VZCZCXRO8484
PP RUEHDBU
DE RUEHMO #4727/01 2691417
ZNY CCCCC ZZH
P 261417Z SEP 07
FM AMEMBASSY MOSCOW
TO RUEHC/SECSTATE WASHDC PRIORITY 4168
INFO RUCNMER/MERCOSUR COLLECTIVE PRIORITY
RUEHXD/MOSCOW POLITICAL COLLECTIVE PRIORITY

C O N F I D E N T I A L SECTION 01 OF 02 MOSCOW 004727 
 
SIPDIS 
 
SIPDIS 
 
E.O. 12958: DECL: 09/25/2017 
TAGS: PREL EINV ETRD XR RS
SUBJECT: FM LAVROV UNDERSCORES ECONOMIC COOPERATION AND "NO 
MORE BACKYARDS" IN LATIN AMERICA 
 
Classified By: Political Officer Bob Patterson for reasons 1.4 (b/d) 
 
¶1. (C) Summary. The MFA told us that Lavrov's September 11-13 
trip to Peru, Uruguay, and Paraguay focused on strengthening 
economic development of the region and projecting solidarity 
with countries instituting their own models of political and 
economic development.  Lavrov stressed in his public remarks 
that there should be "no more backyards."  The MFA noted that 
"unlike the U.S.," Russia received a formal invitation to 
attend the MERCOSUR summit in Uruguay in December.  With few 
deliverables, Lavrov concentrated on preparing a framework 
for future economic cooperation in the countries these 
countries and the region.  End Summary. 
 
¶2.  (C) FM Lavrov's September 11-13 trip to Peru, Uruguay, 
and Paraguay was Russia's first high-level visit to any of 
these countries since the fall of the Soviet Union.  He used 
the trip as an opportunity to increase bilateral cooperation, 
lobby for more investment and trade, and to soapbox familiar 
policy viewpoints on Kosovo, the UN, and the OSCE.  MFA Latin 
America Regional Affairs Section Head Igor Romanchenko 
accompanied Lavrov and told us in a September 19 meeting that 
the trip was official in nature, and not a working visit. 
The MFA considered the trip "successful and fruitful", noting 
that the GOR had achieved its goal of initiating high-level 
contact with "second-tier" countries and laying the 
foundation for further economic development. 
 
Peru 
----- 
 
¶3. (C) Romanchenko said Lavrov's September 11 visit to Peru 
followed on the heels of Putin's meeting with President Alan 
Garcia Perez at the APEC summit in Australia, and highlighted 
Russia's renewed economic interest in a country where trade 
has "lagged" compared with the rest of the region.  Peruvian 
political counselor Oscar Paredes Loza told us separately 
that with bilateral trade turnover at only 100 million 
dollars in 2006, both sides took "concrete steps" to improve 
trade.  For example, Russia is opening a commercial section 
at their embassy in Peru, and Peruvian vice-president Luis 
Giampietri Rojas will focus his upcoming visit to Moscow on 
trade and investment.  Although Peru traditionally used 
Russian weapons, Loza told us that arms trade with Russia was 
focused only on repairing existing weapons, not procuring new 
ones. 
 
¶4.  (C) Loza added that as a member of the UN Security 
Council through the end of 2007, Peru is currently trying to 
"balance" its position on Kosovo between Russia and the 
United States.  While Peru would like to use its time on the 
UNSC to improve relations with Russia, Loza told us they 
would side with the U.S. on many contentious issues for 
"economically pragmatic reasons."  Both Russia and Peru see 
APEC--Peru will host the 2008 summit--as the best 
multilateral forum for improving bilateral relations. 
 
