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2 Apr, 2010 05:44

Putin visits Venezuela to talk energy, arms

Russia and Venezuela agreed to forge closer military and energy links as the Russian Prime Minister held talks with President Hugo Chavez in Caracas. Vladimir Putin has also approved a $2.2 billion loan to Venezuela.

“The Ministry of Finance reviewed the request and today I informed the Venezuelan President that Russia is ready to provide this credit to his country,” he said.

A deal to help Venezuela build its first nuclear power plant was also struck by Putin during his meeting with Chavez in Caracas.

While Russia and Venezuela share a lot of common interests, the Putin visit has been mostly focused on two aspects of their bilateral relationship: energy resources and military cooperation. The negotiations led to a number of agreements signed in these fields.

Russia and Venezuela have created a joint venture in order to explore oil fields in the Venezuelan Orinoco Belt. The venture, 60% of which will be held by the Venezuelan national petroleum company and 40% by an oil and gas consortium made up of Russian companies, is expected to pump up to 450,000 barrels of oil per day. It would allow both sides to significantly stabilize and influence the global energy market.

“This is a commercial and strategic partnership, basically. For Russia, Venezuela is a very attractive market in terms of selling Russian technology and weapons as well, and also in terms of energy cooperation. The key deal being signed between Vladimir Putin and Hugo Chavez [concerns] the Orinoco oil belt. That is probably one of the largest, if not the largest oil reserve in the world. But it's basically heavy crude, so you need technology to transform it into light crude – and Russia has it,” says journalist Pepe Escobar.

Grigory Volchek, press-secretary of Lukoil, one of Russia's major oil companies, says that Venezuela could be a model for future co-operation with Latin America countries and Caribbean states.

Russia and Venezuela are the two major and very serious players at the world energy market. And Russia could regard Venezuela as kind of a key model for future co-operation with other Latin American countries," Volchek said. “Using it as example we could plan our projects with Brazil – the new world economic giant, Argentina, Mexico, Columbia – where Russian companies have been successfully working for a number of years already, Ecuador, Uruguay, Paraguay, Chili and the states of Carrebian basin.

Military cooperation between Moscow and Caracas was the second matter topping the agenda. Russia has pledged to continue providing Venezuela with military equipment in order to support its self-defense.

Venezuelan lawyer and author Eva Golinger says the defense deals between Venezuela and Russia may lead to a shift in the balance of power in the region and affect US dominance.

“Venezuela had been sanctioned by Washington and sought other partners that were not subordinate to the US agenda and had their own defense technology. Russia has been one of the most consistent suppliers of different equipment to Venezuela – which was basically rendered debilitated by Washington because of the sanctions. I think it has been changing the balance of power for the last few years,” she told RT.

In addition, the Russian Prime Minister has finalized an agreement on the sale of 50 military and civilian aircraft to the Venezuelan side, among them BE-200 amphibian planes. Instrumental in Venezuela's fight against forest fires, these planes are a very welcome purchase.

“To gather water in order to put out a fire this plane does not have to land on the water’s surface. It gathers it while flying above the water. This increases the amount that can be dropped on to the hot spots of the fire and increases the effectiveness of these crafts. This is a unique plane; there is nothing comparable to it,” Prime Minister Putin said.

Venezuela’s will to arm itself has more to do with its image in general, rather than with self-defense, says Professor Pavel Baev from the International Peace Research Institute in Oslo, Norway.

“Deliveries of Russian arms played the role of increasing Hugo Chavez’ personal prestige,” he said. “The army was not created so much to threaten the neighbors, but to show the US that Venezuela is strong and capable of self-defense, because his main ideological conflict is not with his neighbors, but with the United States.”

Some, however, are concerned about such contracts.

The US State Department has said that it does not see why Venezuela should arm itself to such a level. It stated, though, that the Venezuelan leadership has the right to make any decision concerning its military and national security by itself.

Chavez himself has visited Moscow eight times already, while for Putin it was his first visit to Venezuela, which has already been labeled as “historic” by Chavez.

During the visit, the Russian Prime Minister also met with Bolivian leader Evo Morales, who arrived in Caracas especially for the occasion.

Moscow-based political analyst Maria Kusakina told RT that Russia and Venezuela are now forging closer ties, both economically and politically.

“This year the countries are celebrating 75 years since the establishment of diplomatic relations. However, it is only the last decade that has seen the real partnership,” Kusakina said. And if the first part of it is more about economic cooperation, we now see a strengthening of political cooperation.

“Last year, when President Chavez made a revolutionary decision to recognize the independence of South Ossetia and Abkhazia, he really converted into our political ally,” she added.