Reunion of old allies

The Cuban and Russian agreements presented during Vladimir Putin’s visit to Havana have in view strategic political and economic objectives.

In addition to attending the signing of agreements and memorandums of collaboration, Presidents Vladimir Putin and Raúl Castro held a public exchange that had great repercussion.

On a short stopover, Russian President Vladimir Putin’s July 11 visit to Cuba sent a clear sign of the intense geopolitical movement in which the Caribbean socialist nation has submerged itself.

In recent years, almost months, Cuba’s rapprochement to three countries has speeded up in an effort to establish a path less dependent on the traditional centres of political and economic power in the world. The trio, China and Brazil, in addition to Russia, are part of the BRICS group (together with India and South Africa), which around these days is creating its own bank with the aim of marking a distance from the hegemonic centres of the global financial architecture: the IMF, the World Bank and, in different structures, the Paris Club, the stock markets – Wall Street and London, mainly -, and the all-powerful U.S. dollar.

Those countries’ independence comes in very handy for Cuba, constantly harassed by successive U.S. governments through an economic blockade that, in times of the Barack Obama administration, has vented its fury on European banks involved in commercial transactions of Cuban accounts. Washington’s record fine on the French giant BNP Paribas some days ago – almost nine billion dollars – is just the most recent chapter.

Under the Putin administration, committed to recovering the sovereignty and economic power it lost after the collapse of the Soviet Union, Havana has strung together a series of agreements, between companies and governments, to build a new economic and political shield.

This time around, together with the agreement to write off 90 percent of Cuba’s debt with Russia – an ancient inheritance from the times of Soviet aid – there was a significant exchange of public messages between the Russian president and Cuban President Raúl Castro.

Putin clearly stated the intention of continuing to help Cuba in the face of the U.S. economic blockade, which he labelled as “illegal and illegitimate”. The Caribbean country, meanwhile, described as generous and decisive the aid received from the USSR, which it recognised as the origin of the debts accumulated by Cuba. “We can guarantee that” without that aid the Cuban “Revolution could not have survived,” it said. It also saw as generous the current Russian decision to almost completely write off the historic debt.The oil sector has again become one of the areas with the greatest perspectives of collaboration between Russia and Cuba.

“We are very pleased that in the international arena we coincide with the current policy of firmness and intelligent policy being carried out by Russia,” Raúl Castro said.

Both presidents ratified the announcement made in April by Russian Foreign Minister Sergey Lavrov during a visit to Havana that the remaining 10 percent of the debt, around 3.5 billion dollars, would be reinvested in the Caribbean nation.

Priorities, energy and Mariel

The guest had time not only to make promises during his short visit of barely 12 hours. He also attended with his host the signing of a great many juridical instruments that expand the bilateral collaboration programmed until 2020 which derived from the 10th meeting of the Intergovernmental Commission held in November 2012.

The 10 agreements and official documents confirm the close political, commercial, investment and financial ties between both countries.

With the signatures of both foreign ministers, Lavrov and Bruno Rodríguez, the collaboration in terms of international security of information was agreed upon, this being a particularly sensitive and controversial issue in the world of today. They also signed a Joint Declaration on the peaceful use of space.

Energy, with common experience since before the 1990s, was one of the privileged strategic objectives on this occasion.

The cooperation agreement between the Rosneft Company, one of the major oil companies in the world, and the Cuba Petróleo Conglomerate (Cupet) strengthened the collaboration already initiated between those companies in recent years. Geared at the development and better exploitation of the deposits and oil wells existing on Cuban territory, it seeks to equip the largest of the Caribbean islands with technology to enhance its production of hydrocarbons.

In terms of energy, companies from both countries also signed several memorandums of understanding; one to build four power generation units with a 200 MW capacity each, for the Máximo Gómez and East of Havana thermoelectric plants, at a total cost of 1.2 billion euros. And others to modernise and build hydroelectric plants, as well as to produce and install LED technology lights.

Ministers and members of the numerous Russian delegation and their respective Cuban counterparts, also signed documents to cooperate in areas of health and culture, and to create a Regional Rescue and Fire-Fighting Training Centre.

In addition to a memorandum to develop ties of industrial cooperation, Putin ratified Russian companies’ interest in investing in the Mariel Special Development Zone and assessed as very good the perspectives for cooperating in metallurgy, medicine, the pharmaceutical industry and biotechnology.The Mariel Special Development Zone has awoken the interest of Russian businesspeople, as indicated by the ongoing negotiations to invest in that zone.

“Russia is interested,” he added, “in installing on Cuban territory a land station for the Russian GLONASS navigation system. In this case the Cuban side will have access to the service and technology of probing the Earth from a distance.”

One of the most ambitious projects currently being studied by both countries is the development of a large regional transport hub in this Caribbean nation, judging by an interview given by the Russian president to the Prensa Latina news agency.  With the participation of Cuba, Russia and investments by other possible countries, the project “presupposes the modernisation of the port of Mariel and the construction of a modern international airport with a freight terminal in San Antonio de los Baños,” Putin said.

Statements and successive collaboration agreements seem to be encouraging for both sides, though mutual trade has still not taken off. According to the last version of the Cuban Statistical Yearbook that closed in 2011, that year bilateral exchange almost reached 300 million dollars, more or less the same level as during the previous five years. Russia ranks in 13th place among Cuba’s trade partners, according to the same source; very far away from other BRICS members like China and Brazil.

However, Cuba’s reopening to foreign investments, made official this year with a new law, the inauguration in Mariel of the first Special Development Zone, the growing interest of Russian businesspeople and Cuban politicians and the estimates of practical and strategic benefits for both parties, can offer a new model for the reunion of these former allies. (2014)

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