COHA Report: Russia Returns to Latin America

A COHA Report: Russia Returns to Latin America

With Washington obsessively focused on the Middle East, and with China and Iran’s stepped-up campaign to tighten their trade ties, as well as weapons procurement and resolve geopolitical matters with Latin America, the region’s importance is commensurately growing. But when it comes to evaluating Latin America’s overall economic and security standings as a destination point for global trade and hemispheric involvement, Russia has been all but left out of the discussion during most of its Putin presidency.

In the past several years, however, and with a burst of new-found visibility, Moscow has been gradually restoring itself as a major regional presence throughout the western hemisphere. It is now on the verge of fully reviving its stake in the region’s political and commercial agendas, buying and selling a broad range of commodities and services ranging from frozen fish to military ordnance. The January visit of the Chairman of the Russian Audit Chamber and President Vladimir Putin’s personal representative, Sergey Stepashin, to Nicaragua for the inauguration of President Daniel Ortega, is but the latest in a number of possibly important developments that have seen Russia returning to this hemisphere with masterly enthusiasm.

Russia and Latin America in the Post-Cold War World
The years of domestic crisis that followed the Soviet bloc’s dissolution and its subsequent isolation after the end of the Cold War era, left several of its allies in the region stranded: most drastically, Cuba. For Latin America, the 1990s have been characterized as the “lost decade,” due to the turmoil and tensions that consumed the region’s attention as a result of Russia’s turn inward. But Russia’s deference emphatically ended a few days ago when former KGB-agent President Vladimir Putin’s delivered a ‘tough’ speech to this year’s meeting of the Munich Conference on Security Policy. At that gathering he jeered at Washington for overreaching itself and acting as if it presided over a unipolar world. Putin went on to menacingly warn that the United States, “has overstepped its national borders in every way. This is visible in the economic, political, cultural and educational policies it imposes on other nations.”

Russia, for its part, has begun a surge of political and commercial proposals, which have included a large number of diplomatic trips being undertaken by Russian envoys to Latin America. These are emblematic of the Kremlin’s reenergized foreign policy offensive directed towards the Americas. At least three factors have been contributing to this process. With the exception of Chechnya, Putin has managed to put the Federation back in order domestically, with an invigorated economy that is now aggressively utilizing its gas and oil reserves to rebuild the state’s wealth. This campaign has subsequently allowed Moscow to focus on pursuing an aggressive foreign policy in what traditionally is viewed as Washington’s backyard.

Washington’s focus on its “War on Terror” has left an opening for nations like China, Iran and Russia to become more involved in the region, either (depending on one’s perspective) as part of the problem or solution. Russia’s reemergence is occurring at a time when much of Latin America is striving towards a more Washington-free environment by promoting indigenous economic integration and looking in directions other than at the U.S. for its trade and political partners (e.g., China, Iran, Canada, Spain). The recent elections of several anti-American, left-leaning leaders, and the desire of others to ally themselves with extra-hemispheric powers, (like the recently formed IBSA, consisting of South Africa, Brazil and India), also has contributed to opening up the environment for Russia’s growing influence.

On The Political/Diplomatic Front
Russia has demonstrated its interest in reviving former Soviet-era ties with Latin America and the Caribbean, as well as establishing new ones. In addition to Stepashin’s recent trip to Nicaragua, there have been other high-profile Russian protocolic visits to the continent. Last November, a delegation from the lower house of the Russian parliament, led by deputy house speaker Sergei Baburin, visited Mexico City. Joint statements by Mexican and Russian officials expressed a similarity of opinion on topics including the benefits deriving from a multi-polar world. Mexico City additionally demonstrated its determination to have good relations with Moscow by declaring its support for Russia’s admission to the World Trade Organization. Coinciding with the Russian delegation’s visit to Mexico, the Russian news agency ITAR-TASS published an interview with the Paraguayan foreign minister, Ruben Ramirez Lezcano, in which he stated that “Russia, owing to its geographic position, is for us a key link for establishing contacts with other states of the European and Asian regions.'’ Lezcano stressed that Paraguay looks forward to soon seeing the opening of a Russian Federation embassy in Asuncion in the near future.

