russia direct monthly memo | #12 | july 2014 · latin america has indeed risen.1 in the period...

Russian President Vladimir Putin’s upcoming visit to Latin America in mid-July, where he will participate in a BRICS Summit, is already attracting a lot of attention from Russia watchers. Latin America, largely ignored by the Kremlin during the 1990s, has emerged as a potential new partner for Russia as it searches for allies around the world in the aftermath of the Ukraine crisis.

Many states of the region are increasingly independent from the U.S. in their foreign policy and are willing to consider closer ties with Moscow. What follows is an analysis of the current state of Russia’s relations with Latin America, the potential for tighter cooperation, and the role of China and the U.S. in the region. The author is Ruslan Kostyuk of St. Petersburg State University.

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russia in america’s backyard | #12 | JuLy 2014

Russia in ameRica’s backyaRd

Ruslan Kostyuk,Professor, st. Petersburg state university

Recent events in ukraine have highlighted as never before

the continuing diversification of Russian foreign policy, as

Russia searches for potential new partners in regions far from

europe. of particular note here is latin America. Throughout

the 2000s, this region represented a growing area for the

kremlin in terms of expanding the reach of moscow’s foreign

policy. given the growing presence of the u.s. and nATo in

eastern europe, it’s perhaps no surprise that Russia is similarly

looking at ways to expand its presence in America’s backyard.

This monthly memo takes a closer look at why latin America is

emerging as a region of new geopolitical rivalry, examines the

strengthening military and economic ties between Russia and

latin America, and analyzes how china’s expanding presence

in the region might impact the political calculus of both the

u.s. and Russia.

ExEcutivE SummaRy

© R

iA n

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OvERviEwThe situation in latin America today is generally con-ducive to an expansion of Russia’s presence. At the turn of the 21st century, the region saw a drift to the left, which led many latin American countries away from the umbrella of the united states and towards developing their own more independent foreign and economic policies.

it is primarily the “Bolivarian Axis” countries that are tuned into a strategic partnership with Russia, which many in latin America perceive as the successor of the once powerful soviet union. launched in 2004 by venezuela’s Hugo chavez and cuba’s Fidel castro, this

socialist union known as AlBA (the Bolivarian Alliance for the Peoples of our America) is the most prominent anti-Washington alliance in existence. To date, AlBA consists of nine countries in latin America and the caribbean: Bolivia, venezuela, cuba, ecuador, nicara-gua, dominica, Antigua and Barbuda, st. vincent and the grenadines, and st. lucia.

many of the more moderate governments of this “left-ward drift,” in particular Brazil and Argentina, also ad-vocate expanding cooperation with Russia. To a large extent their views coincide with moscow’s desire to build a new world order, which should be multipolar and not biased in favor of one superpower.

moreover, even countries firmly tied to the north American economy, such as mexico and chile, where supporters of liberal, free market approaches to solving economic problems still hold sway, are showing a good deal of independence in promoting their politi-cal interests.

many academics note that these trends in latin America have forced moscow to take a fresh look at the prospects for cooperation in the region, which the kremlin practically shunned in the 1990s.

Latin amERica’S RESpOnSE tO thE EvEntS in uKRainE

The ukrainian crisis could not fail to increase the interest of Russian foreign policy experts in latin

GDP growth (annual %)

5.0

2.5

0.0

-2.5

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Latin America & Caribbean World Source: World Bank

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StREngthEning EcOnOmic tiES bEtwEEn RuSSia and Latin amERica

Any discussion of the impact of the ukrainian crisis on the development of economic relations between Rus-sia and latin America demands caution.

in recent years, cooperation between Russia and latin America has indeed risen.1 in the period 2004-2012, mutual trade between the two sides tripled in value from $5.8 billion to $16.4 billion.

Russia’s main trade partners in the region today are Brazil, mexico, Argentina and ecuador. Russian invest-ments in latin America are estimated at $25 billion (compared with $17 billion in the early 2000s), of which Brazil accounts for more than a third.

