The Upcoming Russian – Venezuelan Naval Exercises.

The Upcoming Russian – Venezuelan Naval Exercises.
By Benjamin Miller*

Overview
Russia has dispatched part of its Northern Fleet to the Caribbean for the country’s first ever naval exercises with Venezuela. The exercises, scheduled to take place November 10th-14th, will include a number of Russian and Venezuelan warships. Namely, the nuclear-powered heavy missile cruiser, Peter the Great, as well as the Admiral Chabanenko (an Anti-Submarine Warship) will be directly involved in the exercises. Intentionally ambiguous statements issued by the Russian government allow only for speculation regarding their motives behind the scheduled incursion into the Southern Hemisphere. The departure time of the Russian naval group, however, is peculiarly close to recently voiced Russian grievances about U.S. ships deployed on aid and relief missions in the Black Sea. Indeed, Putin’s prompt warning regarding the U.S. presence, “Our response will be calm, not hysterical, but there will definitely be a response,”[1] supports the notion that there is a significant political message being conveyed to the United States government.
[1] NOVOSTI: Russian News and Information Agency

Political messaging aside, the purposeful nature of Russia’s relationship with Venezuela over the past six years indicates that these naval exercises represent the newest phase of their plan to develop a strategic alliance with the anti-U.S. government of Hugo Chavez. As indicated in last week’s article of the Americas Report, Russian weapons exports to Venezuela have increased substantially over the past 5 years. According to a Jane’s Defense Business Article, the impact of Russian exports on the region is significant:

“Latin America accounted for just 7.7 per cent of Russia's total foreign defense sales during 2006 (according to Moscow's Centre for Analysis of Strategies and Technologies), but Venezuela alone accounted for 16 per cent of all military exports in 2007. Defense and aerospace contracts valued at USD3 billion were signed by the two countries in June 2006 to coincide with a visit to Moscow by Chávez.”[1]

While sources indicate that these specific movements will be oriented towards rescue and communication operations, it is possible that artillery and counter-terrorist training operations could take place as well. Moreover, Venezuelan Defense Minister Gustavo Rangel has said that military cooperation with Russia would prepare Venezuela to face possible U.S. “threats,” citing the reactivation of the U.S. 4th Fleet for Latin America and the Caribbean.[2] This appears to be a logical conclusion given the vast capabilities of the Russian fleet on its way.

Jon Rosamund, editor of Jane's Navy International, makes a good point about the main ship of the Russian fleet heading this way, “On paper it's [Peter the Great] an immensely powerful ship…We are not really sure if this is a show of force or if it poses a viable operational capability at this stage.”
Frank Mora, a Latin America expert at the National Defense University in Washington, also notes that Venezuela has little to contribute to the upcoming exercises. "They have a couple of destroyers, a couple of old submarines, and frigates that can launch surface-to-air missiles -- not anything sophisticated or robust. This would not be a robust exercise. It would be more about indicating strategic cooperation.”[3]
[1] Jane’s, “Russia extends $1bn loan to Venezuela for defense purchases” by Guy Anderson. 9/30/08
[2] Defense News, “Russian Warships Depart for Venezuela Maneuvers”. 9/22/08
[3] CNN: “Russian Ships to Visit Venezuela; Naval Exercises Possible”. 9/9/08

Why is it that Venezuela’s current inability to pose a direct threat to the United States remains a core issue in the discussion pertaining to these naval exercises? For that matter, why has the notion of a Russian nuclear missile cruiser basking in the Caribbean remained unaddressed? Whether or not Venezuela currently has the world-class hardware capable of posing a direct threat to the United States is both irrelevant and distracting. The recent contracts for 5-Kilo-class attack submarines, the other advanced weapons purchases, the talks of shared nuclear energy and oil technology…these are the core issues which should be of concern. The prospect of Russia sponsoring the creation of a nuclear Venezuela in the near future has real-time policy implications and, as indicated in a recent article by The Associated Press, is clearly on the agenda of both governments.

“Russia is ready to support Venezuela in the development of nuclear energy with peaceful purposes and we already have a commission working on it," Chavez said. "We are interested in developing nuclear energy.” [1] If nothing else, November 10th-14th will serve as one more piece of incontrovertible evidence that there is a focused effort by both countries to try to make Venezuela the dominant military power in the region.

In addition to its stop in the Caribbean, it has been speculated that the Russian fleet could stop in Syria as part of a broader show of force in the Mediterranean. Undisclosed sources have indicated that Russian engineers are expanding the Syrian ports of Tartus and Latakia to serve a more significant strategic purpose, “The possibility of basing aircraft carriers and missile cruisers there is foreseen,” the source told Russian newspaper, Izvestia. It is worth mentioning that the ports in Syria hosted a Soviet naval supply base and served as allies to Moscow during the Cold War. The likelihood of an impromptu port call in Syria has increased considering the recent controversy over the cross-border raids by the U.S. military into Syrian territory.

It is important to point out that the flagrant Russian support for those who would seek to intimidate and harm the U.S. is in no way comparable to our relief efforts underway in the Caucuses. The policy goal of the United States is to promote democracy and freedom among the sovereign peoples of every region, not just those within the former Soviet Union. This is a far cry from Moscow’s policy of supporting non-transparent dictatorships, similar to their own, in its efforts to sabotage true democracy for the purposes of re-establishing its withered sphere of influence. Russia’s provocative responses raise a number of important questions: How deep is the United States willing to allow the Russians to cement themselves in Latin America? How many more naval exercises and weapons shipments will it take for Putin to tip the balance of power in Latin America in his favor? Are the Russians initiating a military buildup similar to the one seen with Cuba in 1962? These are questions which should be carefully analyzed. Hopefully, the United States is not so distracted elsewhere in the world that it ignores this situation and the threat it poses to hemispheric security.





Relevant Russian Naval Specs:
“Peter the Great”: Kirov Class (Type 1144.2) Nuclear-Powered Heavy Missile Cruiser.[2]
· 20 Granit anti-ship missiles (500kt nuclear warhead or 750kg HE warhead) [3]
· S-300F Air Defense Missile Complex (96 missiles in 12 vertical launchers),
· Osa-MA autonomous antiaircraft missile system
· Kashtan missile/gun air defense system
· Anti-sub counter measures (20 missiles and 40 rockets)
· 30mm and 130mm artillery batteries.
· Carries two KA-27 helicopters

“Admiral Chabanenko”: ASW ship (Anti-Submarine Warfare) [4]
· 2 x 4 Moscit (SS-N-22 anti-air missile)
· 8 x 8 Kinzhal VLS (SA-N-9)
· 2 SA Kortik (SA-N-11)
· Upgraded sonar and defense measures.
· Anti-sub, anti-aircraft, and anti-ship capabilities via various torpedo and missile platforms.
[1] The Associated Press, “Venezuela to build nuclear technology with Russia”. By Christopher Toothaker. 9/28/08
[2] Naval-Technology.com
[3] FAS
[4] Federation of American Scientists

*Benjamin Miller is an intern at the Center for Security Policy in Washington, D.C. He is a graduate of the University of California San Diego and has a BA in Political Science, with a focus on Latin American and Middle Eastern Affairs.

The Russian – Venezuelan Strategic Alliance.

The Russian – Venezuelan Strategic Alliance.

