FEATURES OF RUSSIA—LATIN AMERICA TRADE AND ECONOMIC COOPERATION

Yan Burlyai,
Director of the MSLU Center for Ibero-American Programs, Distinguished Professor of the MSLU,
Ambassador Extraordinary and Plenipotentiary,

As of the end of last year, the economies of Latin America and the Caribbean (LAC) grew by 2.5%. Brazil’s GDP surged by 3% driven by higher consumer demand and investment, as the government introduced measures to support the economy. Mexico’s GDP increased by 1.5% as a result of a restrictive monetary policy. The only economy in the region to suffer a drop in GDP was Argentina, with a decline of 3.5%, whereas Colombia saw an increase of 1.6%, Chile 2.5%, and Peru 3.0%. Despite the turbulent global environment, the LAC economies showed good results.

According to UNECLAC, official unemployment remained at 7%, with inflation not exceeding 10% on average, except for Argentina (211%) and Venezuela (190%). The region’s economy still suffered from the West’s anti-Russian restrictive measures and secondary sanctions, which disrupted logistic chains and caused difficulties with mutual settlements. Among the LAC countries (33 States), only the Bahamas imposed sanctions against Russia, and Chile and Guatemala pursued policies aimed at reducing the scope of relations with Moscow. In 2023, Nicaragua entered into the Intergovernmental agreement on cooperation in the field of non-energy applications of atomic energy for peaceful purposes with Russia, and Cuba signed the Intergovernmental agreement on the state export loan to finance Russia’s oil, petroleum, wheat, and fertilizer supplies (up to USD 100 million). In spite of the obstacles imposed by the West, the Russian—Latin American trade turnover in 2023 generally retained the same level, with Russian agriculture exports (94%—wheat) in-creasing twofold. According to Brazil, Russia’s main counterparty in the region, trade volume between the countries hit a record USD 11 billion.

Latin America and the Caribbean is viewed today as a separate civilizational stratum—the region enjoys enormous potential and is steadily asserting itself as a stronghold of the multipolar architecture, while also being part of the World Majority. Such an emergence of the LAC as an independent pole in the polycentric global system meets Russia’s interests. In turn, the United States is persistently regarding Latin America as its “backyard,” expecting it to get involved in the global confrontation with Russia and China. Hence, the unprecedented pressuring of the collective West on the LAC region, particularly strong against states determined to defend their national interests, and the diversification of external contacts, including by expanding them with Russia.

Russia is building relations with the LAC states on a pragmatic, deideologized, mutually beneficial ground, sharing a common commitment to the principles of international law and respect for the cultural and civilizational diversity of the world and the right of peoples to determine their own political, social and economic models. Russia and Latin America are steadily developing the political dialogue. As for trade and economic cooperation, experts note that despite the anti-Russian sanctions imposed by the West and its ongoing threats to introduce the so-called secondary sanctions on the region, in spite of the artificial barriers to mutual settlements and supply chains, including food and fertilizers, Russia’s trade turnover with the LAC region has remained largely stable in recent years.

Trade with Brazil, as well as with Mexico, Ecuador, Argentina, Colombia, and Chile accounts for a significant part of it. Primary products of Russian ex-ports to LAC countries include fertilizers (complex, potash, nitrogen), food (mainly wheat), iron and unalloyed steel, oil and petroleum products. Meanwhile, Russia’s imports from LAC are mainly agro-industrial prod-ucts, including tropical fruits, frozen fish, tobacco, seafood, and peanuts. In 2024, Russian exports grew owing to increased supplies of crude oil, petroleum products, and complex fertilizers.

Imports from the LAC region decreased because of lower purchases of soybeans, tropical fruits, frozen fish, peanuts, and drugs. Latin American experts report that total exports to LAC in 2024 amounted to USD 2 billion, while imports were USD 14 million. In 2023–2024, five meetings took place within the framework of bilateral intergovernmental commissions (IGC): with Cuba (May 20, 2023, Havana, March 15, 2024, Moscow), Venezuela (October 16, 2023, Moscow), Brazil (February 27, 2024, Moscow), Bolivia (May 29, 2024, La Paz).

On October 16, 2023, the 17th meeting of the Russian-Venezuelan High-Level Commission hosted the signing of the Program of Cooperation in Tourism between the Russian Ministry of Economic Development and the Ministry of Tourism of Venezuela for 2024–2026. In 2023, Russia and Cuba drafted and signed four fundamental documents providing favorable conditions for Russian businesses to operate in Cuba:

• Framework Agreement on Cooperation between the Government of the Russian Federation and the Government of the Republic of Cuba on Encouraging Russian Investors to Participate in Russian-Cuban Projects in the Republic of Cuba;
• Program for Trade, Economic, Scientific and Technical Cooperation for 2023–2030 between the Government of the Russian Federation and the Government of the Republic of Cuba;
• Roadmap for Implementing the Framework Agreement on Cooperation between the Government of the Russian Federation and the Government of the Republic of Cuba on Encouraging Russian Investors to Participate in Russian-Cuban Projects in the Republic of Cuba;
• Plan of Development of Key Areas of Russian–Cuban Cooperation for 2023–2030.

The development of new logistics for exports and imports and alternative mechanisms of mutual settlements is the top priority for Russia and its partners. The implementation of bilateral projects with Latin American partners is ongoing: multistage construction and commissioning of the Centre for Nuclear Technology Research and Development in Bolivia; shipment of PAZ buses to Nicaragua; modernization of energy, metallurgy and railway infrastructure in Cuba; production of influenza vaccines at the Russian-Nicaraguan JSC “Mechnikov Institute” for supply to Venezuela, Cuba, Nicaragua, El Salvador, and Ecuador.