This trade covers a diverse range of economic sec-tors, including high tech, non-ferrous metallurgy, biotechnology and processing of agricultural raw materials. But it seems that in economic terms, Rus-sian capital is more interested in the energy sector, as domestic corporations such as gazprom, lukoil, and Rusal continue to build momentum with their latin American partners.

one can only expect the trade turnover between Russia and latin America to increase. What’s more, most south American countries are seeking to de-velop and improve their contracts with Russia in the energy sector.

However, according to Horacio yanes, one of the leaders of uruguay’s ruling Broad Front, latin Ameri-can countries do not expect Russia to challenge the u.s. and china economically in the region anytime soon.

Russian capital is welcomed by most latin American markets, but objectively, it is very difficult to compete with u.s. corporations and chinese conglomerates.

miLitaRy cOOpERatiOn bEtwEEn RuSSia and Latin amERica

it is more likely that ties between moscow and latin America will develop militarily (including joint opera-tions between air and naval forces) and politically.

Above all, this implies continued deliveries of Rus-sian weapons to latin America (including aircraft, armored weaponry and ships). Russian arms exports to latin America over the last 13 years were worth

Cuba

Mexico

Nicaragua

Venezuela

Brazil

Bolivia

Chile

Argentina

Source: UN voting record

Rejected

Abstained

Approved

Uruguay

Ecuador Paraguay

Guatemala

Haiti

Honduras

Dominican RepublicColombia

Costa RicaPanama

Peru

El Salvador

UN Crimea vote: How Latin America voted

America, if only because most countries in the region have not condemned the kremlin’s actions.

in late march, during the un vote on the “crimean resolution,” which called for the results of the crime-an referendum and any change in the territorial sta-tus of the Autonomous Republic of crimea to be ig-nored, the 11 countries that voted against included Bolivia, venezuela, cuba, and nicaragua — all mem-bers of AlBA.

meanwhile, the major regional players, such as Argentina, Brazil, uruguay, and ecuador, chose to publicly abstain during the un general Assembly vote. This absenteeism on the part of south America on the “crimean resolution” was a tacit sign of sup-port for Russia.

1 Sergey Lavrov. The New Stage of Development of Russian-Latin American Relations. The Ministry of Foreign Affairs of the Russian Federa-tion, August 24, 2011. http://www.mid.ru/bdomp/brp_4.nsf/e78a48070f128a7b43256999005bcbb3/a27d6f235094016dc32578f70042c31c!OpenDocument

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$14.5 billion, about 80 percent of which went to venezuela.2

The military factor in Russia’s partnership with latin America also emerged in April 2014, when the Russian navy and a number of left-leaning latin American countries held training drills off the coast of America. The exercises were designed to counter inter-national narcotics trafficking.

in march 2014 Russian defense minister sergei shoigu acknowledged that Russia was in talks to expand the number of its overseas bases with countries including venezuela, cuba and nicaragua. in other words, AlBA is seen as the primary target for the kremlin in terms of military-technical cooperation and foreign policy.

However, bilateral political contacts between Russia, Brazil, Argentina, and other more moderate govern-ments in latin America can also expect to see forward movement, since all parties are interested in multipo-

larity and the broadening of international relations. Therefore, over the coming years, bilateral agree-

ments are likely to be signed between these coun-tries for the purpose of framing a set of common approaches to key global political issues.

thE uS dOES nOt want tO LOSE Latin amERica

Washington can hardly have been blind to moscow’s explicit shift towards latin America under vladimir Putin. Former u.s. Permanent Representative to the organization of American states (oAs) Roger noriega, commenting on moscow’s increased focus on latin America, remarks: “The Russians are penetrating coun-tries that have been neglected by the u.s.”

indeed, during the two-term presidency of george W. Bush, the u.s. significantly weakened its political and economic influence in various zones across latin America, largely because the Western hemisphere was not a priority of u.s. foreign policy at that time.

during this period, America’s economic presence in the region declined: in 2000, 55 percent of latin American exports went to the u.s., in 2011, the figure declined to about 35 percent.3 Today, vigorous efforts are being made to reverse this trend.

