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The meeting between Venezuelan government officials and Chinese business representatives took place in Caracas and closed with the signing of a wide-ranging agreement to expand trade and technology transfer between the two countries. Last year trade between Venezuela and China was $1.4 billion and is expected to reach $2.4 billion for 2005, which is the highest level of trade ever between the two countries.

Among the six main agreements the two sides signed, one involved the creation of a computer manufacturing company, which would build computers in Venezuela’s free trade zone in the state of Falcón. “This will help cover internal demand for this type of equipment, lower costs, and establish a technological pole in this region,” said Gustavo Marquez, the Minister for Integration and Foreign Trade. Other agreements involved health and agriculture. Venezuela also committed itself to supply China with 1.8 million barrels of fuel oil, for electricity generating plants, once every two months.

With regard to other Chinese investments in Venezuela, China will open production of extra-heavy crude in the Orinoco Oil Belt, one of the world’s largest reserves of extra-heavy crude, holding 276 billion barrels of oil. The joint venture will produce as much as 300,000 barrels of oil per day during the next 20 years.

Venezuela plans to build a pipeline through Colombia, which would facilitate oil exports to China from Venezuela.