In Venezuela, Russia is setting up insulin production using its technologies. The focus is on forging stronger bonds with both regional States and their groupings, including through the EAEU. Its governing supranational body, the Eurasian Economic Commission (EEC), has concluded memoranda of understanding or cooperation with Ecuador, Chile and Peru, and a number of integration mechanisms— the Andean Community, the Latin American Economic System (SELA), the Southern Common Market (MERCOSUR), the Pacific Alliance, and the Secretariat for Economic Integration in Central America (SIECA).

Cuba is the only extra regional observer to the EAEU. In January, the EEC signed a Memorandum of Cooperation with Nicaragua. Venezuela is also striving for rapprochement with the Union. The key regional grouping for Russia is the Community of Latin American and Caribbean States (CEL-AC). Latin America seeks to revitalize its work by promoting a non-confrontational, primarily social, economic, energy and environmental agenda. The Russia-CELAC dialogue began in 2012, when the first meeting of the Russian Foreign Ministers and the CELAC Troika took place on the margins of the UNGA session in New York. On June 6, 2024, the Roscongress Foundation, as part of the XXVII St. Petersburg International Economic Forum, organised the Russia—Latin America business dialogue attended by more than 150 officials and businessmen of the region.

Russian and foreign participants discussed the current state of trade, economic and investment cooperation, including the implementation of joint strategic projects, identified new promising areas of collaboration, and measures to minimize the costs of logistical and financial constraints to increase Russia-LAC trade turnover. Relentless efforts are being made to promote Russian industrial exports and consolidate the positions of domestic economic operators in Latin America. Agreements on supply of drugs to the region are being implement-ed. JSC “BIOCAD,” for instance, carries out regular deliveries of antitu-mor drugs—Trastuzumab and Bevacizumab.

Since 2019, Russia is actively developing the project aimed at supplying and localizing the production of insulin drugs in Venezuela. Up to now LLC “GEROPHARM” has supplied more than 8.5 million packs of insulin, as well as syringe pens and needles for insulin administration worth more than EUR 63 million. On November 7, 2024, the Venezuelan plant “ESPROMED BIO” saw the launch of an insulin production line. JSC “BIOCAD,” having won the ten-der in December 2023, is planning to supply the antitumor drugs Bevacizumab and Rituximab to Cuba by the end of 2024. Late January—early February 2025, the project of SKD assembly of UAZ vehicles in Cuba is scheduled to start.

By the end of 2024, mobile equipment and a test batch of seven UAZ Patriot and Pickup vehicles are to be shipped to Cuba. In May 2023, an arcfurnace plant was launched under the project for modernizing and expanding the Antillana de Acero (Empresa Siderúrgica José Martí) iron and steel plant. This ensured priority use of Russian-made metallurgical equipment, including steelmaking equipment manufactured by JSC “VZMEO,” lifting cranes of LLC “NPO Spetskran” (former LLC “Optim-Crane”) and LLC “PF ASK.” The Antillana de Acero plant is currently being supplied with auxiliary equipment (pumping equipment, electrical systems, and 250-mill automation) for the rolling mill produced by JSC “EZTM,” and with specialized equipment to modernize and recon-struct of the water supply and mazut-handling systems. In 2025, LLC “GEROPHARM” plans to transfer the technology for producing genetically engineered human insulin to the facilities of the Venezuelan state pharmaceutical company “ESPROMED BIO.”

As for the project of SKD assembly of UAZ vehicles in Cuba, Russia is shipping equipment for the pro-duction line and test machine kits. In October 2024, the assembly of the Bukhanka UAZ-452 and the Pickup and Patriot cross-country vehicles began at the Cuban enterprise “EISA.” In October 2021, as part of the combined delivery scheme for 550 buses to the Republic of Nicaragua, 250 KAvZ-4238-61 buses and sets of warranty spare parts were supplied by the “GAZ Group” free of charge. Additionally, in the first quarter of 2023, Nicaragua received and distributed 300 PAZ buses, purchased under a commercial loan of EUR 16.83 million, they are now in operation across five provinces.

Discussions on the supply of another 450 KAvZ-4238-61 buses to Nicaragua under the same combined scheme are currently underway. An important aspect of the Russian—Latin American relations is cooperation in education, science, humanitarian aid, culture, and sports, as well as collaboration between ministries of internal affairs and ministries of emergency situations.

Such successful initiatives include: the Regional Russian-Cuban Center for Training Fire and Rescue Specialists in Havana, established with the help of the Russian Ministry of Emergency Situations, and the Regional Training Center of Russia’s Ministry of Internal Affairs in Managua, which provides professional retraining for police officers from Nicaragua and other regional countries. Russia is witnessing a steady increase of Latin American students coming on Russian state scholarships. In the 2023/2024 academic year, there were 4,600 such students.

The LAC region is popular among Russian tourists. Agreements to abolish visa requirements have been signed with 27 out of 33 LAC countries. In 2023, cooperation in tourism significantly intensified: tourist flow from Russia to Cuba reached 185,000 people, exceeding pre-COVID levels, and to Venezuela—20,000 people. In January-June 2024, 106,000 Russians visited Cuba (a twofold increase), and 6,300 visited Venezuela.

The abovementioned undoubtfully proves that there are numerous untapped opportunities and potential to further enhance and deepen Russia’s trade and economic cooperation with the LAC countries.