On December 15, ITAR-TASS reported that the Russian foreign minister, Sergey Lavrov, signed a memorandum with ministers of MERCOSUR’s member states to facilitate political dialogue and economic ties. According to the news agency, the document reads: “Political dialogue will include, in particular, the analysis of problems connected with protection of democracy and human rights, peace and international stability, as well as prevention of conflicts and the strengthening of international security.” The signatories have also agreed to hold ministerial meetings on a biannual basis. Lavrov’s South American tour included a two-day visit to Brazil, where he met with the country’s Luis Inacio Lula da Silva and Foreign Minister Celso Amorim. Reflecting upon his visit, the Brazilian foreign minister observed that:
The two countries’ cooperation on the international arena is demonstrating the strength of principles and values which our countries share in their attitude to key matters. They include the protection of democratic principles, peace and international stability, disarmament and non-proliferation of weapons of mass destruction, efforts to improve international security, cooperation in the struggle against terrorism and the drug trade, and the strengthening of a multi-polar world.

Upon his return to the Kremlin, Lavrov was quoted as saying. “Brazil is interested in our joining in major projects of interregional importance, including a transcontinental gas pipeline, and modernization of railways in the continent.” He was referring to the proposed Venezuelan-led project to build a 10,000-kilometer pipeline through the Amazon that would stretch from Venezuela through Brazil to Argentina, with links to Bolivia, Paraguay and Uruguay. Russo-Brazilian political relations are also on the rise as referred in Moscow’s support of Brazil obtaining a permanent seat on the United Nation’s Security Council.

Also of importance, was the recent January visit to Cuba by Prime Minister Mikhail Fradkov. Reflecting upon Fradkov’s visit, Russian Deputy Foreign Minister Sergey Kislyak explained: “A period of adapting to new realities was not easy, but now we are moving towards a new level of cooperation and mutual interaction with our Cuban friends… Cuba has been and will remain our high-priority partner in Latin America.” He went on to add that Russia would continue to advocate “the abolition of the U.S. economic embargo and other sanctions against Cuba.” Regarding the Caribbean, ITAR-TASS’ Mikhail Makeyev noted that the number of Russian tourists visiting the Dominican Republic having greatly risen, and negotiations were underway regarding the opening of a Russian consulate general on the island.

Russia and the Pink Tide
An interesting development will be how Russia reacts to the Pink Tide cohort of left-leaning countries of the region. The delegations Moscow sent to Nicaragua and Cuba suggest that Moscow is not bringing any discordant ideological baggage to the table and will not try to force its attention on the movement, particularly with Caracas at this point. International attention began to keenly focus on this relationship in 2006 when Venezuelan President Hugo Chavez visited several Russian cities and met with Vladimir Putin. This occurred after Venezuela had initiated the purchase of 100,000 Russian-made Kalishnikov assault rifles, helicopters and other weaponry, much to Washington’s chagrin. A July 25 dialogue was conducted on the Russian Mayak radio station between Vladimir Averin and Ruslan Pukhov, director of the Strategies and Technologies Analysis Center, which presented an in-depth analysis of the significance of this visit. In the interview, Pukhov explained that:

Arms supplies will provide a link that may be followed by cooperation in the field of oil and gas. Similar projects are now being discussed in Algeria. […] Chavez is an extravagant person, but that has never deterred us [Russians]. We are not afraid of extravagant leaders. We are quite extravagant ourselves.

However, not everyone views arms supplies as providing a stable and durable link between Russian and its military clients. A January 23 article by Scott Sullivan of the The Conservative Voice argued that apart from the Kalishnikov deal, there have been no mega-contracts between Russia or China with either Venezuela or Bolivia. According to Sullivan’s pure speculations, “Russia and China are not avoiding Chavez and [Bolivian President Evo] Morales because they seek good will from the US [… They are avoiding] Chavez and Morales because these two leaders are part of South America’s political lunatic fringe who are going down in 2007.”

Ironically, Sullivan published this somewhat questionable analysis on the same day that the Associated Press reported that Moscow and Caracas had signed an agreement worth $15 million to cooperate in developing Venezuela’s natural gas resources. Though it is true that this agreement and other recent ones, like it are not the mega contracts worth billions of dollars in sales, it is likely that Sullivan may live to see those types of deals. But, in any case, the number of contracts between Moscow and Latin America continue to increase, and the combined numbers of them, in terms of revenue enriching the Kremlin’s coffers, are mounting up to real money.

