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ICG Risk Blog - [ "Cubazuela" with Russian arms, Chinese economic ties, powered by oil - or perhaps not ]

"Cubazuela" with Russian arms, Chinese economic ties, powered by oil - or perhaps not

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Part 3

It is interesting to see Chavez become a focus of regional challenge to US interests from a group of left of center governments in Argentina, Bolivia, Brazil, Chile, Peru and Uruguay, all nations that remain wary of Cuba even as they treat with Venezuela. Venezuela's impact is all the greater in that it can execute petroleum diplomacy initiatives moderate actions of regional states receiving Venezuelan oil, unilaterally fund FAN remilitarization and leftist groups such as the FARC and other terrorist groups.

Yet left-of-center has its gradations. The administrations of Brazil, Chile and Uruguay are more aligned on a Euro-socialist model less "left" than Chavez. Regional commentators have stated these states would not seriously contest Venezuela unless their national interests were threatened, a condition that I believe that Brazil has quietly recognized as the geopolitical effects of the "Cubanization" of Venezuela addressed in parts 2 and 3 become more extreme in their effects on South American states. Brazil (and Columbia) appears to be increasingly sensitive to Venezuelan support to the FARC whose narcotics and criminal enterprise exports are rapidly expanding out of Columbia and to the export effects of Venezuela's Bolivarian Revolution, e.g., Ecuador, Bolivia, Peru, and Nicaragua.

For its part, Cuba is clearly trumpeting agreements with Venezuela (beneficially priced oil and seconded advisors) and China (here and here) for its return from the brink of economic ruin, so one would assume that Havana will be able to sustain, even grow, its diplomatic activities, a condition that will not be lost on certain South American states. In April 2005 Petroleos de Venezuela (PDVSA) announced that it would manage its Caribbean region commercial operations from a new office in Havana that appears to have little or no economic advantage but significant regional political impact:

Between oil and coercion, the new headquarters is a move to isolate smaller Caribbean and Central American states into a Cuba-Venezuela axis... Since the countries will be dependent on Venezuelan oil from Cuba's capital, don't imagine any of those countries will try to cross Fidel Castro. The countries are small and numerous, but that's why their votes are so valuable to Chavez and Castro in international bodies like the Organization of American States and United Nations.

One wonders why observers would be surprised. Venezuela is 'self-propelled' in terms of having significant energy reserves to fund an often heavy handed petroleum diplomacy and Chavez, who has been described as mercurial, seems to have been consistent on petroleum:

Even before Chavez was first elected [in 1999] he was explicit in describing his views about petroleum. "Oil is a geopolitical weapon, and these imbeciles who govern us don't realize the power they have, as an oil-producing country."

Like Cuba, Venezuela will benefit by increasing Russian arms shipments for a combination of reasons:

  • Rosoboronexport (Russian Defence Export) hard currency sales are essential to sustaining Russian weapons R&D investment
  • Growing Indian and Chinese weapons sales will increasingly eat into Russian sales
  • The eventual lifting of the EU arms embargo on China will decrease Chinese purchases of Russian arms
  • Despite earlier agreements with the US and any diplomatic smiles between Putin and Bush43, I believe that there is sustained Russian distress over US penetration in the Russian near abroad and the Stans
  • While Russia actually benefits from Venezuelan development and extraction blunders in its energy sector, it would still have to have investment access in Venezuelan fields if for nothing else to reduce US opportunity

Part 5 conclusion

Hugo Chavez: Pirate Of The Caribbean
Venezuelan News and Analysis
From Investor's Business Daily/Investors.com,
May 20, 2005
21 May, 2005
[This citation has the map which many mirrors do not]

Latin American Allies of U.S.: Docile and Reliable No Longer
By CHRISTOPHER MARQUIS
January 9, 2004
New York Times
Original scrolled to
archive
Mirrored
here

Gordon Housworth



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