Arms and energy to dominate Chavez' visit to Russia

Venezuelan President Hugo Chavez has arrived in Russia on an official three-day visit. He is due to meet officials for discussions on co-operation in the fuel and energy sectors and to sign a series of deals for new arms supplies.

On his arrival, the Venezuelan leader had time to speak to the press, where he expressed his hopes for further co-operation with Russia.

“I am very happy to be in Moscow again. I greet President Putin and the Russian people with all of my heart. We arrived here with great hopes for unity and co-operation. We are very enthusiastic about the new Russia of the 21st century and its major role. We wish Russia happiness and the brightest of futures,” the Venezuelan leader said.

The visit comes a year after Chavez purchased $US 4 BLN worth of Russian weapons – a move that angered Washington who has imposed an arms export embargo on the country.

Venezuela – home of the Orinoco belt – holds the world's largest oil reserves, and has become one of Russia's main energy partners in South America.

At the beginning of 2007 the Venezuelan government embarked on a programme to nationalise the oil industry.  As a result of this policy the American oil company ExxonMobil announced recently that it was opting out of further co-operation with Venezuela. This might pave the way for Russia's Lukoil which is already conducting exploration works in Venezuela.

Russian gas giant Gazprom signed a $US 23 BLN contract with its Brazilian and Venezuelan counterparts to build a 10,000 km pipeline, set to be the largest oil project in the region.

Venezuela is also the world's second-largest importer of military hardware.  Several large-scale military contracts with Russia are expected to be sealed during President Chavez' current visit to Moscow.  Russia has already expressed an interest in taking part in the modernization of Venezuela's armed forces, which is expected to be completed by 2012 at a cost of $US 30 BLN.

The growth in Russian arms sales continues to dent the U.S.’s own market. Russian weapons are cheap and advanced. And since the U.S. slapped an arms export embargo on Venezuela for being uncooperative with Washington, Russia is the nation’s only choice.

Caracas is expected to buy up to nine diesel submarines as well as supplies of new armaments from Russia at an estimated cost of $US 2 BLN.

Meanwhile Ruslan Pukhov, a military analyst from the Moscow-based Centre for Analysis of Strategies and Technologies, believes that a major submarine deal between Russia and Venezuela is unlikely to be signed during Chavez' visit.

“Normally such huge contracts are kept secret before they're signed off.  Otherwise it could provoke a lot of resistance, both from nationals, from the opposition and from competitors of Russia on the world market.   So that is why I think this press leak definitely damaged Russian-Venezuelan relations in the arms trade. But I don’t think the deal will be cancelled, it will be put on hold. Venezuela is going to buy up to eight submarines. We estimate the deal to be worth up to $US 3 BLN. It depends on the equipment and on the bases which must be constructed. These deals are normally not negotiated for three or four months. Such deals are sometimes negotiated over a number of years. That is why, due to these two facts, I don’t think that we will see the signature of this contract during the visit of President Chavez,” he said.

President Chavez has taken part in inauguration of Venezuelan Cultural Centre in Moscow on Thursday. During his visit to Moscow, Hugo Chavez will also be meeting deputies of Russia’s lower house of Parliament, the State Duma, as well as businessmen.

And Konstantin Sonin, Professor at the New Economic School in Moscow, believes that Venezuela is the kind of country where the president's leadership matters very much for big business. To read full version of RT interview with Konstantin Sonin please follow the link

On the third day of his visit, the Venezuelan President will get to the city of Rostov-on-Don, where he is expected to visit a helicopter plant from which Venezuela bought a number of helicopters over the past few years.

The relationship between Venezuela and Russia continues to flourish as both sides seek to avoid the U.S.’s sphere of influence.

Besides economic interests, Russia and Venezuela share some common political ground.  Like Moscow, Caracas believes in a multi-polar world and might be looking for ways to curtail Washington's influence. Venezuela could also become a card Russia might play in diplomatic wrangling with the U.S.

Professor Emil Dabagyan from the Institute of Latin America in Moscow says President Chavez treats Russia as a friend.
 
“As soon as Chavez appeared on the political scene, he took an interest in Russia. And despite the fact that many think Russian-Venezuelan relations are all about weapons, I don’t agree. Long before arms deals were signed, Chavez expressed what he believed were the U.S.’s and Russia’s rightful places in the modern world. He said that Russia presides over Eurasia in the name of balance and peace. Chavez has maintained stability depends on a multi-polar world.  That is why he treats the U.S. as his greatest enemy and Russia as his good friend,” he claimed.