Cuba-Venezuela Relations

                 - Dr. Abdul Ruff Colachal

*****

A day before Cuba hosts a summit of the regional political and economic bloc, the Bolivarian Alliance for the Peoples of America (Alba), which was founded by the two nations five years ago as a radical alternative to America's free trade policies in the South America, Cuba's President Raul Castro and his Venezuelan counterpart Hugo Chavez have on Dec 13 signed economic co-operation deals worth $3.2bn (£1.96bn). The documents cover 285 accords in areas including energy, sport and technology. The new deals will give Venezuela a greater involvement in oil exploration off the Cuban coast. Cuba also agrees to buy more than $400m (£246m) worth of Venezuelan goods, including food, tyres and clothes.

The deals also underscore Venezuela's role as Cuba's closest political and commercial ally and comes as Raul Castro struggles to cope with the global economic crisis. The island has suffered a sharp decline its revenues from tourism as well as mineral and tobacco exports. Venezuela - an OPEC member - is already an important source of energy and trade to the Caribbean island, which repays part of its oil bill by providing the services of 40,000 professional workers. Last year trade between the two countries was at around $5.26bn (£3.23bn) last year.

The 83-year-old Fidel Castro met President Chavez on 12 Dec but has not been seen in public for three-and-a-half years. Castro said the agreements were "historic". The agreement will provide an economic lifeline to the communist-run island. Cuba has long received all its Venezuelan oil for free, in exchange for thousands of doctors who help treat the country's poor. Venezuela has the largest oil reserves outside the Middle East and nasty critics accuse President Chavez of using his oil wealth to buy political influence across the region.

Petrocaribe may be a regional energy alliance. But with Venezuela and Cuba at its heart, politics is never far behind. Cuba's 81-year-old revolutionary leader was still recuperating from a series of operations and was unable to join the Venezuelan President in person at the Petrocaribe summit, hosted by Cuba, which was held in this southern coastal city in Dec 2007. Instead it was acting president Raul Castro who arrived at the summit with Chavez, along with almost a dozen prime ministers and presidents from around the Caribbean and Central America. New leader Raul Castro was seen here as a pragmatic leader determined to turn this country's state-run economy around. Petrocaribe offers 17 of the region's poorer nations access to Venezuelan oil on preferential terms. Chavez attacked the United States and other rich consumer nations for squandering their unfair share of world resources. We have begun to create a new geopolitics of oil that is not at the service of the interests of imperialism and big capitalists," Chavez said addressing a politically diverse range of nations, some traditional allies of Washington, others more closely linked to Britain and the Commonwealth. What they all have in common are fragile economies struggling to cope with oil prices pushing towards a $100 a barrel. Now they are being offered a barter deal as well, with the chance to pay for some of the oil in products such as bananas and sugar. The inauguration of a major new refinery in Cienfuegos, built with Venezuelan money was a grand show. The refinery will provide much needed energy security to this communist island which has lived under a US trade embargo for decades.

Cuba has survived more than 40 years of US sanctions intended to topple the government of Fidel Castro. It also defied predictions that it would not survive the collapse of its one-time supporter, the Soviet Union. Since the fall of the US-backed dictatorship of Fulgencio Batista in 1959 Cuba has been a one-party state led by Castro and - since February 2008 - by his annointed successor, younger brother. During the US-Soviet Cold War, Fidel Castro, known for his brave “missile crisis” that shook the western world, was for decades able to rely on strong Soviet backing, including annual subsidies worth $4-5 billion, and succeed in building reputable health and education systems. But, at least partly because of the US trade sanctions, he failed to diversify the economy. The disappearance of Soviet aid following the collapse of the USSR forced the government to introduce tight rationing of energy, food and consumer goods.

Venezuela has some of the world's largest proven oil deposits as well as huge quantities of coal, iron ore, bauxite and gold. Its economic fortunes are tied to world oil prices. Venezuela's president, Hugo Chavez, is leading the country - which is enjoying a windfall from high oil prices - through a socialist revolution. Chavez who won his new term in office in February, identified the civil security situation as one of his priorities for the rest of his current term in office. He also promised to "strengthen" the social programs known as misiones, which provide free healthcare and education in some of the country's poorest areas. Many economists say though that the next few years will be key as to whether he can sustain his level of social spending. Inflation in Venezuela is already the highest in Latin America at just under 30% a year. He has secured the right to stand again for office in the next elections due in 2012, and elections beyond.

After almost 50 years of resistance and victories, Cuba and Venezuela are “comrades” in arms even after the falloff the Soviet system. Now Cuba has found a new benefactor in Venezuela and bilateral ties are getting stronger year after year. For much of the revolution, though, Cuba had to rely on the support of the Soviet Union. It bravely survived the collapse of communism there. Cuba suffered regular blackouts, food shortages and factory closures. 

  -----------------------

Dr. Abdul Ruff Colachal

Specialist on State Terrorism

Independent Columnist in International Affairs, Research Scholar (JNU) & the only Indian to have gone through entire India, a fraud and terror nation in South Asia.