Uruguay and Paraguay 
--------------------- 
 
¶5.  (C) Lavrov's September 11-13 visit to Uruguay highlighted 
the countries' 150th anniversary of diplomatic relations with 
the first ministerial visit since the fall of the Soviet 
Union.  Romanchenko noted that trade was again the main focus 
of Lavrov's meeting with President Tabare Vazquez, including 
discussion of Russian investment in Venezuelan President 
Chavez's proposed Southern Cone Gas Ring, other "more 
realistic" regional pipeline projects, the electricity 
sector, and commercial fishing.  Lavrov also welcomed 
Uruguay's treatment of its 10,000 plus community of Russian 
immigrants, highlighting the GOR's continuing priority of 
preserving Russian-speaking cultural enclaves abroad. 
 
¶6.  (C) In his visit to Asuncion on September 13, Lavrov 
marked the 15th anniversary of the resumption of relations 
and discussed the opening of a Russian embassy there by the 
end of this year.  Romanchenko said Lavrov explored 
investment opportunities in oil and gas, electricity, and 
infrastructure. 
 
Russia Seeks to Expand Influence in Latin America 
--------------------------------------------- ----- 
 
¶7.  (C) Romanchenko told us that Russia already enjoys 
"well-established relationships" with regional powers Brazil, 
Venezuela, and Mexico.  (Note: Russian trade with all three 
countries totaled $4.25 billion in 2006, excluding arms 
sales. End Note.)  Senior GOR officials, including Putin, 
regularly travel to the region to meet with the more 
prominent leaders, but Lavrov's trip signaled Russia's 
intention to strengthen ties with less developed countries. 
 
MOSCOW 00004727  002 OF 002 
 
 
Russia aims to deepen economic cooperation with these and 
other countries in the region.  However, Romanchenko admitted 
that the GOR has yet to convince a significant number of 
Russian businesses to pay more attention to Latin American 
markets. 
 
¶8.  (C) Romanchenko also underscored Russia's strong support 
of the developing "political trends" in Latin America.  He 
said Russia's calls for a multipolar world "dovetail 
perfectly" with Latin American countries' interest in 
"diversifying" their external relations.  He argued that 
Latin America is "correctly" cultivating its own development 
model and is moving towards greater integration in various 
regional organizations.  Romanchenko referred to Lavrov's 
September 12 speech in Uruguay that emphasized Russia's 
active support of a "diversity of forms" of democracy and 
market economy and the "real emancipation of sovereign 
states" from the shackles of "backyards" or "spheres of 
influence." (Note: Lavrov ironically noted that a "similar" 
process was unfolding in the CIS. End Note.) 
 
¶9.  (C) Director of the Latin America Institute Vladimir 
Davidov shared with us his assessment that the GOR is 
expanding its ties with Latin America mainly to demonstrate 
its ability to project power worldwide.  Davidov contends 
that although Russia's economic interest in Latin America is 
primarily a pretext for its increased activities, the GOR 
does not disparage the chance to create new investment 
opportunities and markets for Russian companies.  Leaders in 
these countries have signaled a political openness to 
strengthen relations with Russia, making this an opportune 
time for Russia to intensify contact. 
 
MERCOSUR 
--------- 
 
¶10.  (C) Romanchenko noted that, "unlike the U.S.," Russia 
received an invitation to attend the December MERCOSUR 
meeting in Uruguay, its second invitation in three years.  He 
added that Russia is interested in establishing a "memorandum 
of political dialogue" to formalize Russian relations with 
the group, pointing out that Russia will hold a meeting of 
MERCOSUR political directors in Moscow prior to the December 
meeting.  Both sides are also interested in an economic 
agreement that would elevate trade and investment, but 
Davidov cautioned that this still needed more work.  Davidov 
commented that the idea of a free trade agreement between 
Russia and MERCOSUR was not realistic in the short term. 
 
Comment 
-------- 
 
¶11.  (C) Lavrov's recent trip to Latin America indicates a 
genuine interest in new, if small and distant, economic 
markets for Russian investors.  However, Latin America will 
not be a major foreign policy focus for Russia anytime soon. 
For now, Russia seems content to expand gradually economic 
ties and, not exerting too much effort, lend moral and 
political support to anti-Western tendencies in the region. 
Russell