Sun, May 12, 2019 - Page 7 News List

How a Chinese venture in Venezuela made millions while locals grew hungry

Caracas and Beijing agreed to hundreds of projects to kickstart growth in Venezuela, but after billions in investments, little has materialized

By Angus Berwick  /  Reuters, TUCUPITA, Venezuela

“We made deals with every company possible,” he added. “Some of these companies never actually carried out the projects.”

Rodriguez, who like Salazar has been charged with money laundering and conspiracy to launder, could not be reached for comment. Gimenez also represents Rodriguez and in the e-mail about Salazar, said that Rodriguez, too, is innocent.

As money poured in, Salazar splurged, paying tens of thousands of dollars for hotel stays and spending millions on gifts.

For US$1 million, he bought 83 Rolex and Cartier watches at a Caracas jeweler, an invoice in the filings showed. In a Rodriguez e-mail to BPA justifying the purchase, he said that the watches were “gifted to relatives and friends.”

Andorran police in April 2010 began investigating Salazar. French investigators had asked them about a recent transaction: From his BPA account, Salazar had transferred US$99,980 to a Paris hotel employee as a “tip for providing services.” It is not clear what those services were.

By May, talks for the rice project began.

That month, Rodriguez met with CAMC vice president Wang Hong in Caracas, according to a contract that the men signed. In the contract, they agreed that CAMC would pay Salazar’s company 10 percent of the value of the rice contract to help it “win.”

Within months, PDVSA Agricola awarded CAMC the contract, valuing the rice development at US$200 million. CAMC signed another agreement with Salazar for help securing additional projects. That June, CAMC made the first of several deposits totaling US$112 million to Salazar’s BPA account, bank records showed.

Workers broke ground in Delta Amacuro.

According to project documents, CAMC had by 2012 received US$100 million from the Venezuelan development bank for the undertaking, half that agreed upon. The company shipped excavators, steamrollers and other equipment from China.

However, progress was slow.

An excavator bogged down in mud and stayed there. Chinese foremen spoke little Spanish and struggled with local crews, engineers who worked on the project said.

On suspicion of money laundering, an Andorran court in November 2012 froze BPA accounts of Salazar, Rodriguez and six other Venezuelans. The prosecutors in 2013 began a years-long effort to interview Salazar and others.

The US Department of the Treasury in 2015 began pressuring Andorra over alleged money laundering. In a report at the time, the Treasury Department wrote that BPA facilitated laundering of money from Russia, China and Venezuela.

The Andorran government in March 2015 took over BPA.

Oil prices, which had exceeded US$100 per barrel, that year fell by more than half. Venezuela’s economy foundered.

CAMC pulled its team of 40 employees from the rice site, people involved in the project said. Locals looted scrap abandoned by CAMC, with jobless workers selling leftover cables and lightbulbs, former managers said.

Still, Maduro has sought to make something of the unfinished project.

Venezuelan Minister of Agriculture Wilmar Castro in February inaugurated the “Hugo Chavez” plant, snipping a ribbon in front of rice sacks emblazoned with Venezuelan and Chinese flags. No one from CAMC attended, a person present at the ceremony said.

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