By Benjamin Miller* with Nancy Menges.*

As relations between the U.S. and Russia have continued to deteriorate, Moscow has increasingly looked for opportunities to get even with Washington. Exactly what prompted this shift in foreign relations can be traced directly to Putin’s concerns pertaining to NATO expansion and American aide relief to former Soviet republics such as Georgia. It is no secret that Russia has continued to sell advanced weapons systems and technology to countries like Libya, Syria, Iran, Pakistan, North Korea and China despite shared intelligence linking several of these governments to illicit trade and terror networks. Likewise, one need only follow the money trail to see that Russia has now set its sights on Latin America and particularly on Venezuela.
According to the National Budget Office, Venezuelan President Hugo Chavez has tripled his country’s defense budget since 2000 to a whopping$3.3 billion in 2008. Chavez's biggest purchases from Russia came in 2006 when, in that year alone, he signed deals for over $3 billion in weapons.[1] Between 2004 and 2005 Venezuela

doubled the value of the major conventional weapons it imported from$13million to $27million.

This number then sky-rocketed to $406 million over the next 12 months, causing Venezuela to surpass other nations such as Argentina, France, Syria, Iraq, Sudan, and Afghanistan in the index.[1] The large majority of the weapons it received came directly from Russia.

History has shown that oil-based power politics can be used as a valuable weapon. Both Putin and Chavez understand this better than anyone, for it is these very tactics that allow them to consolidate and maintain power at home while projecting power abroad.

Russia’s petro-giants, GAZPROM and LUKOIL, along with Venezuela’s PDVSA, recently agreed to form what will be the largest oil consortium in the world.[1] The deal includes the joint exploration of untapped Venezuelan oil fields in addition to shared crude-oil refining technology. The plan is for Russia to build two oil refineries in Venezuela.

This is very much in line with Mr. Chavez’s pronouncements that he wants to find markets for his oil other than having to depend principally on the U.S. as his main buyer. Since China is also in the process of building three refineries in China to process Venezuelan crude, Chavez’s goal of cutting off the United States might be possible in three to five years. As proven by the OPEC crisis of 1973, oil and other natural resources can, and will be used as weapons by those who would cripple the global economy in an attempt to put a squeeze on the United States. By equipping leaders like Venezuela’s Hugo Chavez with the military and economic means by which to dominate entire regions and their subsequent markets, Russia is positioning itself to cause massive hemorrhaging in our hemispheric security structure.

The Hardware
Scholars continue to draw similarities between recent Chavez-Putin brokered military deals and those struck by Castro and Gorbachev in October of 1962. While it may be argued that any strategic threat comparison of the two scenarios is an elastic one at best, the substance of such an argument is limited to the specific weapons capabilities of the respective hardware involved.

To date Russia has sold Venezuela[1]:
· Twenty-four Su-30MK fighter jets[2]
· Fifty or more military helicopters (Mi-17’s, Mi-35’s, Mi-26’s)[3]
· At least five Kilo-Class attack submarines[4]
· 100,000 AK-47’s as well as rights to a manufacturing facility[5]
[1] All figures were confirmed through the Library of Congress using the databases from
*The Military Balance 2008. Published by Routledge for the International Institute for Strategic Studies
*SIPRI Yearbook 2007, “Armaments, Disarmament, and International Security”. Oxford University Press 2007.

In addition to the pending delivery of Tor-M1 surface-to-air missile systems, the most recent meeting between the two countries coincided with Russian military exercises showcasing the deployment of the Tochka (Scarab-1) short range ballistic missile platform for President Chavez. If there are doubts about Russian ability or intent to sell this type of hardware, one need only look at their transaction records with nations like Iran and Syria. The delivery of 29 Tor-M1 systems to Iran was the most controversial export of 2006[1] and Syria has already purchased multiple Scarab-1 platforms[2]. This meeting yielded a $1billion Venezuelan line of credit with which to buy other Russian armaments. Additionally, Russia has promised Venezuela a large order of T-72 Main Battle Tanks and BMP-3 armored infantry combat vehicles. While these weapons platforms are incapable of deploying nuclear payloads against the continental U.S., they greatly enhance Venezuela’s ability to launch conventional attacks and ultimately to attain regional military dominance.

Chavez’s Plan
Chavez is a cunning and rational adversary. Both his long and short term agendas to uproot opposition to his control of the Venezuelan economy, military, and political system are clear in light of his ongoing efforts at military consolidation and constitutional reform. While he remains adamantly anti-American in his policies, the Venezuelan leader is well aware that a direct attack against the United States would be political and military suicide. Chavez understands that operating under the auspices of Russia provides him increased elasticity in dealing with the United States, and it would be unwise to place Venezuela in a situation where it could be left isolated and devoid of fruitful international allies such as Russia and China. It is logical then, to deduce that Chavez’s new arsenal is intended to augment his broader hegemonic strategy in the region as a tool of coercion.

That being said, U.S. military personnel operating out of regional drug-trafficking monitoring locations and more permanent forward operating locations (FOLs) are significantly more vulnerable as a result of these weapons. These tactical anchors play a vital role in U.S. counter-terrorism and narco-trafficking operations in the region, and are on the verge of collapse. It is definite that the U.S. base at Manta, Ecuador will not be renewed by the Correa government when our lease there expires in 2009. Of the other two U.S. FOLs in the region, it is likely that the one in Honduras will be removed because of their recent turn towards more Chavista like policies. The simple truth of the matter is that a growing Russian-Venezuelan strategic alliance, when combined with a potential decrease of United States regional influence, is directly affecting American hemispheric security interests. To our regional allies such as Colombia, who has been fighting against a forty year long FARC insurgency and is actively engaged in the fight for democracy, the Venezuelan-Russian threat is an imminent one.

*Benjamin Miller is an intern at the Center for Security Policy in Washington, D.C. He is a graduate of the University of California San Diego and has a BA in Political Science, with a focus on Latin American and Middle Eastern Affairs.

* Nancy Menges is co-founder of the Menges Hemispheric Security Project at the Center and Editor-in-Chief of the Americas Report.

[1] The Military Balance 2008, “Russia: Arms Trade”. Pp 210.
[2] Defense and Security (Russia)


[2] http://www.airforce-technology.com/projects/su_30mk/index.html
[3] Defense and Security (Russia), “Luring Chavez…” September 29th, 2008. Taken from LexisNexis.com
[4] http://www.nti.org/db/submarines/russia/export.html, “Russia Export Behavior”.
[5] NTI: “Russia Export Behavior”.
[1] Business News Americas

[1] SIPRI Yearbook 2007, “Armaments, Disarmament and International Security”. Oxford University Press 2007. Page 419 Table 10A.1

[1] Bloomberg.com, “Russia Offers Venezuela's Chavez Weapons, Nuclear Cooperation”. Allison & Meyer

China’s Control of the Panama Canal Revisited.

China’s Control of the Panama Canal Revisited.
By Yojiro Konno with Nancy Menges.

China’s increasing influence in the Western Hemisphere has been of growing interest to lawmakers on Capitol Hill. In fact, on June 11, 2008, the House Foreign Affairs Subcommittee on the Western Hemisphere held a hearing entitled “The New Challenge: China in the Western Hemisphere.”[i] In the hearing, experts on Latin America pointed out that total trade between China and the Latin American and Caribbean region skyrocketed from $8.2 billion to $102 billion in less than ten years. Furthermore, those testifying mentioned that Chinese President Hu Jintao’s visit to several Latin American countries in 2004 underscored China’s increased presence in the hemisphere. During his visit, Hu stated that China would invest $100 billion in the region over the next decade.

