Putin takes 3-billion-dollar arms contracts to Libya

Russia’s outgoing President Vladimir Putin is making an official visit to Libya on April 16-17. Libya plans to purchase Russia’s military hardware in the sum of almost three billion dollars. Respective contracts have been prepared on the threshold of Putin’s visit to Libya. However, it is not ruled out that the contracts will not be signed due to the problem with the Libyan debt.

Putin is visiting Libya on the invitation from the leader of the Libyan revolution, Muamar Kaddafi. Russia’s Finance Minister, Aleksei Kudrin and the Director of Russia’s major defense export enterprise Rosoboronexport, Anatoly Isaikin, are traveling to Libya with Putin, the Vedomosti newspaper reports.

The contracts, which the Russian officials are taking to Libya include the export of 12 up-to-date Su-35 jet fighters (their test flights are only getting started in Russia) and anti-aircraft missile systems Tor-M2E.

Experts say that most of the documents will only be initialed because the issue of the Libyan debt to the USSR has not been regulated yet. Spokespeople for the Finance Ministry of Russia have not specified the amount of the debt by claiming that it would be inappropriate to reveal any numbers during negotiations.

According to the Appendix to the Law about the Federal Budget 2007, Libya owed about $3.5 billion as of January 1, 2006. Ministerial officials do not confirm the amount at the moment, though.

Official spokespeople for Russia’s Foreign Ministry said earlier that the question on the regulation of the Libyan debt to the former USSR was one of the key issues of the Russian-Libyan summit.

The regulation of the debt issue was complicated with the arrest of Deputy Finance Minister of the Russian Federation, Sergei Storchak at the end of 2007. Storchak was in charge of credit and international cooperation issues of the ministry. The official was charged with alleged embezzling of about $40 million.

Russia has a serious competitor of the Libyan arms market – France. Paris hopes to sell 18 Rafale fighters to Tripoli for more than 2.5 million euros. It is highly important for France to sell the fighters to Libya for it could become the country’s first export delivery after a series of failures.

In addition to weapons, Russia has other interests in Libya. In 2007 Russian natural gas giant Gazprom won a competition for the development of an extensive oil and gas field with 20 million tons of crude reserves. Lukoil, another Russian giant, also has its office in Libya too. However, its employee, Alexander Tsigankov, was arrested by Libyan police in November of 2007 on suspicion of espionage.

Libyan official suspected the Russian citizen of illegal purchase o information about oil and gas deposits of the nation shortly before last year’s tender for their development. Moscow officials believe that such accusations are groundless. Libya has not brought any charges against Alexander Tsigankov yet. Nevertheless, the incident overshadows bilateral relations between Russia and Libya.

Translateed by Dmitry Sudakov

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Author`s name Dmitry Sudakov