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Reference ID Created Released Classification Origin
07MOSCOW3139 2007-06-27 15:26 2011-08-30 01:44 CONFIDENTIAL Embassy Moscow

DE RUEHMO #3139/01 1781526
P 271526Z JUN 07

C O N F I D E N T I A L SECTION 01 OF 02 MOSCOW 003139 
E.O. 12958: DECL: 06/27/2017 
Classified By: Ambassador William J. Burns: 1.4 (b, d). 
1.  (C)  Summary:  The Ambassador expressed strong concern to 
Security Council Secretary Ivanov and Kremlin Foreign Policy 
Adviser Prikhodko over the visit of Venezuelan President 
Chavez to Moscow, June 28-30, on the eve of Putin's meeting 
with the President in Kennebunkport.  Noting that the visit 
was long-planned and not designed to send any signal, both 
Russian officials defended its basis on Russian arms exports, 
which appear to be the primary factor driving the red carpet 
protocol accorded to Chavez.  While eager to pursue 
commercial opportunities -- both in arms and energy -- GOR 
officials are realistic about Russia's influence in Latin 
America, although some see Russian activism in America's 
backyard as a counter to perceived U.S. encroachments in 
Russia's "neighborhood." Chavez's visit excites little 
comment here, where he is depicted in nostalgic terms as 
another Fidel, albeit one whose pocketbook provides a 
"pragmatic" basis for engagement.  End Summary 
Russia's Embarrassing Guest 
2.  (C)  In meetings with Russian Security Council Secretary 
Igor Ivanov and Presidential Foreign Policy Adviser Sergey 
Prikhodko, the Ambassador raised strong concerns over the 
visit of Hugo Chavez to Moscow on June 28-30 -- his fifth 
trip to Russia, and part of a broader swing through Belarus 
and Iran.  The Ambassador stressed, that on the eve of 
Putin's July 2 meeting with the President at Kennebunkport, 
the GOR was sending a negative signal through the high-level 
attention and protocol accorded to Chavez; his attendance as 
Putin's guest at the Presidential (horse racing) Cup in 
Rostov-on-Don (to which the CIS leaders and a swath of 
Russia's political elite are traditionally invited); and 
reports of another significant arms sale package, at a time 
when Chavez's policies were destabilizing the region and as 
news reports carried the Venezuelan leader's calls for 
military action against the United States. Both Ivanov and 
Prikhodko expressed regret over the timing of the visit, 
which was scheduled months earlier and was not (they claimed) 
intended as a signal to Washington. Stating that they 
understood the scrutiny that the visit would face in 
Washington and evincing no fondness for Chavez, both noted 
that Russia's arms export policy adhered to international law 
and UN resolutions. 
Arms Sales Top the Agenda 
3.  (C)  The MFA declined to discuss planning for the visit, 
but local press reports speculate that the primary agenda 
item is conclusion of another arms package, with the possible 
provision of nine diesel submarines (five Project 636 and 
four Project 677 Amur subs), Tor-M1 air defense systems, 
coastal patrol aircraft, and small arms touted.  (Note: We 
have seen Venezuelan Defense Ministry statements disclaiming 
any interest in submarines.)  With USD 3.4 billion in arms 
purchases since 2005, Venezuela now ranks as one of the major 
buyers of Russian weapons, with defense experts noting that 
Russia usually does best in restricted markets.  Ivan 
Safranchuk, Chief Defense Analyst at the World Security 
Institute, told us that expanding markets, keeping production 
lines open, and lowering unit costs by achieving economies of 
scale were the primary factors in engaging with Chavez. 
Russia's goal, he maintained, was to become an "arsenal" to 
fellow BRIC members (Brazil, India, and China), and Venezuela 
was an important entree into the Western hemisphere. 
Improvements in Russian weapons systems and Rosoboronexport's 
adoption of more "American" marketing techniques, which 
allowed Russia to offer complete packages -- equipment, 
training, and parts -- were contributing to Russia's 
increased appeal.  According to MFA Disarmament Department 
Counselor Sergey Petlyakov, there are few Russian 
restrictions on trade with Caracas and he reinforced the view 
that Moscow would be willing to meet Venezuela's demands, 
which were grounded in the defense of its oil facilities and 
other economic infrastructure. 
4.  (C)  Director of the Latin America Institute Vladimir 
Davydov told us that the Kremlin was realistic about the 
limits of its influence in Latin America in general and 
regarded the region as peripheral to Russia's strategic 
interests.  (Putin's visit to Guatemala, following 
Kennebunkport, is to further Russia's bid for the 2014 Winter 
Olympics.)  Putin had signaled this with the closure of the 
Russian listening station at Lourdes, Cuba, in 2000.  While 
Russian parastatals and private companies were interested in 
pursuing commercial opportunities -- particularly in energy 
and arms sales -- Davydov was dismissive of some of the 
grander infrastructure projects being discussed, such as a 
MOSCOW 00003139  002 OF 002 
pipeline from Venezuela to Argentina.  Russia's political 
interests in Venezuela were much more circumscribed; Moscow 
appreciated Venezuelan support in international fora, but was 
not seeking to act as a counterweight to
 the U.S. through its 
ties with Chavez. 
Memories of Fidel 
5.  (SBU)  Russian television coverage of the upcoming visit 
tends to portray the Venezuelan strongman in nostalgic terms, 
as a plucky populist in the Fidel mold, with little attention 
paid to his human rights record at home.  His defiance of the 
U.S. plays well on Russian television, and parallels are 
drawn by some commentators between his clashes with 
Conoco-Phillips and Exxon-Mobil and Russia's sometimes 
difficult relations with Western oil companies. Clearly, the 
opportunity to exercise Russian influence in America's 
neighborhood appeals to some Russian audiences, as well. 
6.  (C)  If Putin's body language during the fourth visit of 
Chavez to Moscow last year was any guide, there is little 
love lost for the Venezuelan leader.  However, there also is 
little public controversy over the red carpet being rolled 
out, with most officials and commentators prepared to defend 
Russia's "pragmatic" relations and commercial interests. 


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