Over the past years, several Latin American countries that had no diplomatic ties with the People’s Republic of China have now established them. For instance, in 2007, Costa Rica aborted its ties with Taiwan and established diplomatic relations with the People’s Republic of China, primarily for economic and financial reasons.[i] However, the most important indicator of China’s growing influence is its control over the ports at both ends of the Panama Canal. China has been operating these ports since 2000 and their influence inside Panama has grown as indicated by a bill submitted last year to the legislature that mandates teaching Mandarin in all Panamanian public schools.[ii]

Currently the Panama Ports Company,[i] a subsidiary of Hutchison Whampoa Ltd.,[ii] has exclusive and extensive rights to control both ends of the Panama Canal. Hutchison Whampoa is a Chinese company owned by Hong Kong billionaire, Li Ka-Shing, who has strong ties with Beijing. Considering Li’s close ties with the Chinese government, it is highly plausible that Hutchison Whampoa has the potential to act as Beijing’s political agent and that their possession of the ports at either end of the Panama Canal constitutes a serious U.S. national security issue.
[i] Panama Ports Company Official Website (http://www.ppc.com.pa/index_eng.php)
[ii] Official website of Hutchison Whampoa clearly mentions that Panama Ports Company is a subsidiary of Hutchison Whampoa (http://www.hutchison-whampoa.com/eng/ports/international/the_americas.htm)

Over the past years, several Latin American countries that had no diplomatic ties with the People’s Republic of China have now established them. For instance, in 2007, Costa Rica aborted its ties with Taiwan and established diplomatic relations with the People’s Republic of China, primarily for economic and financial reasons.[i] However, the most important indicator of China’s growing influence is its control over the ports at both ends of the Panama Canal. China has been operating these ports since 2000 and their influence inside Panama has grown as indicated by a bill submitted last year to the legislature that mandates teaching Mandarin in all Panamanian public schools.[ii]

Currently the Panama Ports Company,[iii] a subsidiary of Hutchison Whampoa Ltd.,[iv] has exclusive and extensive rights to control both ends of the Panama Canal. Hutchison Whampoa is a Chinese company owned by Hong Kong billionaire, Li Ka-Shing, who has strong ties with Beijing. Considering Li’s close ties with the Chinese government, it is highly plausible that Hutchison Whampoa has the potential to act as Beijing’s political agent and that their possession of the ports at either end of the Panama Canal constitutes a serious U.S. national security issue.

Brief Overview of the History of Panama Canal
The Panama Canal was established in 1914 under the leadership of the United States. The Hay-Bunau Varilla Treaty in 1903 granted a right to the United States to build and administer the canal and the surrounding areas indefinitely. However, because this treaty was signed without the consent of the Panamanians, it became a contentious diplomatic issue between Panama and the United States. The Panamanian dissatisfaction toward U.S. control over the Canal Zone reached a peak in January of 1964, when riots over sovereignty of the Canal Zone broke out. Responding to such protests, in 1977 President Carter signed the Neutrality Treaty and the Panama Canal Treaty. Under the Neutrality Treaty, Panama became obliged to guarantee the neutrality of the Canal Zone. In exchange, under the Panama Canal Treaty, the US promised to withdraw from the Canal Zone by the end of 1999 and guaranteed that Panama would assume full sovereignty over the area in 2000.

Hutchison Whampoa’s Control over the Panama Canal and Panama Law No.5
However, in 1996, Panama decided to auction the rights to manage the canal to a private company. Despite the fact that the Chinese company’s bid came in fourth after the Japanese firm, Kawasaki/I.T.S., the U.S. firm, Bechtel, and the Panamanian American company, M.I.T,[i] Panama awarded the contract to China’s Hutchinson Whampoa. A published report claimed that “Panama preemptively closed the bidding, secretly changed the rules,” and “simply awarded the contract to Hutchison Whampoa.”[ii] According to Constantine Menges, who headed the Latin American desk at the NSC during the Reagan Administration, “China was determined to win the bidding process and used corrupt means to influence the government of Panama in its favor.”[iii] In fact, a 1996 cable to the U.S. Embassy in Panama reported that just before the bidding, Beijing gave $400 million to Hutchison Whampoa through a state-run investment company, China Resources Enterprise,[iv] a company which was identified by Senator Fred Thompson as “an agent of espionage—economic, military, and political—for China” and “has reportedly served as an intelligence-collection front for China.”[v] William J. Hughes, the U.S. ambassador to Panama, and Senator Trent Lott objected to the ‘unorthodox’ bidding process and called for an investigation, but in vain. (See “The Americas Report” April 10, 2008. Article by Nicole M. Ferrand.)

Thus in January of 1997, through a state-contract called “Panama Law No.5,”[vi] Panama officially granted the right to control the canal[vii] to Hutchison Whampoa. Panama Law No. 5 also promised that at the end of the Panama Canal Treaty, “the areas, facilities, and installations” occupied by the Panama Canal Commission and the United States shall be turned over to Hutchison Whampoa (Clause 2.23.g). In other words, Hutchison Whampoa controls not only the ports at both ends of the canal, but also the surrounding areas the United States used to control, including the former U.S. Rodman Naval Station (Clause 2.1) and the former U.S. Albrook Air Force Base.[viii] The length of the lease to Hutchinson Whampoa is 25 years with an automatic renewal for another 25 years (Clause 2.9).

According to Panama Law No.5, Panama gave extensive and exclusive rights to Hutchison Whampoa. The document says, “During the life of this contract and its extension, THE COMPANY shall have the exclusive right to develop, construct, operate, administer and manage THE Ports”[ix] (Emphasis added). Hutchison Whampoa’s rights include: a right to “fence in, at any time, and entirely at its discretion, the area referred to here in as the Bonded Area[x] (Clause 2.1)”; a right to “subcontract all of its rights and activities granted by this concession contract, without the need for approval by THE STATE”; and a right to “carry out operations, transactions, negotiations, and activities in general, be they local or international, with any person or public, private or mixed entity.” That is, taking such extensive rights into accounts, it seems possible for Hutchison Whampoa to host and hide Chinese spying activities in the Canal Zone.

Hutchison Whampoa and Owner Li Ka-Shing’s Connections with Beijing
The owner of Hutchison Whampoa, Li Ka-Shing, has extensive ties with Beijing. In fact, a government document explicitly mentioned that Li “has significant economic and political ties to China.”[xi] For instance, Li and a son of the former Chinese President Jiang Zemin are jointly developing real estate properties inside Tiananmen Square for the communist party.[xii] In addition, in 1994, the Clinton administration provided Li’s bio, along with the bios of the top communist leaders, to the CEO of Loral Aerospace prior to the Ron Brown trade trip to Beijing;[xiii] Li was the only civilian included in the bios.[xiv] Li has also helped the People’s Liberation Army (PLA) purchase satellites in the past and mediated several satellite deals between the U.S. Hughes Corporation and China Hong Kong Satellite (ChinaSat),[xv]a company owned by the Chinese Ministry of Post and Telecommunications.[xvi] One U.S. government document stated that Li Ka-Shing “is willing to use his business influence to further the aims of the Chinese government.”[xvii]

A report by the RAND Corporation in 1997 pointed out that Li Ka-Shing was negotiating for PLA wireless system contracts.[xviii] Li was also a member of the board of directors of the China International Trust and Investment Corporation (CITIC), [xix] a bank of the Chinese army that provides money for Chinese weapon sales and Western technology purchases.[xx] Indeed, William Triplett, co-author of Red Dragon Rising, described Li as “the Banker for the Chinese Military.”[xxi] The fact that Hutchison has exclusive contracts with the state-owned China Ocean Shipping Company (COSCO) also suggests that Li Ka-Shing has a close relationship with Beijing.[xxii] COSCO is known for its failed attempts to acquire the former Long Beach Naval station in California.[xxiii] Furthermore, according to a RAND report, a COSCO ship attempted to smuggle over 2,000 fully automatic machine guns into the United States in 1996.[xxiv]

