The International Monetary Fund’s forecast of 2,349% inflation for Venezuela in 2018, up from an estimated 2,069% this year, is a rude reminder for China – the Latin American country’s key foreign creditor – about the risks of overseas investment. China has showered the oil-dependent nation of 30 million people with more than $60 billion in loans, backed by oil supply deals and other contracts and investments. China Development Bank (CDB), a state lender, alone has poured at least $37 billion into the country in the last decade. But China has little leverage to protect its interests as economic and social conditions in Venezuela worsen, the South China Morning Post reports. Huo Jianguo, a vice-chairman of the China Society for the World Trade Organisation Studies, a think-tank affiliated with the Ministry of Commerce, said the IMF’s forecast should teach China to be more careful with its outbound investment.
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