(MENAFN- AFP) Sliding oil prices have sent Venezuela on a downward spiral -- and sent President Nicolas Maduro on a trip to China to make an urgent appeal for cash.
Maduro, who announced his "very important tour" in a national address Sunday after admitting Venezuela was in recession, made a stopover in fellow oil giant Russia on Monday before arriving Tuesday in China, his country's largest investor and second-largest oil customer.
The socialist leader, who has promised policy changes to address the inflation and shortages crippling Venezuela, will then tour several OPEC countries in an effort to revive his government's failed bid to persuade the cartel to slash output.
Venezuela was already mired in economic woes before oil began its recent slide, but the sharp downturn in crude prices -- which hit five-and-a-half-year lows Tuesday -- has been especially punishing for a country that relies on oil for 96 percent of its foreign currency.
In Beijing, Maduro is expected to ask for a new cash injection to shore up the Venezuelan economy in a legislative election year that could be bleak for his United Socialist Party, founded by late firebrand leader Hugo Chavez.
Maduro kicked off his visit by meeting with chief executives from the banking and oil sectors, said Venezuelan Foreign Minister Delcy Rodriguez.
He will also meet President Xi Jinping and take part in a two-day meeting between Chinese officials and the Community of Latin American and Caribbean States that opens Thursday, according to Venezuelan state news agency AVN.
- Beijing is key ally -
China has been a key ally of Venezuela since Maduro's predecessor Chavez came to power in 1999.
It imports an average of 640,000 barrels of Venezuelan oil a day, much of that paying off loans.
China has extended $42 billion in long-term loans to Venezuela, $24 billion of which has been paid out so far, according to Venezuelan officials.
Maduro's government wants Beijing to increase its oil purchases to one million barrels a day in the coming years and expand bilateral trade, which reached $20 billion in 2012.
Numerous economic analysts have warned that Venezuela is on the brink of a debt default, struggling to pay its bills while maintaining its lavish subsidies, oil discounts to allies and rigid system of foreign exchange controls.
The South American country is estimated to have the largest oil reserves in the world but depends largely on imports for basic goods, including food and medicine.
Maduro said in his pre-departure speech that he would use his trip "to tackle new projects to address the circumstances affecting our country, including the depletion of revenues due to plummeting oil prices."
Venezuela-based economist Asdrubal Oliveros said Maduro would likely lobby China to massively expand a $4 billion oil-backed loan that is due for renewal next month.
The Venezuelan government "wants to obtain far more resources than just the renewal of that credit line," Oliveros told AFP.
"Venezuela's financing needs amount to more than $20 billion in 2015."
But late deliveries of some oil shipments and the lack of a "clearly necessary structural adjustment plan" mean China may be hesitant to increase its backing, he added.
- 'We're broke!' -
Maduro will also renew his effort to persuade fellow OPEC members to lower their output, which would help ease the price plunge unleashed by booming US shale oil production.
Venezuela failed to rally the cartel behind its plan in November, when wealthy Gulf states rejected a production cut.
Maduro said he would visit "several" OPEC countries as well as non-OPEC member Russia, but did not give details on his itinerary.
His trip comes at a delicate political moment back home.
Maduro's popularity rating has tumbled to 22.6 percent, and 86 percent of Venezuelans have a negative view of the country's current situation, according to a recent poll.
Economists say Venezuela is facing an imminent devaluation of the bolivar currency, propped up by exchange rate controls since 2003.
But that would only increase prices for already scarce imported goods in a country where gasoline costs $0.02 a liter ($0.08 a gallon) but a bottle of water costs $2.
"They give you gasoline as a gift, but they rob you for everything else," said Angel Montilla, a gas station attendant in Caracas.
"What can you do with such cheap gasoline when food prices are exorbitant We're broke!"
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