In 1991, Li Ka-Shing also attempted to gain control over Subic Bay, a strategic port in the Philippines that had been vacated by the United States. Due to warnings from U.S. Marine Corps personnel, Philippine President Ramos vetoed Hutchinson's take over of Subic Bay and Li Ka-Shing was unable to obtain the port.[xxv]

In 2003, Li attempted to take over the largest U.S. telecommunications company, Global Crossing Ltd. According to the New York Times,[xxvi] Global Crossing once agreed to make a deal with Hutchison Whampoa. However, Hutchison Whampoa decided to withdraw from the bid a few days after a review committee of foreign investment in U.S. companies announced that it had begun an investigation of the deal. Because a Chinese company with strong connections with Beijing was about to buy communication networks used by the federal government and other critical private sectors, members of congress and some governmental officials had raised national security concerns. Global Crossing provides services to the federal government, more than 35 percent of Fortune 500 companies, 700 carriers, mobile companies, and internet service providers.[xxvii] Global Crossing controls 20 percent of all the fiber-optic cable in the United States and is a major bidder for U.S. Defense communications contracts.[xxviii] Given Li Ka-Shing’s close ties with Beijing, as well as his attempts to control important U.S. infrastructure and a strategically important port in the Philippines it should make those responsible for U.S. national security question the national security implications of Hutchison Whampoa’s control over the Panama Canal.

In addition, Beijing seems to treat Li Ka-Shing in a special manner. For example, Beijing has given Li exclusive rights of first refusal over all mainland Chinese ports south of the Yangtze River. “This involves a close working relationship with the Chinese military and businesses controlled by the People’s Liberation Army,” said Al Santoli, a former national security advisor to the House of Representatives.[xxix] Further, Li’s bio provided by the Clinton Administration mentioned that Li was convicted of insider trading in 1984 but never punished.[xxx]

National Security Implications of Chinese Control of the Panama Canal
Now that Hutchison Whampoa controls both ends of the Panama Canal there are three major national security concerns that come to mind. These include; possible covert Chinese spying activities, strategic denial in the case of a serious conflict between China and the U.S., and strengthened Chinese political power that could threaten U.S. national interests. First, since Hutchison Whampoa has exclusive rights over the canal areas as Panama Law No.5 guarantees, the Chinese company could easily provide cover for Chinese espionage. This concern becomes more realistic when one considers China’s recent spying activities[i] and Li’s special relationships with Beijing and the PLA.

Secondly, in the event of a serious military conflict with the United States, such as one over Taiwan, it would be highly possible for Beijing to use Hutchison Whampoa to effectively interrupt U.S. intervention. As former Secretary of Defense Casper Weinberger puts it, Hutchison Whampoa’s control of the canal is a national security threat because “The Company would not be able to survive if they don’t do something the Chinese government tells them to.”[ii] Admiral Moore, a former chairman of the Joint Chiefs of Staff, claims that in case of military conflict in the Pacific, a large number of logistic ships need uninterrupted access to the canal to support deployed forces.[iii] If the use of the canal were denied, those ships would need to travel an extra 9,000 miles around South America and would not be able to sustain combat effectiveness in the Pacific.[iv] “It is not ‘managing traffic’ under normal circumstances with which I am concerned,” said Moore, “it is the ability of a potential enemy to disrupt traffic so as to block military supply, which in times of conflict is 80 to 90 percent dependent upon sea lift capability for there to be any sustained forward effort.”[v] It is also important to remember that Chinese denial of the use of the canal would significantly damage the U.S. economy; the United States is the largest user of the canal and 15-20 percent of total U.S. trade, including 40 percent of grain exports and 670,000 barrels of oil per day, come through the canal. [vi]

Chinese Control of the Panama Canal as Part of a Larger Global Strategy
Third and most importantly, Chinese control of the canal is only part of a larger Beijing strategy to strengthen its geo-strategic positioning around the globe. The Center for Security Policy reported in 2002 that China is working hard to acquire strategic “choke points” around the world, including the Caribbean’s Bahamas, Subic Bay in the Philippines, the Mediterranean’s Malt, the Persian Gulf’s Straits of Hormuz, the Panama Canal[vii], and even cyberspace,[viii] outer space, and U.S. telecommunications.[ix] In addition, on April 20, 2008, “The Americas Report” stated that Hong Kong-based Hutchinson Port Holdings (HPH) had expressed interest in the Manta Port in Ecuador. In October, 2006 HPH gave a 1 million dollar bond to the Manta Port Authority and in November, 2006, HPH was the only final bidder and the Manta Port Authority (MPA) gave HPH operating concessions in exchange for $486 million (added to $55 million promised by the MPA) to upgrade facilities over the next 30 years. Hutchinson Port Holdings is the port-operating subsidiary of Hong Kong’s Hutchison-Whampoa which in 2001 bought out Philippines-based port operator ICTSI, which had various Latin American interests in Argentina, Mexico and the Bahamas. Manta is a desirable port for HPH as it is the closest port to Asia on Latin America’s west coast. Also, Hutchison Whampoa Ltd. has a significant presence at the Lazaro Cardenas seaport in Mexico, as well as other Mexican ports. China has been very effective in securing strategic locations which they clearly understand will give them the upper hand in the event of any future confrontation with the U.S.

Therefore, strengthened Chinese strategic positioning has U.S. national security implications, as conflicts with China are foreseeable. The Congressional Research Service has reported that China has three main long-term goals which include “asserting China’s regional military leadership while displacing U.S. regional military influence, prevailing in regional rivalries, and encouraging eventual U.S. military withdrawal from the region [Western Pacific].”[x] These goals are clearly incompatible with U.S. national security interests.[xi] The Taiwan situation and competition over natural resources could also lead to conflicts in the future.

To conclude our loss of the Panama Canal was a major strategic blunder by the Carter Administration that was followed up in 1997 by the Clinton Administration’s failure to assure that the bidding process was open and fair. Since China, through Hutchison Whampoa, now has almost total sovereignty over the Canal, the Neutrality Treaty agreed to by President Carter has little significance in terms of protecting future U.S. interests. In the event of a future conflict between China and the U.S., it will be China not Panama that will be calling the shots. (Please find footnotes at the end of the Report).

* Yojiro Konno is a senior sociology major at Grinnell College, IA. He is interested in public policy and is currently an intern at the Center for Security Policy.

*Nancy Menges is co-founder of the Menges Hemispheric Security Project at the Center and Editor-in-Chief of the Americas Report.

