Russia back in Latin American arms market

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MOSCOW, July 29 (UPI) -- Russia's arms export agency Rosoboronexport will deliver eight helicopters to Peru, the first post-Soviet arms sale to the Latin American country.

Peru last week in Lima signed a contract for the delivery of six Mi-171Sh Hip transport and two Mi-35P Hind attack helicopters, Rosoboronexport said in a statement. Observers say the first post-Soviet arms deal to Peru since 1990 was sparked by a trip of Russian President Dmitry Medvedev to Lima in November 2008, where he lobbied for a revitalization of new defense cooperation.

While Russian media sources estimated the deal to be worth $250 million, a statement on Peru's Defense Ministry Web site said the contract is valued at $107.9 million. Defense Minister Rafael Rey said the two combat helicopters would be delivered this year, with the six transport helicopters following by July 2011.

Rey said the helicopters would be used in the counter-terrorism and anti-narcotics fight in the Valley of the Apurimac and Ene River, where drug production and trafficking has been increasing.

Rosoboronexport accounts for more than 80 percent of Russia's arms sales. The company last year exported weapons worth $7.4 billion and concluded contracts for a total of $15 billion.

Russia has been eager -- and in some instances successful -- to gain a foothold in the quickly growing Latin American defense market.

The biggest deals were clinched with Venezuela, a country that during the past five years has ordered from Russia weapons worth around $4.4 billion.

They include 24 Sukhoi Su-30MK2 fighter jets, 50 attack and transport helicopters from Russia's Mil Moscow Helicopter Plant, a dozen missile systems and 100,000 Kalashnikov assault rifles, Defensenews.com reported.

Rosoboronexport at the Farnborough Air Show outside London this month said that Venezuela may soon buy transport planes from Russia.

Washington is worried by the Venezuelan military expansion and potentially arising black markets in Latin America.

The Stockholm International Peace Research Institute would agree. In its study on the global arms market unveiled in March, it found that weapons sales to Latin America were 150 percent higher during the last five years compared with the beginning of the millennium.

This is due to a significant upswing in both military spending and an almost competitive behavior when ordering arms, SIPRI said.

"This clearly shows we need improved transparency and confidence-building measures to reduce tension in the region," said Mark Bromley, SIPRI's Latin America expert.