Venezuela and Russia Sign New Accords, Highlight Sharp Growth in Commercial Relations

Venezuela and Russia continued to deepen bilateral relations with the signing of new accords in energy, housing and agriculture yesterday, while Russian Prime Minister Vladamir Putin highlighted that this year commercial exchange between the two countries has seen a ten-fold increase.

By Ewan Robertson – Venezuelanalysis.com
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Venezuelan Vice-President Elias Jaua (left) with Russian Prime Minister Vladimir Putin (AVN)
Venezuelan Vice-President Elias Jaua (left) with Russian Prime Minister Vladimir Putin (AVN)

Mérida, 9th December 2011 (Venezuelanalysis.com) – Venezuela and Russia continued to deepen bilateral relations with the signing of new accords in energy, housing and agriculture yesterday, while Russian Prime Minister Vladamir Putin highlighted that this year commercial exchange between the two countries has seen a ten-fold increase.

The agreements were signed at the close of the VIII High Level Meeting of the Venezuela-Russia Joint Commission, which took place on Wednesday and Thursday this week in Moscow.  The summit brought together representatives of both governments in 10 working groups ranging from technical-military cooperation to sport and culture.

Key accords include opening a new US $4 billion dollar line of credit from Russia to Venezuela, and a commitment to jointly build 30,000 houses within the framework of Venezuela’s mass house building program, the Great Housing Mission. As part of this commitment, Russia will also participate in the industrialisation of Venezuela’s growing construction sector.

Another accord focuses on the continued development of the Russia – Venezuela Bi-National Bank, increasing its capacity and capital. Founded in 2009, the Bank promotes financial cooperation between the two nations and funds joint development projects.

Venezuelan Vice-President Elias Jaua, who headed the Venezuelan delegation, said at the beginning of the summit that defining the statutes of the Bank was one of the most important issues of the bilateral meeting.

“We have come with a lot of enthusiasm to continue advancing and deepening what are already strategic relations in diverse areas” he added.

In energy, Venezuela’s state oil company PDVSA and Russia’s Gazprom signed a memorandum of understanding with the intention of forming a mixed company to explore and exploit the Robala gas deposit in the Gulf of Venezuela.

Growth in Commercial Relations

After a meeting with Jaua at the end of the summit, Vladimir Putin highlighted the recent growth in commercial relations between Venezuela and Russia, stating “I wanted to mention a statistic: from January until September this year commercial exchange has increased tenfold”.

Both Jaua and Putin committed to continue developing relations in this area and others, with Putin adding “we have great joint projects that are being developed and diversified in different spheres”.

The comments came after new accords were signed in the areas of commerce and agriculture. These allow for increasing the import of buses to Venezuela from Russia, and the joint production and export of flowers, plantains, cereals and biopolymer plastics from Venezuela to Russia and the wider world.

The accords build on agreements made at the previous Venezuela – Russia bilateral meeting, which took place in Venezuela in October. Since then, the first shipment of 4,000 flowers from Venezuela has arrived in Russia, with another 130,000 to arrive in the coming days.

Russia Welcomes the Birth of CELAC

Russia also greeted the founding of the Community of Latin American and Caribbean States (CELAC), a new regional grouping which brings together every state in the Western Hemisphere apart from the United States and Canada.

The founding summit was hosted in Caracas, Venezuela, last 2 and 3 December. Many of its members see the organisation as the replacement for the US-dominated Organisation of American States (OAS).

Spokesperson of the Russian Foreign Ministry Alexander Lukashevek stated on 4 December that the formation of the new regional organisation is part of the process of forming a multi-polar world and strengthening the role of regions on the global stage.

“We greet this emblematic step that our Latin American partners have made, which is a new test of the desire of the countries and peoples of Latin America for unity and the consolidation of their identity,” he continued.

China also sent a letter to the CELAC founding summit welcoming the new organisation, with the message of congratulations from Chinese president Hu Jintao read out by Venezuelan President Hugo Chavez during the first plenary session with all 33 invited heads of state.

For its part, on 2 December a United States State Department spokesperson referred to the CELAC as a “sub-regional organisation,” continuing that, “we continue, obviously, to work through the OAS as the preeminent multilateral organization speaking for the hemisphere”.