[i] Demetri Sevastopulo. Feb. 11, 2008. “Four arrested in US-China spy cases.” Financial Times. (http://www.ft.com/cms/s/0/c0a576d0-d8cd-11dc-8b22-0000779fd2ac.html)
[ii] Menges, Constantine C. 2005. China: the gathering threat. Nelson Current. Page 397
[iii] Ed Oliver and Joseph Farah. November 9, 1998. “The Panama Canal debate rages: Admiral, ambassador square off in Senate testimony.” WorldNetDaily. (http://www.worldnetdaily.com/news/article.asp?ARTICLE_ID=16790)
[iv] Ed Oliver. October 18, 1998. “Admiral: I see big trouble in Panama.” WorldNetDaily. (http://www.worldnetdaily.com/news/article.asp?ARTICLE_ID=16751)
[v] Ed Oliver and Joseph Farah. November 9, 1998. “The Panama Canal debate rages: Admiral, ambassador square off in Senate testimony.” WorldNetDaily. (http://www.worldnetdaily.com/news/article.asp?ARTICLE_ID=16790)
[vi] Menges, Constantine C. 2005. China: the gathering threat. Nelson Current. Page 396
[vii]The Center for Security Policy, cited in Slate Magazine Online. July 9, 2008. (http://fray.slate.com/discuss/forums/post/1357239.aspx)
[viii] “China’s Cyber-Militia” May 31, 2008. National Journal (http://www.nationaljournal.com/njmagazine/print_friendly.php?ID=cs_20080531_6948)
[ix] Glater, Jonathon D. May 1, 2003. “TECHNOLOGY; Hong Kong Partner Quits Joint Bid for Global Crossing.” New York Times.
[x] Ronald O’Rourke Page 44. “CRS Report for Congress: China Naval Modernization: Implications for U.S. Navy Capabilities—Background and Issues for Congress.” Congressional Research Service.
[xi] Dr. Richard Weixing Hu, a visiting scholar at the Brookings Institution, too, mentions that China wants the U.S. withdraw from East Asia at the event “Perceptions of U.S. Foreign Policy in East Asia” on June 3, 2008 (http://www.brookings.edu/events/2008/0603_cnaps.aspx)

[i] EagleForum.org. 1999. “Red China: Gatekeeper of the Panama Canal.” (http://www.eagleforum.org/psr/1999/nov99/psrnov99.html)
[ii] Menges, Constantine C. 2005. China: the gathering threat. Nelson Current. Page 397.
[iii] Menges, Constantine C. 2005. China: the gathering threat. Nelson Current. Page 397.
[iv] Smith, Charles R. February 12, 2002. “Chinese Billionaire Wants Global Crossing.” NewsMax. (http://archive.newsmax.com/archives/articles/2002/2/11/184102.shtml)
[v]Smith, Charles R. August 6, 2002. “Li Ka-Shing Seeks U.S. Contract.” NewsMax. (http://archive.newsmax.com/archives/articles/2002/8/5/181935.shtml)
[vi] Actual Texts from American Defense Center (http://www.americandefensecenter.org/documents.aspx) and ConservativeUSA (http://www.conservativeusa.org/panamalaw5.htm)
[vii] The document calls the two ports (Balboa and Cristobal) and surrounding areas combined as “The Existing Ports”
[viii] Menges, Constantine C. 2005. China: the gathering threat. Nelson Current. Page 397.
[ix] “The Ports” in the document includes lands, facilities, and installations of “The Existing Ports” as well as “The Future Extension.”
[x] “The Bonded Area”: combined areas of “The Existing Ports” and “The Future Extension”
[xi] SoftWar. June 24, 2008. “Li Ka-Shing.” (http://www.softwar.net/kashing.html)
[xii] Smith, Charles R. August 6. 2002. “Li Ka-Shing Seeks U.S. Contract.” NewsMax (http://archive.newsmax.com/archives/articles/2002/8/5/181935.shtml)
[xiii] SoftWar. June 24, 2008. “Li Ka-Shing.” (http://www.softwar.net/kashing.html)
[xiv] Smith, Charles R. August 6. 2002. “Li Ka-Shing Seeks U.S. Contract.” NewsMax.
[xv] Smith, Charles R. August 6. 2002. “Li Ka-Shing Seeks U.S. Contract.” NewsMax
[xvi] Federation of American Scientists. June 20, 1998. “Zhongxing / Chinasat.” (http://www.fas.org/spp/guide/china/comm/chinasat.htm)
[xvii] Menges, Constantine C. 2005. China: the gathering threat. Nelson Current. Page 397.
[xviii]SoftWar. July 9, 2008. “Rand Corporation Report Chinese Military Commerce and U.S. National Security.” (http://www.softwar.net/rand.html)
Smith, Charles R. February 12, 2002. “Chinese Billionaire Wants Global Crossing.” Newsmax. (http://archive.newsmax.com/archives/articles/2002/2/11/184102.shtml)
[xix] SoftWar. June 24, 2008. (http://www.softwar.net/kashing.html)
[xx] Smith, Charles R. February 27, 2003. “Global Double Crossing.” NewsMax. (http://archive.newsmax.com/archives/articles/2003/2/26/182009.shtml)
[xxi] Smith, Charles. December 8, 1999. “‘Dirty’ War in Panama.” (http://ads.wnd.com/news/printer-friendly.asp?ARTICLE_ID=17277)
[xxii] Smith, Charles R. March 6, 2003. “Billionaire Fails in Bid for Global Crossing.” NewMax. (http://archive.newsmax.com/archives/articles/2003/3/5/162452.shtml)
[xxiii] Smith, Charles R. March 6, 2003. “Billionaire Fails in Bid for Global Crossing” NewsMax. (http://archive.newsmax.com/archives/articles/2003/3/5/162452.shtml)
[xxiv] SoftWar. July 9, 2008. “Rand Corporation Report Chinese Military Commerce and U.S. National Security.” (http://www.softwar.net/rand.html)
Smith, Charles. May 25, 1999. “Chinagate's smoking gun.” WorldNetDaily. (http://pqasb.pqarchiver.com/latimes/access/29879182.html?dids=29879182:29879182&FMT=ABS&FMTS=ABS:FT&date=Jun+02%2C+1998&author=PAUL+RICHTER&pub=Los+Angeles+Times&desc=Long+Beach+Deal+Put+in+Jeopardy+by+China+Fears&pqatl=google)
[xxv] Smith, Charles. May 25, 1998. “The Panama-China connection: Port company at canal has close ties to Lippo group” The World Net Daily. (http://www.worldnetdaily.com/index.php?pageId=3251)
[xxvi] Glater, Jonathon D. May 1, 2003. “TECHNOLOGY; Hong Kong Partner Quits Joint Bid for Global Crossing.” New York Times. (http://query.nytimes.com/gst/fullpage.html?res=9B05E2DD1F3DF932A35756C0A9659C8B63 )
[xxvii] Global Crossing Official Website. July 8, 2008. “About us” (http://www.globalcrossing.com/company/company_landing.aspx)
[xxviii] Smith, Charles R. February 12, 2002. “Chinese Billionaire Wants Global Crossing.” NewsMax. (http://archive.newsmax.com/archives/articles/2002/2/11/184102.shtml)
[xxix] Menges, Constantine C. 2005. China: the gathering threat. Nelson Current. Page 397
[xxx] SoftWar. “Li Ka-Shing.” (http://www.softwar.net/kashing.html)

[i] Edward Cody. July 9, 2007. “China's Diplomatic Gain Is Taiwan's Loss” Washington Post (http://www.washingtonpost.com/wp-dyn/content/article/2007/07/08/AR2007070801065_pf.html)
[ii] BBC News. December 7, 2007. “Panama schools to teach Chinese.” BBC. (http://news.bbc.co.uk/mobile/bbc_news/world/americas/713/71312/story7131205.shtml?page_id=16)
[iii] Panama Ports Company Official Website (http://www.ppc.com.pa/index_eng.php)
[iv] Official website of Hutchison Whampoa clearly mentions that Panama Ports Company is a subsidiary of Hutchison Whampoa (http://www.hutchison-whampoa.com/eng/ports/international/the_americas.htm)

[i] Edward Cody. July 9, 2007. “China's Diplomatic Gain Is Taiwan's Loss” Washington Post (http://www.washingtonpost.com/wp-dyn/content/article/2007/07/08/AR2007070801065_pf.html)
[ii] BBC News. December 7, 2007. “Panama schools to teach Chinese.” BBC. (http://news.bbc.co.uk/mobile/bbc_news/world/americas/713/71312/story7131205.shtml?page_id=16)