As pointed out in “second chance” by Zbigniew Brzezinski, this period saw a rising “populist wave of anti-Americanism in latin America.”

since 2009, the democratic administration of Barack obama has tried to do all it can to regain Washington’s lost positions in latin America and to prevent certain countries there from falling into the orbit of Russia or china. From Washington’s perspective, the prospect of even temporary Russian military bases located in latin America is unacceptable.

over the past half-decade, the u.s. state depart-ment and affiliated structures and foundations have noticeably increased funding for latin American pro-jects. Washington is again showing considerable interest in the activities of the oAs, which was created by the u.s. back in the days of the cold War. Today, the oAs is quite a formal structure, uniting all countries in the Americas save for cuba, but Washington is doing everything it can to revive it.

The u.s. is channeling funds through various foun-dations and financial structures to the “democratic opposition,” primarily in venezuela. some analysts

Canada

42%

U.S.

37%

Mexico

28%El Salvador

27%

Venezuela

40%

Brazil

34%Bolivia

22%

Chile

39%

Argentina

26%

4520 -

Opinion of Russia, 2013Percentage who have a favorable view of Russia

Source: Pew Research Center

2 Business-TASS. Since 2001 ‘Rosoboronexport’ sold $14.5 billion worth of arms to Latin America. The Trade Mission of Russia in Brazil, May 13, 2013. (In Russian) http://bra.ved.gov.ru/news/?action=show&id=8307&prefix

3 CEPAL. Panorama de la inserción internacional de América Latina y el Caribe. 2000-2001, 2011-2012. Quoted in Petr Yakovlev. Geo-political shifts in Latin America. Perspektivy, 2013. (In Russian) http://www.perspektivy.info/table/geopoliticheskije_sdvigi_v_latinskoj_amerike_2013-05-03.html

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claim that Washington directly or indirectly facili-tated the change of power in Paraguay4 and Hondu-ras5 where conservative and u.s.-friendly forces have returned to power in recent years. Washington pro-vides systematic aid to anti-cuban political circles in central America.

Particular attention is being paid to mexico, Peru, co-lombia, and chile, which are tuned into the Pacific Alli-ance trade bloc, one of the most important tools of u.s. influence in latin America. Washington has free trade agreements with each of these countries, and con-ducts regular political and military consultations with

them, as well as with many smaller countries of central America and the caribbean.

As of today, u.s. can count 15 military bases in cen-tral America and the caribbean. As noted by Profes-sor Jose luis Fiori of the university of Rio de Janeiro, “Washington’s foreign policy in south America must be aimed at countering blocs and alliances that could weaken u.s. supremacy.”

on top of that, the obama administration is trying to avoid an unnecessary confrontation with the center-left governments of Brazil, Argentina, and uruguay. obama has tried to play down the recent nsA wiretap-

Cuba*

Mexico

NicaraguaVenezuela***

Brazil

Bolivia

Chile

Argentina

UruguayEcuador

Paraguay

Guatemala

Haiti**

Honduras

Dominican Republic

Colombia

Costa Rica

Panama***

Peru

El Salvador

9%1%

8%147

5.4%4.5%

11%22

5%4%

13%23

13%1.3%

16%466

8%0.1%

3%127

30%0.4%

11%115

40%0.1%

8%27

40%5%

3.5

2%1%

12.5%20

29%0.4%

5%19

2012 Foreign Trade (in Billions of USD),with percentage turnover for China,the U.S. and Russia

17%0.4%

20%153

14%0.1%

7%20

17%0.4%

17%87

35%2%

6%50

21%0.2%

15%37

48%0.3%

6%28

17%2%

5.5%10.5

43%0.2%

4%15

38.5%0.3%

4%26

67%0.3%

9%701

9%1%

8%147

Total foreign trade

- Turnover with China- Turnover with the U.S.- Turnover with Russia

Sources: Total foreign trade for each country was calculated using import and export data from the CIA World Factbook.Turnover with China, the U.S. and Russia was calculated based on import and export data from the World Integrated Trade Solution (WITS).

