Category Archives: Bilateral Relations with Russia

Another one bites the dust

A couple months ago Argentine President Cristina Fernandez de Kirchner publicly endorsed Russia Today as an accountable and reliable source of news recommended to the Argentine public.

The close bonds between Kirchner and Putin forwarded the adoption of Russia Today in the country; Putin’s views being that the news site is one that is not biased like those news sources of “monopolistic countries,” aka the West, mainly the United States.

As the leftist movement in Latin America continues, Venezuelan President Nicolas Maduro this past week addressed the country that Russia Today is an excellent alternative news source. Venezuela is just another one of the Latin American countries, among Argentina and Nicaragua as examples, who have shifted away from U.S. relations turning to Russian partnership.

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Is Russia Really the Dark Power it is Presumed to Be?

With the introduction of glasnost (openness) and perestroika (restructuring) under the rule of Mikhail Gorbachev, the cohesiveness of the USSR was splintered eventually leading to its demise in 1991. The USSR was then broken down into 14 independent republics and since then “has shifted its post-Soviet democratic ambitions in favor of a centralized
semi-authoritarian state in which the leadership seeks to legitimize its rule through managed national elections, populist appeals by President Putin, and continued economic growth,” according to the CIA World Factbook.

Although about 1.8 times the size of the United States, Russia is a region that only houses  roughly a third of the U.S. population (143 million in comparison to a U.S. population of 316 million). The percentage of citizens that live in urban areas is whopping 73.8% as of 2011 according to the CIA WF.

In the backyard of Russia’s oil paradise: Pavlovo village was once a quiet backwater in the forest-steppe of Perm Region. In 1997, however, ecological disaster struck, with oil and chemicals entering the local river and food chain. Photo: ODR

Despite Russian predominance in world news, economically Russian industries are a failure, according to Texas A&M University professor of Russian, Brett Cooke. Following the fall of the USSR, which ended state-ruled enterprises, oligarchs seized these franchises. However, Russian industries never sufficiently adapted to the modern economy. Russia is comprised of a great expansive land mass, but because of its comparatively small population density, diversification of industrial growth has faltered. Today, Russia’s exports and economic wealth are reliant on the production oil related products.

“Russia produces oil, basically nothing else,” said Professor Cooke.

Professor Cooke proceeded to ask; why would Russia be importing agricultural products? Why from Latin America? According to the Observatory of Economic Complexity, Russia’s main imports aren’t even food related; the top imports consisting of goods such as: cars, packaged medicament, vehicle parts and computers.

The level of Russia’s food independence is stable, according to Tass, a Russian news agency. Russia’s main agricultural good is wheat. However, the country is lacking in other crucial food areas.

“…the level of self-sufficiency regarding certain types of dairy products (cheese, butter) was significantly below the required margin. Moreover, the figures of food independence concerning certain meat products, namely beef, were twice as low as the required margin.”

In recent times, Russian food security has been questionable due to Western sanctions implemented in August in response to the Crimea invasion; these sanctions have pushed Russia to realize its alienation. In the wake of these sanctions, Russia has doubled its imports of Argentinian beef (Global Meat News), while seeking out new strategic partners, which has been previously investigated in this blog.

Argentinian beef production company. Photo: Mercosur

Russia has allotted 1.5 trillion rubles ($42 billion) to invest in domestic agricultural production/development. Despite the investment, local producers are weary of the promise for greater production and efficiency within the country.

“It is extremely difficult to compete with foreign producers due to the investment factor in Russia, loans and infrastructure costs are much higher than in Europe and the U.S.,” said Artyom Belov, CEO of the National Association of Milk Producers, according to The Moscow Times.

Russian food sector. Photo: ITAR-TASS/Nikolai Alexandrov

This news from the agricultural sector only illustrates part of the problems facing Russia and the great depreciation of the ruble. Russia is seen as a dark illusive power, with an untouchable leader, Putin, at the head of the country whom steals the spot light and fills the tabloids of Western media. However, behind the Putin mask, the physically enormous country is vastly underpopulated and in a “time-freeze.”

Putin/Russia is painted by American media in three ways. Firstly, Russia is a country that reacts in a manner that is interpreted as it trying to maintain/regain influence over former Soviet spaces. Secondly, Russia wants to reemerge as a world power like during the Cold War times! And lastly, Putin reacts to the west in order to fight the spread of basic democratic/capitalistic ideals.