[i] House Committee of Foreign Affairs. June 11, 2008. “New Challenge: China in the Western Hemisphere.” (http://www.internationalrelations.house.gov/hearing_notice.asp?id=1004)

Venezuela’s Tarek El - Aissami

Venezuela’s Tarek El - Aissami
By Nicole M. Ferrand*

Since our inception two years ago, we have been following the growing relationship between Venezuela’s Hugo Chavez and Iran’s Mahmoud Ahmadinejad. Although most of the information available in the media states that this relationship started in 2005, it actually began as soon as Chavez started his mandate in 1999. In fact, on November 19, 2007, the Iranian reformist newspaper, E’temad-e-Melli, published an article claiming that relations between Tehran and Caracas began with the formation of the (Iranian) Reformist government when former President Muhammed Khatami visited Venezuela during his time in office. They became so close that in 2005 Chavez presented the Iranian leader with the highest decoration, the Order of the Liberator, as a symbol of their strong ties.[1]

The Venezuelan President then encouraged Bolivia’s Evo Morales, Ecuador’s Rafael Correa and Nicaragua’s Daniel Ortega to develop ties with Iranian President Ahmadinejad which they did. All four of these countries now have strong ties to Iran and have signed treaties in diverse areas of the economy. In exchange, Iran has received many benefits including a strong presence in the Hemisphere as well as support from Venezuela, Nicaragua, Bolivia and Ecuador against UN sanctions. Although insiders claim that Iran had no interest in developing relationships with Caracas, per se, Khatami’s regime was under international pressure to make new alliances among non-aligned countries. In the Middle East, Tehran had strong ties with Syria and Qatar, but it did not have any base from where they could actually threaten the United States and that is when Caracas became of interest.[2] After learning of Chavez’s leadership in the Hemisphere, Tehran planned a strategy to establish itself in nations under the Venezuelan leader’s influence.

Manuchehr Honarmand was a witness to the developing Iranian-Venezuelan relationship. Mr. Honarmand is a Dutch citizen who used to write columns for the opposition daily Kayhan International, based in London. An Iranian dissident journalist, Honarmand decided to go to the US to expand the newspaper’s distribution. In December 2002 he visited South America for tourism and while in transit at the Caracas airport, waiting for a connecting flight, he was approached by two Iranians who asked him to provide information about himself. They were soon joined by two Venezuelan policemen.[3]

After learning who he was, they handcuffed him and brought him to an office behind the transit area where he was beaten and forced to sign papers in Spanish, which he did not understand. A few hours later, Honarmand was thrown into a cell where he was told that he had been charged with drug trafficking.

Furthermore, he was refused contact with the Dutch Embassy. A Venezuelan National Guard report stated that his “drug - filled suitcase” was found in a Copa Airlines flight even though Honarmand had been traveling on KLM.[4]

Mr. Honarmand’s luggage, money and papers were stolen and his Dutch passport was confiscated by the Venezuelan police. While he was in jail, he was able to contact Houshang Vaziri, his editor in chief, who promised to help but soon disappeared and was later found dead in Paris. Honarmand was freed in 2005, thanks to the Dutch government’s pressures. During his time in Caracas he spoke with discontented insiders of Chavez’s regime who informed him about the presence of Iranian officials in every sector of the economy and that they occupied high positions in the National Guard and the police. They also told Honarmand that Iranian officials are actually proselytizing in the poorest sectors of Venezuelan society to attract followers.[5] However, what has many insiders worried is the possibility of radicals holding government positions. The recent designation of Tarek El – Aissami as Minster of Interior and Justice of Venezuela has raised concerns because of his connections with extremist groups.

Mr. El – Aissami is a Venezuelan national of Syrian descent who, before becoming Minster of Interior and Justice, occupied the position of Deputy Interior Minister for Public Security. His father, Carlos Aissami, is the head of the Venezuelan branch of the Iraqi Baath political party. Before the invasion of Iraq, he held a press conference in which he described himself as a Taliban and called Osama Bin Laden, “the great Mujahedeen, Sheik Osama bin Laden.” Tarek’s great-uncle Shibli el-Aissami was a prominent ideologist and assistant to the party’s secretary general in Baghdad during the Saddam Hussein regime.[1]

It was discovered that in 2003 El Aissami was appointed, along with another radical student leader from the University of the Andes in the city of Mérida, Hugo Cabezas, to head the country’s passport and naturalization service, the Onidex (Identification and Immigration Office). The choice came as a surprise precisely because of their ties with guerrilla movements at Universidad de Los Andes (ULA). Evidence has surfaced that during this time both men illegally issued Venezuelan passports and identity documents to members of Hezbollah and Hamas. Mr. Cabezas is now the government candidate for governor of the Andean state of Trujillo in elections due to be held on November 23, 2008 and is a founding member of Utopia, an armed group that has connections with the Bolivarian Liberation Front.[2]

While a student leader at ULA, Aissami had political control of the university residences (dorms), which were used to hide stolen vehicles and conduct drug deals and had managed to get members of the guerillas into the dorms. According to reports, of the 1,122 people living in one of the University’s residences, only 387 were active students and more than 600 had nothing to do with the university.[3]

Venezuelan investigative journalist, Patricia Poleo, who escaped Venezuela and currently lives in Miami says that Mr. Aissami together with others affiliated with Hezbollah, such as Lebanon-born Gahzi Nasserddine, currently the Business Liaison at the Venezuelan embassy in Damascus, and his brother, Ghasan Atef Salameh Nasserddi, are in charge of recruiting young Venezuelan Arabs affiliated with the ‘Partido Socialista Unido de Venezuela’ or PSUV (Chavez’s Socialist Party), to be sent to South Lebanon for combat training in Hezbollah camps preparing them for ‘asymmetrical war’ against the United States. Once back in Venezuela, they are greeted by radical members of the Venezuelan Socialist Party affiliated with UNEFA (the university run by the Armed Forces) and the Universidad Bolivariana de Venezuela (Venezuelan Bolivarian University) and continue with their training in firearms, explosives and munitions. The training camps are located in the states of Monagas, Miranda, el Páramo, Falcon, Yaracuy, Yumare, and Trujillo and the districts of Maturin, Los Teques, El Jari, Churuguara and Sierra de San Luis. These groups and individuals are supervised by the Hezbollah Organization in Venezuela, along with al-Qaeda Iraqis currently living in the country and by the Palestinian Democratic Front, headed by Salid Ahmed Rahman, whose office is located in Caracas’s Central Park.[4]

Since Chavez assumed the Presidency, Hezbollah, Hamas and al-Qaeda have used Venezuela as their bridge to other Latin American countries. There is information that a group of Iraqi activists belonging to al-Qaeda are currently in Caracas. Their names are: Mohammed Adnan Yasin, Falah Amin Taha and Muhi Alwan Mohammed Al Qaisi. They all arrived in Caracas with temporary visas granted and approved by the heads of Onidex (Cabezas and Aissami) and are believed to be very dangerous. They oversee the activities of these terrorist organizations in the tri – border region, and in Nicaragua and Argentina.[5]

Other Hezbollah members in Venezuela with these same visas are: explosives expert Lebanese Abdul Ghani Suleiman Wanked, Hassan Nasrallah’s right-hand man.; Rada Ramel Assad, born in Barranquilla, Colombia and Abouchanab Daichoum Dani who is the organizer of the group.[6]
We have to be very careful about what is going on in Venezuela. Independent media outlets have warned that the Chávez regime was issuing ID documents to Islamic radicals, enabling them to operate and move freely to other countries. It is extremely worrisome and dangerous to appoint a radical such as Aissami as the official in charge of issuing identity cards and passports but this serves the goals of the Iranian and Venezuelan presidents in their joint efforts to radicalize the region and build terrorist networks.

