Friday, November 24, 2006


Russia, Second Time Around

Cuban economic links with Russia and other ex Soviet Republics did not disappear completely with the dissolution of the USSR, although they were sharply cut as of 1992. Russia kept on being the island´s number one market for its sugar exports and main oil supplier until Venezuela came along to take its place.
Almost 15 years after Cuba´s worst trade quake, Russian companies are trying to take over where they left off. After all, most cars, trucks and tractors rolling on the island´s roads and fields are Russian, Bielorussian or Ukrainian-made. Dozens of factories and power plants have Russian technology and machinery installed, with its load of inefficiency and higher energy consumption than international standards allow today.
Russian businesses have learned their lesson. Unable to compete in the world market without meeting those standards, Russian industry is now offering updated equipment and vehicles which have been seen in the last two Havana International Trade Fairs. No more freebies for Cuba, but contracts on reasonable terms and supported by credits, more than can be said for many other suppliers.
The recent visit of executives from 30 enterprises among the largest in Russia in the energy, aviation, mechanical industry, tourism, land and sea transportation sectors confirmed the interest in doing business with Cuba and eventually, use the island to introduce their products and services to the Latin American market.
Vilem Hakobian, representing the Russian part in the bilateral Business Committee, said trade turnover could be much higher and cooperation potential as well as investments are not negligible. According to Alejandro Mustelier, chair of the Cuban part, reported there are 79 Cuban companies participating in negotiations with their Russian counterpart.
Already 30 areas of cooperation have been defined, suppliers of consumer goods, raw materials and spare parts, among others. Mustelier also advanced there are Russian companies interested in investing in tourism, health and telecommunications. Cuba is receiving offers from the oil and mechanical industries, as well as from land, air and naval transport companies.
Another unwritten commitment is that the Russian military industry is interested in updating Cuban weaponry and substitute the old equipment for new, subject taken up during Mijail Kalashnikov´s trip earlier this year. On that occasion, Kalashnikov also signed an agreement with Venezuela to supply 100,000 rifles that bear his name. Contracts with Venezuela amount to $3 billion dollars.
These actions promoted Russian weapons before other Latin American countries, region that has become the first client of the Russian military industry. Over the last six years, Russian exports of weaponry and equipment have doubled.
Aiming to consolidate their part in this market, Moscow will supply fighter planes Sukhoi to Mexico and Brazil, reported RIA Novosti news agency on November 7.
As for Asia, the second Weapons and War Material Exhibition in Jakarta in November stresses the presence of Russian weapons and equipment for naval forces, according to the company Rosoboronexport.
In Africa, the president of Rosoboronexport also recently signed contracts with Algeria for 7.5 billion dollars.
Since Cuban military involvement in Africa, with victories in the Ethiopia-Somalia conflict and the Angola war, Russian weapons went up in the preference of developing countries, on very favorable payment conditions.
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