China provides $20 billion loan to Venezuela

China says it has signed a framework financing deal with Venezuela worth about 20 billion US dollars. It also noted that about half the proposed amount will be in China's currency Renminbi.

Venezuela explains that the deal is a long-term, 20-billion-US dollar-financing plan for projects in the South American oil-exporter. China's Foreign Ministry Spokeswoman says part of the loan will be paid in the Chinese currency.

The spokeswoman of Ministry of Foreign Affairs Jiang Yu said, "The Chinese government and a corporate delegation have signed several bilateral cooperation accords with Venezuela. These include a financing framework agreement from the China Development Bank that provides 10 billion US dollars and 70 billion Renminbi to Venezuela. The accords will strengthen cooperation between the two countries in the oil and electricity sectors."

Analysts say the loan provides the South American oil exporter with badly needed capital. They add that it is also an attempt for the internationalization of the Chinese yuan, helping it become a settlement currency in the global oil trade.