Other articles written by the staff of The America’s Report that can be referenced to in relation with this story are: “The Iranian threat already in the US’ backyard”, February 14, 2008 by Nicole M. Ferrand; “Latin America’s radical grassroots”, by Luis Fleischman and Nicole M. Ferrand from March 27, 2007; “The Radical Grassroots in Latin America II”, by Luis Fleischman and Nicole M. Ferrand from April 11, 2007; “The Latin American Radical Grassroots III”, by Luis Fleischman and Nicole M. Ferrand).

*Nicole M. Ferrand is the editor of “The Americas Report” of the Menges Hemispheric Security Project. She is a graduate of Columbia University in Economics and Political Science with a background in Law from Peruvian University, UNIFE and in Corporate Finance from Georgetown University.

[1] Al Arabiya – Ibid.
[2] Jihad in Venezuela. November 29, 2003. Jihad Watch.
[3] Memri – Ibid.
[4] Hezbollah and Al Qaeda in Venezuela. June 12, 2008 The Jungle Hut.
[5] Ibid.
[6] Ibid,

[1] Ibid.

[2] Ibid.
[3] The Iran-Venezuela Connection. February 14, 2008. Memri.
[4] Ibid.

[1] Unholy alliance between Caracas and Tehran. January 13, 2008. Al Arabiya News.

China’s Cuban/Venezuelan Connection.

China’s Cuban/Venezuelan Connection.
By Yojiro Konno.*

Since the People’s Republic of China took over control of the Panama Canal in 2000, China has been rapidly increasing its activities in Latin America. In terms of economic activities, trade between China and Latin America increased 10 times in less than 10 years. President Hu Jintao’s visits to several Latin American countries in 2004 and his promise to invest $100 billion in the region also illustrate China’s increased presence in Latin America.

Although China is establishing closer ties with numerous countries in Latin America, its close relations with Cuba and Venezuela deserve special attention. Some analysts assume that China’s ties with Cuba and Venezuela are primarily economic and are compatible with U.S. interests. Considering, however, China’s alleged weapons sales to Cuba and Venezuela, Chinese electronic spying facilities in Cuba, and Chinese opposition to U.S.-led efforts regarding these two anti-American regimes, it is reasonable to conclude that such Chinese advancement does hurt U.S. security interests.

Brief Overview: China’s Connections with Cuba and Venezuela
After the collapse of the Soviet Union and the loss of economic, political, and military support from the Soviet Union, it was China who rescued Cuba from their severe economic crisis. China had provided interest-free loans to Cuba in the early 1990s, and in 2001 China signed an Economic and Technical Cooperation Agreement, under which China offered substantial support to Cuba, including an additional $6.5 million interest-free loan and a $200 million grant to modernize Cuba’s telecommunications. Furthermore, China and Cuba started 10 operative joint ventures with a particular focus on pharmaceuticals and biotechnology.[i]

In 2004, Chinese President Hu Jintao signed a trade agreement which called for $500- million-Chinese-investment in Cuban nickel plants and an annual 4,400 tons of Cuban nickel exports to China. China also agreed to provide a $6 million grant to Cuban hospitals, materials for school uniforms valued at $6 million, and one-million television sets. Trade between the two countries reached $2.2 billion in 2007, almost a 250 percent increase from 2005.[ii] In the last few years, China became Cuba’s second-largest trading partner, next to Venezuela.[iii] The frequent high-class military exchanges and the expansion of weapons systems provided by China to Cuba show the close military ties that now exist between the two countries.[iv]

In terms of Chinese-Venezuelan relations, Hugo Chavez’s visit to China in 1999 illustrated the strong ties between the two countries. During his trip, Chavez signed a number of oil and political agreements, including Venezuela’s purchase of Chinese military equipment and China’s dispatch of military trainers to Venezuela.[v] Indeed, after the failed attempt to overthrow Hugo Chavez in 2002, PLA military trainers replaced U.S. military trainers in Venezuela.[vi]

China’s Weapon Sales to Cuba and Venezuela
In June 2001, citing U.S. intelligence sources, the Washington Times reported that state-run China Ocean Shipping Company (COSCO) sent “at least three shipments of weapons” to Cuba during 2000.[vii] A Chinese spokesman, Zhang Yuanyuan, denied the allegations saying, “China has supplied the Cuban military with logistics items - never arms,” although he refused to specify what kinds of “logistics items” China provides.[viii] Being asked if explosives were included, the Chinese spokesman simply said that explosives could be used for both civilian and military purposes.[ix] Some claim that such military logistic items are used to modernize the base and other military equipment, including Russian war planes.

An intelligence source told the daily El Nuevo Herald, a Spanish newspaper published in Miami, that China limits its military assistance to logistical items, such as radars and aircraft equipment.[x] Additionally, because the U.S. State Department denied that the government had documents “confirming” China’s allegations, it seems that Chinese military sales to Cuba are in fact limited to “logistical items.” Jason Feer from CubaNews claims that China is unlikely to supply lethal weapons to Cuba because such an act triggers a 1996 U.S. law that requires U.S. economic sanctions against a country that provides significant arms to Cuba.[xi] However, now that China controls the Panama Canal, where most ships from the Pacific pass through in order to reach Cuba, such speculation causes one to wonder how the United States detects China’s weapon sales to Cuba without any U.S. presence at the Panama Canal.[xii]

China is getting closer to selling significant weapons to another anti-U.S. regime in Latin America—Venezuela. The United States used to be a principal military supporter of Venezuela until Hugo Chavez took over the government. However, now that Chavez is President of Venezuela, Venezuela recently purchased a modern communications satellite and three Chinese long-range defense radars in an attempt to reduce its dependency on the United States. The contract includes China’s right to have leased access to a satellite communications network. According to the Press Association, this satellite is to be launched on November 1, 2008.[xiii] Al Santoli, a former Senior Vice-President of the American Foreign Policy Council, testified to Congress that one intelligence source reported that China recently offered to sell FC-1 fighters to Venezuela.[xiv] Richard Fisher, a senior fellow at the Jamestown Foundation in Washington, even claims: “We can anticipate that Chavez will soon be buying Chinese weapons.”[xv] Indeed, a news article of the Press Association on August 18, 2008, reported that President Chavez said that Venezuela is looking to purchase Chinese-made military planes.[xvi]

China’s Electronic Espionage Facilities in Cuba and Intelligence Sharing
China operates several electronic and cyber-warfare bases in Cuba, which, according to Al Santoli, “not only permit enhanced electronic surveillance of broad areas of the U.S. at present,” but also “can be used to disrupt critical U.S. strategic communications during a period of conflict.”[xvii] China seems to operate at least three electronic and cyber spying facilities in Cuba: one in Santiago de Cuba, another in Bejucal, and the third in Lourdes.