Recently with Putin’s visit to Latin America in July, the nation has shown that it is expanding beyond its former Soviet realm. Putin has sought to rekindle old flames while establishing new relations with countries such as Cuba, Nicaragua, Brasil, Argentina and Chile. During this “Latin American Tour,” Putin and his new presidential confidants discussed partnered development in sectors such as energy, education and trade.

Throughout the past century, countries such as Chile and Argentina received waves of fascists according to Professor Cooke. The first wave of fascist influenced Europeans landed in Argentina in the 1920’s. A reemergence of fascism later appeared with President Juan Peron in 1946.

In Chile, leaders such as Carlos Keller and Jorge Gonzalez Marees  transitioned Chilean politics and took a position similar to that of Adolf Hitler in 1932. Later in 1938 the country’s growing fascist movement attempted a coup; it inevitably failed. Starting in 1974 the infamous regime of Augosto Pinochet controlled the country under what were argued to be fascist ideals until 1990.

A rally for Argentine populist leader, Juan Peron, when the country faced difficult economic times and a series of unstable governmental leaders. Photo: Wikia

Virtually all countries in Latin America have faced movements from the spectrum of socialism to communism. Today there has been a steady movement back to populist ideals, ideals of which President Putin is found of.

This shift of relations has been caused by many things. One of the root issues being that the United States and other western nations have acted as if Russia no longer matters, says Professor Cooke. This isolation and ostracization has caused Putin and the country to react.

There is a great contradiction within Russia itself. Why should Putin be the select? Putin with a 65% approval rate in his country, greatly over shadows the reality of his nation. Professor Cooke, who has been to Russia more times than countable, commented not only on the centralization of the population in the cities, but also the isolation of the people themselves.

“The country [due to its governmental policies] has developed a separateness…and its people are out of touch,” said Professor Cooke.

Cooke expressed how there is no checks and balances, the current government under Putin stifles growth and the opinions of those appear to be heavily influenced or intoxicated with western ideology are targeted. The country itself is moving in a fascist direction, Cooke said in a worried manner. It has recently started with bans on alcohol, to curfew times within the cities…all things that appear to be good for the people.

However,  these policies have evolved into the banning of certain “alien groups.” The Putin administration has tried to dismantle one of the most prominent human rights groups in Russia known as the Memorial Human Rights group in Russia which has been threatened to be dismantled as it is an “alien agency.”

The statistics report that Putin is at a 65% approval rating, but this neglects the opinions of those who remain unheard. Article 80 of the Constitution of the Russian Federation states that,

“The President of the Russian Federation shall determine the guidelines of the internal and foreign policies of the State.”

Therefore, if Putin decides to ban western books from the country, arrest and condemn those who speak out against him or advocate for ideas that aren’t aligned with his political propaganda, he can rightfully create whatever policy he wants under the Russian constitution to silence these people.

  • Capturing of those in protest of Putin led government. Photo: Washington Post

Cooke compares the situation within the country to that of basic historical fascist leaders. Under Hitler the Autobahn was created and under Mussolini trains ran on time.

However, Cooke continues, “fascism is sloppy and mediocre.” It appears great at first until the efficiency of the system breaks down. Russia, like the situation of Germany before the rise of Hitler is feeling isolated and underestimated; inflation and violence have perpetuated the rise of fascism in the country.

The world sees the movements of Putin, but is ignorant to the realities of the country of which he represents.

“The alienation and sanctions have just started,” Cooke said.

Putin is represented on most propaganda of him riding shirtless on a bear is what inspires the Russian Putin followers and fuels the ideology of the power of the Russian nation. Russia perpetuates arms trade with the Middle East and has growing relations with China. However it is important to note the power switch of China in the globalized world.

China itself does not condone the intervention of one country into another country, case and point Russia’s seizure of Crimea. Power changes have happened in the past two decades with China moving to the top with the largest GDP in the world, however the Chinese dragon itself may not be as aggressive as once perceived.

Putin Propaganda

Russia will continue to create allies and seek relations with new partners such as those in Latin America, but the contradiction between governmental actions and media hype compared to the actual socioeconomic situation of the country are questionable. Maybe Russia is not the great dark power it is presumed to be. As Cooke mentioned, the people self regulate. The Putin regime may be stifling the checks and balances system, but eventually something’s gotta give.

Region with the Biggest Reserves Imports Oil

Venezuela, the country with the largest oil reserves in the world, 9th largest producer of crude oil and an OPEC member, will now be importing oil for the first time.

