Russia set to re-enter Latin American markets



MOSCOW. (RIA Novosti political commentator Andrei Fedyashin) - On November 22-23, Russian President Dmitry Medvedev attended the 16th Asia-Pacific Economic Cooperation (APEC) summit in Lima, the capital of Peru, and subsequently paid an official visit to Peru November 24.

Through November 28, President Medvedev will also visit Brazil, Venezuela and Cuba.

The Russian leader's visits to these four countries are even more important than the APEC summit, because APEC is just a top-level discussion club, whose members are under no obligation to abide by any contractual-legal commitments or regulations or to implement specific declarations being passed by consensus. In effect, all APEC decisions are purely voluntary.

The latest APEC summit was held in the wake of the G20 summit in Washington that achieved general agreement on how to cooperate in key areas to strengthen economic growth, deal with the financial crisis, and lay the foundation for reform to avoid similar crises in the future.

The Group of Twenty Finance Ministers and Central Bank Governors (G20) includes officials from 20 economies: 19 of the world's 25 largest national economies, plus the European Union, comprising 90% of global gross national product, 80% of world trade (including EU intra-trade) and two-thirds of the world population.

Unlike previous APEC summits, the latest meeting passed two documents, namely, the Lima political declaration and a special economic statement stipulating commitments in 12 areas. The 21 summit delegates, including 10 G20 members, supported the G20 summit's decisions.

APEC, which was established in 1989, comprises 21 countries and territories, namely, Australia, Brunei, Vietnam, Hong Kong, Indonesia, Canada, the People's Republic of China, Malaysia, Mexico, New Zealand, Papua New Guinea, Peru, Russia, Singapore, the United States, Thailand, Taiwan, the Philippines, Chile, South Korea and Japan.

The 2012 APEC is scheduled to be held on Russky Island near Vladivostok in Russia's Far East.

The Lima summit pledged to liberalize trade still further and to make headway on the Doha Development Round, the current trade-negotiation round of the World Trade Organization (WTO), which commenced in November 2001.

Although APEC has been promising to continue the Doha Development Round, it has still achieved little in this respect.

APEC leaders also pledged to contribute more to the International Monetary Fund (IMF), to fight the global economic crisis and high-seas piracy, the latest challenge facing humankind. But it was decided not to introduce any new protectionist measures in the next 12 months because at present there are more than enough trade barriers.

The final Lima declaration says it will take 18 months to overcome the current crisis. This provision was allegedly included at the insistence of Peruvian President Alan Garcia.

President Garcia has found himself in an involved situation made worse by the global crisis. The people of Peru are suffering from inflation and poverty, and becoming more discontent with his extravagance.

The Peruvian leader, who leads the Alianza Popular Revolucionaria Americana, a left-wing political party, is now supported by just 19% of the population, but wants to run for president again. Consequently, he wants to demonstrate economic successes and to set a deadline for ending the crisis.

President Garcia ranks among other leftist or moderately leftist Latin American leaders now ruling many South American countries. Nonetheless, he has already managed to quarrel with the firebrand Venezuelan President Hugo Chavez and Bolivia's Evo Morales.

Regardless of who rules Peru, Moscow has maintained strong relations with Lima since the late 1970s. Numerous Peruvian students enroll at Russian universities. The country's armed forces still have Soviet-made weapons, including Russian helicopters.

Russian-Peruvian military-technical cooperation will continue. Moreover, Russia is ready to conduct joint prospecting operations in Peru and to help develop local oil deposits.

To be frank, oil and gas cooperation is a major aspect of the Russian president's foreign visits.

Brazil, a member of the BRIC group, which also comprises the rapidly developing economies of Russia, India, and China, is no exception. Moscow is ready to expand ties with this country, which is called a separate continent by other Latin American nations.

President Medvedev will visit the headquarters of Petrobras, or Petroleo Brasileiro S.A., a semi-public Brazilian energy company in Rio de Janeiro. He will also meet with the CEOs of state-owned and private companies working in the energy, ore-mining, agro-industrial and banking sectors.

Russian energy giant Gazprom is set to open a Brazilian office next year. Moscow and Brasilia are also ready to expand bilateral cooperation in the field of space research and to build a space center near the Equator.

Moscow considers Venezuela a high-priority partner. Hugo Chavez has established strategic partnership relations with the Kremlin. Both countries are setting up a joint bank with a $4 billion statutory capital for financing oil refinery construction.

Russia is ready to help Venezuela with nuclear power plant construction. RusAl (Russian Aluminum), the world's largest aluminum company, has announced plans to build an aluminum plant in Venezuela.

Russia's largest automaker, AvtoVAZ, is prepared to build assembly plants in the country.

Since 2005, Caracas and Moscow have signed 12 arms sale agreements stipulating the delivery of Kalashnikov assault rifles, T-90 main battle tanks, armored personnel carriers, Sukhoi Su-30 fighters and helicopters worth $4 billion. Venezuela also wants to buy submarines and warships from Russia.

On November 25, presidents Medvedev and Chavez will open the first large-scale Russian-Venezuelan naval exercise, due to last through November 30.

The Russian leader will also visit Cuba, especially since bilateral relations are receiving a new lease of life. Both sides are to sign documents stipulating cooperative oil-prospecting operations within Cuba's international boundaries in the Gulf of Mexico. Experimental wells are currently being drilled there.

President Medvedev's visit highlights Russia's increasingly de-ideologized relations with Latin America. Frankly speaking, mutual relations have always been marked by serious national-pragmatic considerations. Suffice it to say that Lada cars became the most popular motor vehicles in Chile under the then dictator Augusto Pinochet (1915-2006).

The administration of George W. Bush has also de-ideologized relations with Latin America to the extent possible. Since 2000, Washington has virtually ignored every Latin American nation south of the Panama Canal except Mexico.

U.S. officials who are scaring Americans with Russia's assertion in South America overlook the fact that Washington supported most South American dictators but then unexpectedly started ignoring its own "backyard."

It was Latin America who invited Moscow to cooperate. In fact, Russia didn't have to do much to be a part of politics there.

We should not have any illusions about Russia's Latin American foray because the United States will never leave the region and because it will restore ties with nations that have hit an all-time low under President Bush.

Although Barack Obama will facilitate this process, it will take some time to reinstate mutual contacts because the next U.S. administration will first have to deal with the global economic crisis and the wars in Iraq and Afghanistan.

The opinions expressed in this article are the author's and do not necessarily represent those of RIA Novosti.

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