Russia Heads South, Moves into Former U.S. Markets


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Russia Heads South, Moves into Former U.S. Markets

By nabi abdullaev
Published: 13 Apr 19:55 EDT (23:55 GMT)

MOSCOW - Russia is advancing into the Latin American arms arena, staking claims in a market once dominated by the U.S. Russian analysts chalk up the progress to a better marketing strategy and political changes in the region.
"The main reason for expansion of [Russia's] military and technical cooperation with Latin America is that Russia offers its partners not only competitive weapons and military equipment, but also attractive terms to buy them," Viktor Komardin, deputy general director of state arms export monopoly Rosoboronexport, replied in written answers to questions.

Russia's Clients
Venezuela began the recent surge with multibillion-dollar contracts for Russian arms in 2005 and 2006.
Before that, Moscow's only substantial customer in the region was Peru. Between 1976 and 1992, Peru bought more than 60 Mi-17 Hip helicopters, 12 Mi-35 Hind E attack helicopters, three Mi-26 Halo heavy helicopters and 15 Mi-6 Hook helicopters, according to Oboronprom, Russia's government-controlled holding that unites the country's helicopter makers.
In the 1990s, Peru ordered three MiG-29 fighters, 30 R-77 air-to-air missiles and six Il-103 multipurpose aircraft. There were reports in the Russian media in the late 1990s that Peru was also eyeing Russia's Tor and Tunguska anti-aircraft systems, as well as the possible purchase of two Project 877EKM diesel-electric submarines. These deals were never officially confirmed, though, and the industry analysts doubted they would take place, given Peru's modest financial solvency.
Military cooperation with Peru got a new boost after Russian President Dmitry Medvedev toured Latin America last fall. In November, Oboronprom and the Peruvian Defense Ministry signed a contract to create a service center for Russian helicopters there.
In 2005-07, Venezuela ordered weapons from Russia worth $4.4 billion, including 24 Su-30MK2V Flanker fighters, Tor-M1 air defense missile systems, Mi-17B multirole helicopters, Mi-35 Hind E attack helicopters and Mi-26 Halo heavy transport helicopters.
The country also bought 100,000 AK-103 Kalashnikov assault rifles from Russia in 2005. With the addition of arms contracts signed in 2006 to early 2007, Venezuela has become the second largest importer of Russian weapons after Algeria, which signed arms deals with Russia worth $7.5 billion.
Last September, Russian government newspaper Rossiiskaya Gazeta reported that the Venezuelan military plans to buy six more conventionally powered submarines. Moreover, Caracas wants to acquire several dozen surface warships, including Project 14310 Mirage patrol boats, which are floating missile platforms that can destroy any ship seven to 130 kilometers away.
Venezuela is also negotiating the purchase of several dozen Ilyushin Il-114 patrol planes and has requested 10 Mi-28N Havoc attack helicopters to be delivered after July.
Venezuela also expressed interest in the new Su-35 fighter, due off assembly lines in 2010, Sergei Chemezov, chief of the Russian Technologies state corporation, said during a visit to Caracas in September. The two countries already signed a contract to create in Venezuela the technical centers to repair Russian military aircraft and helicopters and to train Venezuelan pilots, he said.
During a February visit to Moscow, Bolivian President Evo Morales signed a broad agreement on military and technical cooperation, with Russian officials saying then that Bolivia was going to procure multirole Mi-17 Hip helicopters. No other details were released.
Most recently, during the four-day visit of Chilean President Michelle Bachelet to Russia in early April, the Russian Interfax news agency cited a source in the arms export industry who said Chile has shown interest in new versions of the Russian Mi-35 and Mi-17 helicopters, the Ka*31 long-range surveillance helicopter, Buk-M1 and Buk-M2 air defense missile systems, Igla man-portable air defense systems, firearms and naval craft.
Russia and Chile signed intergovernmental agreements on military and technical cooperation in 2004.
And on April 7, Alexander Fomin, deputy director of the governmental Federal Service for Military and Technical Cooperation, told the RIA Novosti news agency that Russia is in talks with Brazil's Embraer over creating a plant there for licensed assembly of Russia's fifth-generation fighter, PAK FA, which Russia develops jointly with India. The maiden flight of the PAK FA is expected later in 2009.
Political Changes Help
Russia's latest advances on the Latin American arms market, which the senior Russian officials sometimes describe as a "breakthrough," have been aided by restrictions the United States attaches to its own military and technical cooperation with the Latin American countries, said Ruslan Pukhov, the director of the Center for Analysis of Strategies and Technologies, a think tank here. "Americans effectively pushed Chavez and Morales into Russia's arms," he said.
The analyst referred to the 2006 arms embargo announced by Washington against Chavez, whom it ac*cuses of supporting terrorist regimes and extremist groups, and the enforcement of the 1992 law allowing the United States to veto other countries' sale of military hardware built with U.S.-made components. The law effectively banned NATO countries from selling arms to Venezuela. Only Spain continued selling arms and military equipment to Chavez.
In another example, Pukhov said, the United States is blocking the sale of seven L-159 combat aircraft made by the Czech Republic to Bolivia. The news of the budding $58 million deal was reported internationally in January.
"Morales then will buy Russian, cheap and no strings attached," Pukhov said.
Also, Moscow's plans to provide Bolivia with helicopters follow La Paz' disputes with Washington over anti-narcotics efforts that badly strained Bolivia's ties with the Bush administration.
Morales expelled the U.S. ambassador in September and suspended operations of the U.S. Drug Enforcement Administration, which he accused of spying.
Moscow also has offered loans to help Latin American clients buy Russian arms. Chavez was given a $1 billion loan in September, and Russian officials in February spoke about the possibility of giving a similar loan to Morales.
Vladimir Davydov, director of the Institute of Latin America with the Russian Academy of Sciences, said that Russia's emergence as an independent global player in the past several years has coincided with the ambitions of Latin American coun*tries to seek global partners other than the United States.
"These countries know well what Washington can give them, and they naturally want to learn what Moscow has on offer for them," Davydov said. "And Russia, with its competitive arms industry and its strong desire to diversify its own arms markets, is seen as quite an attractive alternative to the U.S. when it comes to military and technical cooperation."