PDVSA (Petroleos de Venezuela S.A.) is the Venezuelan state-owned oil and natural gas company importing the oil. According the International Business Times (IBT), PVSDA was expected to receive its first ever shipment of light crude oil from Algeria. With oil being the Venezuelan government’s largest source of income, the importation of oil is rather peculiar.

“Oil production has declined over the years, exacerbating the country’s problems with a limited foreign currency supply, and critics say mismanagement of PDVSA is largely to blame. Meanwhile, global oil prices have slipped by more than 25 percent since June,” reported IBT.

Venezuela Oil PDVSA
Employees work on drilling rigs at an oil well operated by Venezuela’s state oil company PDVSA in Morichal. Reuters/Carlos Garcia Rawlins

Venezuela produces different types of oils, but its main product is known as an extra heavy crude oil. In order to process this oil, a diluent is needed, this diluent normally being light crude oil. Venezuela had been buying alternate diluents, as their light and medium crude oil stocks fell. The most common alternate diluent they used is called naphtha, a distillation liquid comprised of hydrocarbons, has become expensive in recent years. PVSDA had begun to think about the importation of light crude oil in order to reduce the expenditures used on naphtha, necessary for the processing of their extra heavy crude oil.

“PDVSA in August put on hold its exports of diluted crude oil (DCO) made of heavy crude and naphtha to review its cost structure and avoid losses amidst an oil market worried because of falling crude prices,” according to Reuters.

Despite earlier this year commenting that importing oil would be a “last resort,” energy minister, Rafael Ramirez and Venezuela turned to Algeria, fellow OPEC member. The country put in a 2 million barrel order shipment that was expected to arrive at the end of October.

Imports from Chinese Oil Company Out Of Russian Urals

Algeria was not the only country that Venezuela turned to, Petrochina, a Chinese state owned oil and gas company, has become of a part of the importation mix as well. However, the gas in question that is being exported is being extracted and produced in Russia. The Russian cargoes will be the second imports into Venezuela; PVDSA bought two cargoes of Russian Urals light crude oil from a unit of Petrochina. The exported are being attributed to Russia however being extracted by a Chinese corporation, reported by Reuters.

According to the Venezuelan administration, PDVSA produces close to 3 million barrels a day, making it one of the world’s largest crude exporters. With such a dependent economy on oil extraction, production, and exportation the largest crude oil reserves country in the world will have to deal with production problems in the face of slipping global oil prices and civil unrest.

Weapons para que?

Venezuela's President Nicolas Maduro.
Venezuela’s President Nicolas Maduro.                             (photo- RIA)

In the wake of protests last spring in Venezuela, the country grapples with growing international exportation demands, but also robust social and civil frustration. Venezuela faces a peculiar situation.

Is the country ready to become a renowned global competitor, or will it’s social imbalances and political strife lead it to the inevitable fall, that is expected of an unstable developing country? Despite the possible responses, Venezuelan President Nicolas Maduro is gearing up tackling both problems at the same time: promoting international arms trade by importing weapons while helping to control it’s unsettled citizens with force if necessary.

As Maduro acts on his own, following after Hugo Chavez, he has made recent deals to increase arms trade among Venezuela, Russia, and China. Maduro, who has spoken with Russian President Vladimir Putin and Chinese President Xi Jingping hopes to enlarge the country’s weapon supply with new cutting-edge equipment.

According to General Igor Korotchenko, at the Centre for Analysis of World Arms Trade, by 2015 Venezuela is expected to become the second largest importer of Russian arms in the world, total sales reaching up to $3.2 billion.

According to Ria Novosti, one of the largest Russian news agencies,

Venezuela received Russian air defense systems (Antey-2500, Pechora-2M, Buk and Igla) as well as T-72M tanks, Grad and Smerch multiple rocket launcher systems, armored vehicles and artillery.”

“Russia Today”: Bringing True and Credible news to Argentina

Video-Conference held between Russia and Argentina this past Thursday, October 9, 2014.
Argentine president, Cristina Fernandez de Kircher on the left speaking with Russian president, Vladimir Putin. (Thursday, October 9, 2014)

This past Thursday, October 9, 2014, Argentinian President Cristina Fernandez de Kircher and Russian President Vladimir Putin held a friendly video conference reaffirming their alliance.

The two not only spoke about their growingly warm relations, but as well about increased exports and imports between the two.  Argentina has recently become one of the main economies that have been aiding Russia while their country faces sanctions from the European Union, the United States, Australia, Canada, and Norway.

Buenos Aires based newspaper, Clarin, wrote that two best export products in recent months have been beef and dairy products.  In the first six months, Argentina has accumulated about 12.1 million tons of beef, about 75% more than the country had in 2013.

