GOR GIVES, GETS LITTLE FROM ECUADORIAN PRESIDENT

C O N F I D E N T I A L SECTION 01 OF 02 MOSCOW 002719 SIPDIS E.O. 12958: DECL: 11/03/2019 TAGS: PREL PGOV RS EC SUBJECT: GOR GIVES, GETS LITTLE FROM ECUADORIAN PRESIDENT REF: A. MOSCOW 02330 ¶B. MANAGUA 789 MOSCOW 00002719 00... id: 232725 date: 11/3/2009 12:20 refid: 09MOSCOW2719 origin: Embassy Moscow classification: CONFIDENTIAL destination: 09MANAGUA789|09MOSCOW2330 header: VZCZCXRO0793 PP RUEHDBU DE RUEHMO #2719/01 3071220 ZNY CCCCC ZZH P 031220Z NOV 09 FM AMEMBASSY MOSCOW TO RUEHC/SECSTATE WASHDC PRIORITY 5284 INFO RUEHXD/MOSCOW POLITICAL COLLECTIVE PRIORITY RUEHCV/AMEMBASSY CARACAS PRIORITY 0304 RUEHMU/AMEMBASSY MANAGUA PRIORITY 0215 RUEHQT/AMEMBASSY QUITO PRIORITY 0001 RUEHSI/AMEMBASSY TBILISI PRIORITY 3919 -------------- header ends -------------- C O N F I D E N T I A L SECTION 01 OF 02 MOSCOW 002719 SIPDIS E.O. 12958: DECL: 11/03/2019 TAGS: PREL PGOV RS EC SUBJECT: GOR GIVES, GETS LITTLE FROM ECUADORIAN PRESIDENT REF: A. MOSCOW 02330 ¶B. MANAGUA 789 MOSCOW 00002719 001.2 OF 002 Classified By: Political Minister-Counselor Susan Elliott for reasons 1 .4 (b,d) ¶1. (C) Summary. During the October 27-29 visit to Moscow of Ecuadorian President Rafael Correa, several bilateral cooperation and trade agreements were signed, but the meetings did not conclude with the GOR granting any substantive arms deals, nor did President Correa recognize the breakaway republics of South Ossetia or Abkhazia. Ecuador purchased two helicopters, the two countries signed a joint Declaration of Strategic Partnership, and the GOR secured deals for Russian joint investment projects in energy, nuclear power, and telecom development in Ecuador. While President Correa left the door open to recognize the two republics, he may likely be still holding out for a better financial or military deal from the GOR which would outweigh the possible negative consequences of recognition. End summary. -------------- New Strategic Partners -------------- ¶2. (U) In the first-ever visit of a President of Ecuador to Moscow, President Rafael Correa Delgado along with the Ecuador Minister of Foreign Affairs Fander Falkoni and Minister of Defense Javier Ponce met on October 29 with President Dmitriy Medvedev. President Correa also met with Prime Minister Putin, Patriarch Kirill of the Russian Orthodox Church, Moscow Mayor Yuriy Luzhkov, and Russian business executives interested in investing in Ecuador. President Correa and a delegation of Ecuadorian lawmakers also met with Federation Council representative Sergey Mironov, who announced a sister city agreement between Vladivostok and Manta, Ecuador. After a more than 20-year hiatus, the Russian-Ecuadorian Intergovernmental Commission for Economic and Energy Issues convened on October 28, chaired by Russian Agriculture Minister Elena Skrynnik and Ecuadorian Minister of Economic Policy Diego Borja. Trade between the countries was nearly $1 billion in 2008, with Ecuador's main exports to Russia consisting of fruit and flowers, and Russia mainly exporting iron materials and fertilizer to Ecuador. ¶3. (U) After their meeting, President Medvedev and President Correa signed a Declaration on the Strategic Partnership, which contained several side agreements dealing with economic, humanitarian, and political issues. According to Interfax, the Russian Energy Ministry, the Ecuadorian Ministry of Electricity and Renewable Energy, and the Ecuadorian Minister of Mines and Petroleum signed a Memorandum of Mutual Understanding. The GOR and Ecuador also penned agreements on hydropower projects and the development of telecom technologies in Ecuador. Rosatom also announced an agreement on civil-nuclear cooperation, including possible joint project in construction of nuclear power facilities and uranium exploration in Ecuador. -------------- Investments Focused on Economy, not