On The Economic/Trade Front
Gradually, Russia is becoming a major trade partner for several Latin American countries. According to a January 11 report by Latin American News Digest, Russia has authorized imports of Chilean pork, poultry, lamb and beef and will soon be extending such purchases to include meat from Mexico. These imports are in addition to an already lengthy roster of products that Moscow is buying from producers throughout the region. For example, Peruvian fishery markets have soared in volume in the past year, with Russia being one of its main targets for Lima’s frozen fish sales, according to Peru’s Ministry of Production. Meanwhile, ADEX, Peru’s association of exporters, has reported that Peruvian grape exports rose to $29.3 million for the period from October to December 2006, which to large part is due to aggressively pursued increase in its shipments to the Russian market.

Regarding the region’s southern cone, Uruguay’s meat exports in 2006 have sharply increased principally as a result of growing exports to Russia. Moscow now accounts for 21.8% of Uruguay’s meat exports, according to data provided by that country’s National Meat Institute. In addition, Russia was the largest importer of Argentine horse meat in the first eleven months of 2006, at a figure of $27.3 million. The South American country also saw an increase in the revenue from its beef exports to Russia, Brazil’s main meat exporting destination, registering $132.14 million, up from $48.34 according to 2005-06 figures. Russia also accounted for some 51% of Brazilian pork exports in terms of volume and was the main pork export destination for Brazil in 2006. It is clear that Moscow is taking advantage of the income influx from its huge global oil and gas trade, putting it to good use by buying commodities from around the world. Not only is Russia importing a wide range of products from a number of Latin American countries, which satisfies the country’s political and commercial needs, but is also increasing its volume of exports to the region annually.

The Defense Industry
The prominent issue that has raised eyebrows in Washington is the robustness of Russia’s military defense industry and that the value of its exports to Latin America, including last year’s controversial sale of one hundred thousand Kalishnikov assault rifles to Venezuela was the largest in recent years. Chávez has also purchased 24 Su-30 mulit-role fighter planes, as well as 53 transport and attack military helicopters. The Associated Press, the Andean Group Report and other news services have reported that the overall cost of these contracts comes to around $3 billion. Regarding Venezuela’s recent arm purchases, the former commander of U.S. Southern Command, General Bantz J. Craddock, declared in September that “I think there’s an exporting of instability coming out of Venezuela.” Calling the instability “unfortunate,” Craddock went on to point out the “glut of money [in Venezuela] from oil. Money talks in a lot of parts of the world. It buys things, influence.”

Nevertheless, Washington’s preoccupation with Venezuela has not prevented Moscow from promoting military sales there as well as to other Latin American armed forces. At the time of the Kalishnikov sale to Caracas, the Washington Times’ Kelly Hearn reported that Russia was also considering a military sale to Argentina. Over the past year, several meetings have taken place between officials from both countries regarding the possible purchase of Russian-made military helicopters and armor-plated patrol boats. Peru is also revisiting former Russian military ties from the 1980s, by signing a deal with Moscow to repair and upgrade the Andean country’s Soviet-era Mi-8 military helicopter air fleet. Regarding Moscow’s former ties with Lima, the Latin American department director at the Russian Foreign Ministry, Alexander Dogadin, has no trouble saying that “Peru is our traditional regional partner, and we are broadening bilateral relations in various spheres.”

What’s to Come
During his trip to Nicaragua, Putin’s representative, Sergey Stepashin, declared that: “The countries of the region [Latin America] would like to have and count on the presence of a major power that has the necessary economic, military-technical, geopolitical, and scientific and cultural capabilities.” A similar statement was made by Ruslan Pukhov, who explained that: “[Russia supports] all countries that pursue in their regions independent foreign and defense policies without looking at Washington, obviously in hope to counterbalance the huge pressure the US and its regional allies are exerting on other countries.” Whether it is for political or commercial interests, Russia is certainly making a strong comeback in Latin America, with Venezuela as one of its lynch pins.

This analysis was prepared by COHA Research Fellow Alex Sánchez
February 14th, 2007
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