's act of extending a helping hand to Venezuela, as this South American country is bankrupt and needs some "breathing" time to recover.

However, the agreement does not include the liability of state-owned energy giant Petroleos de Venezuela SA to Russian state-owned company Rosneft, according toBloomberg.

"The terms are very flexible and favorable for our country. We will be able to re-establish trade relations at the previous level with Russia," said Wilmar Castro Soteldo, Venezuela's vice president for the economy.

This is the second time Russia has restructured Venezuela’s debt after agreeing to a rescheduling last year. However, Venezuela has been unable to repay its debts due to an economic crisis amid low oil prices, while oil exports account for a large share of the country’s exports.

Russia's Rosneft has also provided billions of dollars in advance payments to Venezuela's oil suppliers.

According to tuoitre.vn