*Turnover with the U.S. equals U.S. exports to Cuba. Source: Congressional Research Service, 2014. Russia-Cuba turnover is based on data fromthe Russian Foreign A�airs Ministry.**Haiti's turnover with China was calculated based on data from Observatory for Economic Complexity(supported by The MIT Media Lab). Turnover with the U.S. was calculated using figures from the CIA World Factbook. No data was found for turnover with Russia.*** Data for 2011.

4 Nikolas Kozloff. WikiLeaks: Washington and Paraguay’s ‘Quasi-Coup’. Huffington Post, July 19, 2012. http://www.huffingtonpost.com/nikolas-kozloff/wikileaks-washington-and-_1_b_1683568.html

5 Eva Golinger. Washington behind the Honduras coup: Here is the evidence. Global Research, July 15, 2009. http://www.globalresearch.ca/washington-behind-the-honduras-coup-here-is-the-evidence/14390

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ping scandal, which caused a distinct cooling of rela-tions with Brazil.

At the same time, the u.s. is trying to prevent the expansion of the radical socialist movement, which is where AlBA’s allegiance lies.

u.s. exports to the region since 2000 have increased by $116 billion, reaching $304 billion in 2011.6 However, it is hard to ignore that latin America remains a headache for the obama administration.

china tOO iS EyEing Latin amERica

From an economic point of view, the main extra-re-gional rival to the u.s. is china. By 2014, the volume of china’s trade with Brazil, chile, and Peru had sur-passed America’s.

in fact, over the past 15 years, china has morphed into latin America’s main trading partner. on average since 2000, latin American exports to china have grown by 23 percent annually, although during the global financial crisis this growth declined per-centage-wise.

over 50 percent of exports to china come from copper, iron and soya beans, while Beijing is able to offer latin America electronics and automotive goods in return.

Boston university research officer Jill Richardson points out that china currently accounts for 13 per-cent of foreign direct investment in latin America.

china committed almost $100 billion to latin America between 2005 and 2013.7 overall, chinese foreign trade with latin America in 2014 hit $261 bil-lion. yet the chinese government has no intention of stopping there.

in particular, chinese analysts note that at present Beijing has free trade agreements with just three countries in the region, compared to Washington’s eleven.

one of china’s most recent iconic and high profile projects in latin America was its investment in the construction of the nicaragua canal, a proposed

shipping route connecting the Pacific to the Atlantic.china’s activity in latin America is disconcerting for

both the u.s. and Russia. As noted above, moscow is largely focused on military-technical and political co-operation with the region. The chinese, meanwhile, are wagering on the economic sphere, while simultaneous-ly developing amicable political ties. But china is ob-jectively ready to develop military forms of cooperation with latin American countries, both those that lean to the left and right, if it sees fit to do so.

what’S nExt fOR RuSSia in Latin amERica

Although latin America is hardly likely to turn into a playground of a new cold War, it is all too obvious that under the influence of the ukrainian crisis, Russia must at least consider the prospect of closer ties with latin America.

it is clear that latin America is of interest to Russia as a strategic ally in the Western hemisphere, an at-tractive market for Russian military products, and a potential supplier of everything from hydrocarbons to agricultural products.

The attitude of most latin American countries in respect to ukraine shows that they are not inclined to follow Washington’s every lead. even those nations politically and economically tied to the u.s., such as mexico, Peru, and the dominican Republic, are unwilling to sacrifice mutually beneficial coopera-tion with the Russian Federation over the events in ukraine.

it is in latin America where countries open to mili-tary and political cooperation with moscow are to be found. And it is here that Russia at the start of this century has succeeded in establishing good relations with most countries of the region. it remains to be seen whether Russia’s growing military and technical ties in the region can be expanded into broader and more sweeping economic relationships that would repre-sent a true threat to Washington.

