Putin’s Bold Power Play in America’s Backyard
Policy + Politics

Putin’s Bold Power Play in America’s Backyard

REUTERS/Maxim Zmeyev

The downing of Malaysian Airlines Flight 17 near the border of Russia and Ukraine, allegedly at the hands of Russian separatists, has gobbled up the attention of world media. It’s obscuring what amounts to Russia’s most audacious power play in the Western Hemisphere since the end of the Cold War.

Earlier this month, Russian President Vladimir Putin made a weeklong trip through Latin and South America. During the trip, he renewed alliance with some of Russia’s key Cold War allies while establishing Russian presence just miles from American shores.

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The stated purpose of the visit was to attend the BRICS summit of emerging economies — Brazil, Russia, India, China and South Africa. But with Putin, motivations are never straightforward. His trip is a clear show of force in America’s backyard.

Putin’s first stop was Cuba, where he visited with Cuban President Raul Castro and his older brother Fidel. While there, he signed an oil exploration agreement that allows Russia to explore for oil just a few miles off of American shores. He also forgave Cuba’s $32 billion Soviet-era debt. There were also reports that Putin discussed opening a Cold War-era Russian spy base in Cuba, a charge Putin halfheartedly denied.

“We will provide support to our Cuban friends to overcome the illegal blockade of Cuba,” Putin said on July 11. “Today, cooperation with Latin American states is one of the key and promising lines of Russia's foreign policy.” 

Then, he made an unexpected trip to Nicaragua, a country that had close ties to the Soviet Union under the Sandinistas. He was greeted by Leftist President Daniel Ortega, who discussed military cooperation, a possible base for the Russian Navy, and a joint venture with China to build a new canal through the country. The new canal would be a direct rival to the Panama Canal, long run by the Americans and still friendly to American interests. 

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The visit drew concerns from neighboring Costa Rica--a country without an army, which has long feared Nicaraguan ambitions. By treaty, the United States is obligated to provide military assistance to Costa Rica if needed, raising the possibility of a confrontation between American and Russian troops. 

Then, Putin visited Argentina, where he met with President Cristina Kirchner. Argentina, which has been locked out of international capital markets since defaulting on its debt in 2001, is desperate for foreign investment. The country is also facing the prospect of paying a $1.3 billion debt after a U.S. court ruled the country owed payments to "holdout" hedge funds that refused to take part in Argentina’s debt restructuring.

Putin offered some relief, promising that Rosatom, the Russian atomic energy corporation, would help Argentina to build a nuclear power plant. Members of the Russian delegation also visited Argentina’s Vaca Muerta shale oil and gas fields, one of the largest unexplored deposits in the world.

The last stop on Putin’s tour was Brazil, where he took in the world Cup final, an event Russia will be hosting in 2018. He then announced the formation of the $100 billion BRICS Development Bank, created as an alternative to the International Monetary Fund and to provide loans to developing countries.  

Related: Why Europe Is Hesitant to Punish Russia

Putin used the occasion to take a swipe at the United States, which had just issued new sanctions against Russian individuals and companies.

“The measures taken by the US administration towards Russia, in my view, contradict the national interests of the United States,” Putin said. “This means that, for example, large companies wanting to work in Russia after facing certain restrictions will lose their competitiveness compared with other global energy companies.”

“We're open to finding ways out of this situation,” the Russian president added. “I really hope that common sense and the willingness to resolve all issues through peaceful diplomatic means will prevail.” 

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