Military -------------- ¶4. (U) Upon his departure from Russia on October 30, President Correa announced that the GOR promised to invest over $2.5 billion in Ecuador by 2014, which he noted would be focused on transport, infrastructure, science and technology. GOR Finance Minister Alexey Kudrin confirmed to press sources that Ecuador had requested a loan from the GOR, but noted that negotiations concerning the loan amount and terms had not yet begun. The GOR has not yet acknowledged granting any loan to President Correa. ¶5. (U) As part of his visit, President Correa finalized the purchase of two MI-17 Hip multirole helicopters. President Medvedev noted that while this was a small military contract, it was "the beginning of (Russian-Ecuadorian) interaction in this area," with good prospects for future relations. Before the visit, independent business daily Vedomosti reported that Russia was interested in supplying six Su-30MK2 Flanker multirole fighters, several helicopters and air defense systems to Ecuador, but the GOR has only confirmed the sale of the two helicopters. The Russian Ambassador to Ecuador, Yan Burlyai, told Echo Moskviy on October 29 that these helicopters were replacements for older helicopters and that this pact should not be considered as fueling an arms race in the Latin American region. MOSCOW 00002719 002.2 OF 002 -------------- Ecuador to Consider Recognition of South Ossetia and Abkhazia -------------- ¶6. (U) Despite the flurry of media speculation that President Correa planned to recognize South Ossetia and Abkhazia during his trip, much like Venezuelan President Chavez did on his visit to Moscow September 10 (ref A), President Correa did not announce recognition. Instead, on the day after his meeting with President Medvedev and hours before he was to leave Moscow, President Correa said, "if both regions officially ask Ecuador to recognize them, we will seriously consider this request." ¶7. (U) South Ossetian "foreign minister" Murat Dzhioyev told RIA Novosti on October 30 that South Ossetia would "of course officially ask" Ecuador for recognition. Likewise, Abkhazian "foreign minister" Sergey Shamba announced on October 30 that Abkhazia would also shortly be sending Ecuador their official request for recognition. Even before President Correa's visit, leaders of the breakaway regions were hopeful that Ecuador would follow Nicaragua and Venezuela, with Dzhioyev telling Vedomosti that they had strong hopes for recognition by Ecuador and Bolivia, and deputy "foreign minister" of Abkhazia Maxim Gvindzhia claiming that "the other Alliance for the People of Our America (ALBA) countries will eventually recognize (the republics) too." (Note: Nicaragua, Venezuela and Ecuador are all members of ALBA. End note). Alexei Makarkin, vice-president of the Center for Political Technologies, told Interfax that recognizing the republics is a "purely anti-US gesture, and...Ecuador has no reason to exacerbate its relations with the U.S." by making such a recognition. -------------- Comment -------------- ¶8. (C) The only other countries to recognize the breakaway republics earned sizable military agreements and investment packages from Russia. Venezuela was given $4.4 billion by the GOR to establish a Russian-Venezuelan bank as well as continued arms-for-credit deals of tanks and air defense systems (ref A). Nicaragua, the first country after Russia to recognize, gained more attention from Moscow as well as a gift of 130 municipal buses (ref B). By comparison, dividends from President Correa's trip to Moscow were modest, and he is likely waiting for larger military or investment offers from the GOR in exchange for becoming the next country to recognize, a decision which likely would worsen Ecuador's relations with the U.S. End comment. Beyrle =======================CABLE ENDS============================