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Cablegate: Russia Increases Economic Activity in Latin America

VZCZCXYZ0001
RR RUEHWEB

DE RUEHMO #3106/01 2951409
ZNR UUUUU ZZH
R 211409Z OCT 08
FM AMEMBASSY MOSCOW
TO RUEHC/SECSTATE WASHDC 0456
INFO RHEHNSC/NSC WASHDC
RUEKJCS/SECDEF WASHDC

UNCLAS MOSCOW 003106

SENSITIVE
SIPDIS

E.O. 12958: N/A
TAGS: PREL PGOV MASS EAID ETRD EPET EINV ENRG RS

SUBJECT: RUSSIA INCREASES ECONOMIC ACTIVITY IN LATIN AMERICA

1. (SBU) Summary: Russia's intensified interest in Latin America
stems largely from economic opportunity, while serving to reinforce
its multi-polar concept of foreign policy. Following the Georgian
conflict, Russia has increased its activity in the region in order
to highlight its ability to extend its reach into the "U.S.
backyard." In meetings held with Latin American officials during
the 63rd UNGA and afterwards in Moscow, the GOR emphasized its
geo-strategic interest in fostering and improving economic and
political relations with this region, despite its geographical
remoteness from Russia. Subjects in these meetings ranged from
economic-trade relations, military-technical cooperation, space
technology, drug trafficking and terrorism, and discussions on ways
to strengthen political dialogue and cultural ties. New arms deals
with Venezuela continue to be reported in the Russian press, but to
date no new contracts have been signed. End Summary.

--------------------------------------------- ------
Bolstering Economic Ties a Top Priority for Russia
--------------------------------------------- ------

2. (SBU) Director of the Latin American Institute of the Russian
Academy of Sciences Vladimir Davidov told us that opening Latin
American markets for Russian business is GOR's top priority in Latin
America. Russia sees great potential for expanding economic
relations with Latin America, despite the challenge of geographical
distance between the two regions. Davidov argued that Brazil is the
most important Russian interest in Latin America, and the GOR
labeled Brazil its "key trading partner" in the region with trade
reaching USD 5 billion in 2007, according to Russian statistics. At
the UNGA on September 27 Lavrov met with Brazilian Foreign Minister
Celso Amorimo, and stressed Russia's interest in maintaining its
strong ties with Brazil, and on October 3 Lavrov and Brazilian
Foreign Minister Celso Amorimo released a joint article in the
Russian newspaper Rossiskaya Gazeta. In the article the two
ministers discussed the Russian-Brazilian friendship and "strategic
partnership." They emphasized the two countries' growing
relationship in the areas of trade, technology, space, and cultural
cooperation. Russia also re-iterated its support of Brazil's
candidacy for a permanent seat of a reformed U.N. Security Council.


3. (U) Russia's second most important partner in Latin America is
Argentina. Trade between the two countries reached USD 1.4 billion
in 2007. Argentine FM Taina led a delegation that included
businesspeople and met with Deputy Minister Denisov in order to
further develop trade relations. Similarly, Lavrov and Mexican FM
Patricia Espinosa Cantellano discussed ways to diversify their trade
basket to boost trade relations between the two countries during her
visit to Moscow October 7-9. Both ministers recognized that the
current trade relationship was far below its potential, reaching
only USD 700 million last year. While Russia speaks of increasing
trade with Latin America, Russia's current economic ties prove to be
less substantial than the GOR would like, and no concrete economic
deals were reached during these meetings.

4. (U) During the UNGA, Lavrov met separately with foreign ministers
of Cuba, Colombia, Nicaragua, and Venezuela. Lavrov met jointly
with three foreign ministers of the Rio Group: Mexico, Chile, and
the Dominican Republic as well as BRIC foreign ministers in New
York. While these meetings focused on increasing economic-trade
relations with Russia, Lavrov stressed Russia's interest in
strengthening bonds with its Latin American counterparts as part of
its multi-polar world vision, and as a means to counter global
issues like the current international financial crisis.

-------------------------------------------
Strategic Partnerships and Space Diplomacy
-------------------------------------------

5. (U) In their joint article Brazilian FM Celso Amorimo and FM
Lavrov noted mutual interest in maintaining space cooperation. No
new military or space cooperation plans were noted, however. Last
spring the two countries reached an agreement to develop a family of
launch vehicles for Brazil as part of Brazil's Cruzeiro de sul
(Southern Cross) program. Russian-Brazilian technological
cooperation is a lucrative collaboration for Russia, and serves
Brazil's long-term goal of building its own space program.

---------------------
Venezuela and Bolivia
---------------------

6. (U) Russian media continue to report on new arms deals with
Venezuela. On October 7 General Director of Rosoboronexport,
Anatoli Isaikin, told the press his company would enter into talks
with Venezuela, and on October 15 press reports indicated that
Rosoboronexport may sign a contract to send a shipment of BMP-3
armored vehicles to Venezuela next month. In reference to
Russian-Venezuelan arms cooperation, Lavrov told Rossiskaya Gazeta
on October 7 that Russia was not aligning itself militarily against
anyone, and was cooperating on the basis of international law.

7. (U) Russia will host an inter-governmental commission with
Venezuela October 27-29, which will serve "to facilitate increasing
cooperation and implementation of major joint initiatives,"
according to the GOR. During their meeting in Moscow, Lavrov and FM
Moros also discussed setting a date for proposed visits of Medvedev
and Putin to Caracas, with Medvedev possibly travelling to Venezuela
in November, according to recent press reports. This visit could
possibly coincide with upcoming Russian-Venezuelan joint naval
exercises to be held in November (septel).

8. (U) On October 2 press reports indicated that Bolivia plans to
purchase 5 Russian civil defense helicopters, although a price for
the aircrafts has not been set. Bolivia claims these aircraft would
be utilized for flood relief efforts, according to press reports.
Russia's ambassador to Bolivia Leonid Golubev told the press that he
would like Russian-Bolivian relations to "approach the level of its
partnership with Venezuela." Golubev also confirmed Russia's
interest in showing the U.S. that "Latin America is not their
backyard."

-------------------------------
Re-Connecting With Old Friends
-------------------------------

9. (SBU) In his meeting with Nicaraguan Foreign Minister Samuel
Santos Lopez, Lavrov expressed gratitude for the Nicaraguan decision
to recognize the independence of South Ossetia and Abkhazia.
According to Davidov, this decision is easily explained given
Nicaragua's previous relationship with the former Soviet Union.
During the Cold War, Nicaragua received economic support from the
U.S.S.R. and Davidov noted that some states still see the "Soviet
Union" when dealing with Russia, especially someone like President
Ortega. He thought it was likely that Nicaragua would leverage its
recognition of South Ossetia and Abkhazia to get Russian assistance
in receiving gas, possibly from Venezuela.

-------
Comment
-------

10. (SBU) While building stronger economic ties with Latin America
remains at the heart of Russian interests in the region, the GOR's
increased political outreach to countries like Cuba, Venezuela,
Bolivia, and Nicaragua reinforces its effort to pitch its
multi-polar concept of foreign affairs.

© Scoop Media

 
 
 
 
 
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