Argentine exports of dairy to Russia have grown about 43%; a 120% increase in cheese exports and 17% increase in butter, reported Clarin.

Besides these bilateral relations, people rejoiced in Argentina as “Russia Today,” a Russian news station will be the first international media in Argentina introduced in Spanish. That way, all the Argentinian citizens can stay updated with what is occurring in Russia, their country’s new found partner.  According to Radio Free Europe,

State-run satellite channel “Russia Today,” a major platform for getting the Kremlin’s message to audiences abroad, has extended its reach with the inauguration of Spanish-language programming in Argentina.”

The video-conference almost seemed too good to be true, as Putin occasionally would wave to the Argentinian audience with a “warm smile.” Fernandez and Putin both agreed on the importance and “historic” event of the introduction of RT (Russia Today) into the Argentine community.

Strangely enough, both seemed to be in agreement with the corrupt media portrayals of Russia and of world events, which skew reality. Website La Rouche Pac commented,

Interrupted by frequent applause from the audience, which included a contingent of young, cheering supporters, the event allowed the two leaders to express their firm commitment to their strategic alliance and cooperation on issues of national and international importance, while also condemning the global media cartels that distort reality, “according to their own interests.” Putin stated that the right to information is “one of the inalienable rights and one of the most important human rights,” but that the development of the electronic and social media in recent years “has become a frightening weapon that manipulates social conscience.” There is a real desire, he said, for media that doesn’t impose its opinions, but, like RT, allows viewers to form their own opinions by presenting them with a variety of viewpoints.”’

Putin also reflected on his pleasant July visit to Argentina and drew back to the point, that both countries share very common interests and would like to fight for their national rights. Argentina has not only become a nation for resources, but newly found geopolitical support for Russia.

“Cuba, where the Past and the Present Converge”

According to Euronews, 90% of Cuba’s debt to Moscow will be taken care of, about $29.53 billion and the remaining 10% ($3.29 billion), to be paid over the next 10 years. The remaining 10% also predicted to be invested directly back into sectors of the Cuban economy.

Russia plans specifically to invest in the development of Cuba’s Mariel Port, which is conveniently located 30 miles from Havana on the northwestern coast, situated in the Gulf Shore facing the United States.

According to NPR, in the 1980’s, ” it was the exit point for 125,000 Cubans who were desperately fleeing to Florida, some of them with assistance from the U.S. government. The Soviet Union was collapsing, and its aid to Cuba was withering. That, coupled with decades of U.S. embargo, was causing the island’s economy to nosedive.”

Now Mariel is a much quieter city, however that could soon change with the re-development of the port. The Mariel Port would be able to lodge some of the world’s largest cargo ships, with the help of Russian investment.

Russian Minister of Defense, Sergei Shoygu stated, ” that Russia would establish permanent bases in Cuba, Vietnam, Nicaragua, Singapore, and the Seychelle islands off Africa. The Russian navy also plans to visit other friendly countries, and Moscow is negotiating to open refueling stations for its strategic bombers.”

With Russia offering to cut off previous Cuban debt, there will be a much stronger resurgence of Russian influence within Cuba, just like in the olden days.

A Door Closes and another Opens

Due to the Ukraine Crisis and disapproval by the European Union of recent Russian actions, Russia has responded to EU sanctions by embargoing EU products. In turn this has pushed Russia to look for alternate sources of provisions.

Developing Latin America, with economies eager to expand has begun to welcome Russian as well as Chinese investment and trade negotiations. Although Brussels and other Western powers have urged against such increased relations, the opportunity to aid and support an entity such as Russia help aid in economic development.

Why wouldn’t certain Latin American countries take the chance to expand and create such a trade relation as the one being offered by Russia?

According to Reuters, Brasil jumped all in devoting 90 new meat plants to be geared to exportation for Russia. Brasil has also greatly began to increase its corn and soy bean sales to Russia.

Argentina as well jumped on board, sending members to Moscow in August to quickly sign exportation contracts. The eagerness of Argentina, deriving from the desire to increase revenues to stabilize it’s central banks reserves that have, ” fallen more than 5 percent over the last year to $28.968 billion,” reported by Reuters.

“Moscow has blocked food imports from the United States, the EU, Australia, Canada and Norway in retaliation for sanctions over the Ukraine crisis,” according to Reuters.

Chile, the leading economy within Latin America has also been reached out to by Russia to replace the EU’s supply of fish imports into Russia.