6 CEPAL. Panorama de la inserción internacional de América Latina y el Caribe. 2000-2001, 2011-2012. Quoted in Petr Yakovlev. Geo-political shifts in Latin America. Perspektivy, 2013. (In Russian) http://www.perspektivy.info/table/geopoliticheskije_sdvigi_v_latinskoj_amerike_2013-05-03.html

7 The Economist. China lends disproportionately to countries that lack other options. April 12, 2014. http://www.economist.com/news/americas/21600686-china-lends-disproportionately-countries-lack-other-options-flexible-friends



1. evgeny Astakhov. The map of latin America in the 22nd century. Russian international Affairs council, July 12, 2012. (in Russian) http://russiancouncil.ru/inner/?id_4=602

2. marvin l. Astrada, Félix e. martín. Russia and latin America: From nation-state to society of states. new york: Palgrave macmillan, 2013.

3. vladimir davidov (ed). BRics – latin America: Posi-tioning and interaction. moscow: institute for latin Ameri-can studies (Russian Academy of sciences), 2014. (in Rus-sian)

4. luis Fleischman. latin America in the Post-chávez era: The security Threat to the united states. virginia: Potomac Books, 2013.

5. nikolas k. gvosdev, christopher marsh. Russian Foreign Policy: interests, vectors, and sectors. california: cQ Press, 2014.

6. sergey lavrov. The new stage of develop-ment of Russian-latin American Relations. The ministry of Foreign Affairs of the Russian Federation, August 24, 2011. http://www.mid.ru/bdomp/brp_4.nsf/e78a48070f128a7b43256999005bcbb3/a27d6f235094016dc32578f70042c31c!opendocument

7. Frances martel. Putin’s slow and steady Reconquista of latin America. Breitbart, march 20, 2014. http://www.breitbart.com/Big-Peace/2014/03/20/Putin-s-slow-And-steady-Reconquista-of-latin-America

8. carl meacham. is Russia moving in on latin America? center for strategic and international studies, march 25, 2014. https://csis.org/publication/russia-moving-latin-america

9. yuri Paniyev. Russia and nicaragua to cooperate on construction of interoceanic canal. Russia Beyond the Headlines, may 14, 2014. http://rbth.com/36645

10. vladimir sudarev. is Russia returning to latin America? Russian international Affairs council, February 20, 2012. http://russiancouncil.ru/en/inner/?id_4=252

@csisAmericasThe center for strategic and international studies (csis)

Americas Program analyzes the Americas from a fresh, global perspective, bringing greater awareness to the region’s role as a first-tier policy issue

@eric_latameric l. olson is Associate director for latin America Pro-

gram, Woodrow Wilson center, Washington, d.c.

@AscoAAmericas society/council of the Americas provides up-to-

date analysis of the contemporary political, social, and eco-nomic issues confronting latin America

@Theeiu_latAmofficial economist intelligence unit account on latin

America

@AmerQuarterlyAmericas Quarterly is a policy journal dedicated to news,

analysis and research of economics, finance, social develop-ment, and politics in latin America

@rbth_esnews and analysis on Russia-latin America relations in

spanish from Russia Beyond The Headlines

@gazetaRussanews and analysis on Russia-latin America relations in

Portuguese from Russia Beyond The Headlines

@embRusiamexicoTweets from the Russian embassy in mexico

@chrissabatinichristopher sabatini, editor-in-chief of @AmerQuarterly

and senior director of Policy of Americas society/council of the Americas, adjunct professor at columbia’s school of international and Public Affairs

@WolA_orgThe Washington office on latin America (WolA) is an

American non-governmental organization whose stated goal is to promote human rights, democracy and social and economic justice in latin America and the caribbean

REcOmmEndEd bOOKS and aRticLES On RuSSia and Latin amERica

tOp 10 twittER accOuntS fOR #RuSSia and #LatinamERica



Ruslan kostyuk (Ph.d. in History) is a professor in the Theory and History of in-ternational Relations department at st. Petersburg state university, as well as the head of the master’s program ‘History of international Relations in the 20th and 21st centuries.’ in 2000, he interned at the national institute of oriental languages and civilizations (Paris) and participated in a number of international conferences on european affairs in France. His research interests include the problems of world affairs in the 20th century, the history of european states, the history of soviet and Russian foreign policy and its role in the 20th and 21st centuries.

RuSLan KOStyuK

abOut thE authOR



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