A spying facility in Santiago de Cuba, located in the far east of Cuba, seems to be intercepting U.S. satellite signals, including military satellite communications, according to Cuban sources in 1999.[xviii][xix][xx] An espionage base in the Bejucal area is said to possess complex telephone interception systems.[xxi][xxii][xxiii] In Lourdes near Havana, China reportedly operates an electronic espionage facility after Russia abandoned its largest espionage facility outside the former Soviet Union in 2001.[xxiv] Al Santoli claims that these bases have been camouflaged under a pretext of China-Cuba collaboration regarding telecommunications.[xxv]

In 2005 China was accused of conducting espionage activities using front companies to steal sensitive military technologies from the United States, Britain, Germany, and Canada.[xxvi] Considering China’s past attempts some are rightly concerned that while China’s close military ties does not provide an immediate military threat to the United States, it enhances China’s asymmetrical military options because China was able to obtain “major listening posts and communications jamming stations in Cuba.”[xxvii]

Additionally, as Chavez has suggested that he may provide China and Cuba with some U.S. military jets so they can study the technology,[xxviii] it is possible for these three countries to cooperate in espionage against the United States and share intelligence with their anti-U.S. friends, such as Iran and other state sponsors of terrorism (See The Americas Report on July 24, 2008, article by David Witter).

China as a Guardian of State-Sponsor of Terror and Anti-U.S. Regime
China has been a powerful advocate of Cuba, a state sponsor of terror as designated by the U.S. State Department. Chinese President Jiang in 2001 claimed that China “supports the Cuban people’s fight to safeguard state sovereignty…and reject foreign intervention and threats…. Politically we support and understand each other.”[xxix] Indeed, China consistently opposes U.S. sanctions on Cuba at the United Nations.

For example, China’s UN representative criticized the United States for maintaining the embargo on Cuba in October 2004 and opposed U.S.-led efforts to condemn Cuba for its repression of civil and political freedom in April 2005. It is also important to remember that China has veto rights on the U.N. Security Council that could be used against any decision seeming to harm China’s friends, such as Venezuela, Cuba, Sudan, Iran, North Korea and others.

Castro and Chavez seem to know from prior experience that the United States will not take any strong actions against them if China is on their side. Now two anti-U.S. regimes in Latin America seemed to have gained a powerful ally that supports their undemocratic regimes.[xxx]

China Threat: Strategic Positioning around Latin America and the World
Not only has China obtained energy and natural resources from Cuba and Venezuela, but it has also succeeded in gaining anti-U.S. friends with strategic locations, creating a counterweight to the United States in Latin America. Considering Chinese control of the Panama Canal, other Chinese attempts to secure strategic locations around the world, Chinese rapid naval modernization beyond capabilities necessary at the Taiwan Strait, and its support to anti-U.S. regimes, policy makers in the government and on Capitol Hill should be able to connect the dots and realize what such moves by the Chinese really mean and how the United States should respond.

It seems clear that the Chinese government is interfering with U.S. efforts to contain openly hostile regimes in its hemisphere; a policy that should be considered in the overall U.S.-China relationship. Finally, Evan Ellis, a Latin American analyst at Booz Allen Hamilton, provides a great hint regarding what these Chinese moves may mean: “Chinese strategic thinking, from the writings of Sun Tzu to classic games such as ‘go’ emphasize the value of setting the stage, as much as the battle itself. The idea is to position oneself at an advantage in all possible realms –politically, militarily or physically—so that if a tangible confrontation must occur, the adversary simply cannot prevail.”[xxxi]

* Yojiro Konno is a senior sociology major at Grinnell College, IA. He is interested in public policy and is currently an intern at the Center for Security Policy.
[i] “Cuba and China: the new face of an old relationship.” AllBusiness. September 22, 2006. (http://www.allbusiness.com/public-administration/national-security-international/3975916-1.html)
[ii] “Cuba–China Ties in Focus as Standing Committee Member Visits Fidel.” Transpacifica. June 27, 2008.
(http://transpacifica.net/2008/06/27/cuba%E2%80%93china-ties-in-focus-as-standing-committee-member-visits-fidel/)
[iii] “Chinese presence, interests in Cuba growing.” The Miami Herald. June 24, 2007. (http://www.hemisferio.org/al-eeuu/boletines/02/75/pol_20.pdf)
[iv] “China and Cuba: Dangerous Liaison.” NewsMax. June 29, 2001. (http://archive.newsmax.com/archives/articles/2001/6/28/211846.shtml)
[v] Testimony of Albert Santoli. July 21, 2005. “China’s Strategic Reach into Latin America.” (http://www.uscc.gov/hearings/2005hearings/written_testimonies/05_07_21_22wrts/santoli_albert_wrts.htm)
[vi] Testimony of Albert Santoli. July 21, 2005. “China’s Strategic Reach into Latin America.” (http://www.uscc.gov/hearings/2005hearings/written_testimonies/05_07_21_22wrts/santoli_albert_wrts.htm)
[vii] “China and Cuba: Dangerous Liaison.” NewsMax. June 29, 2001. (http://archive.newsmax.com/archives/articles/2001/6/28/211846.shtml)
[viii] The Washington Times. 2001. “China claims sale of 'logistics items,' not arms.” (http://www.cubanet.org/CNews/y01/jun01/14e4.htm)
[ix] The Washington Times. 2001. “China claims sale of 'logistics items,' not arms.” (http://www.cubanet.org/CNews/y01/jun01/14e4.htm)
[x] Asia Times. 2001. “China/Cuba/US Taiwan tit-for-tat.” (http://www.atimes.com/china/CF22Ad04.html)
[xi] Asia Times. 2001. “China/Cuba/US Taiwan tit-for-tat.” (http://www.atimes.com/china/CF22Ad04.html)
[xii] The Washington Times. 2001. “China claims sale of 'logistics items,' not arms.” (http://www.cubanet.org/CNews/y01/jun01/14e4.htm)
[xiii] “Venezuela to Launch Satellite.” August 18, 2008. The Press Association. (http://ukpress.google.com/article/ALeqM5jOiDMTD1_8Can9ZlVOBVbLstAd6Q)
[xiv] Testimony of Albert Santoli. July 21, 2005. “China’s Strategic Reach into Latin America.” (http://www.uscc.gov/hearings/2005hearings/written_testimonies/05_07_21_22wrts/santoli_albert_wrts.htm)
[xv] Testimony of Albert Santoli. July 21, 2005. “China’s Strategic Reach into Latin America.” (http://www.uscc.gov/hearings/2005hearings/written_testimonies/05_07_21_22wrts/santoli_albert_wrts.htm)
[xvi] “Venezuela to Launch Satellite.” August 18, 2008. The Press Association. (http://ukpress.google.com/article/ALeqM5jOiDMTD1_8Can9ZlVOBVbLstAd6Q)
[xvii] “China’s ‘Peaceful’ Invasion: Latin America attractive as market for arms sales.” Washington Times. November 20, 2005. (http://www.washtimes.com/news/2005/nov/20/20051120-124045-3471r/?page=3)
[xviii] Stephen Johnson. October 2005. “Balancing China’s Influence in Latin America.” Heritage Foundation. (http://www.heritage.org/Research/LatinAmerica/upload/84474_1.pdf)
[xix] Testimony of Albert Santoli. July 21, 2005. “China’s Strategic Reach into Latin America.” (http://www.uscc.gov/hearings/2005hearings/written_testimonies/05_07_21_22wrts/santoli_albert_wrts.htm)
[xx] “Castro And Cuba Dance With China How Cuba-China Relations Will Affect The U.S.” 2002. NBC6. (http://www.nbc6.net/hanktester/1497131/detail.html)
[xxi] Stephen Johnson. October 2005. “Balancing China’s Influence in Latin America.” Heritage Foundation. (http://www.heritage.org/Research/LatinAmerica/upload/84474_1.pdf)
[xxii] Testimony of Albert Santoli. July 21, 2005. “China’s Strategic Reach into Latin America.” (http://www.uscc.gov/hearings/2005hearings/written_testimonies/05_07_21_22wrts/santoli_albert_wrts.htm)
[xxiii] “Cuba and China: the new face of an old relationship.” AllBusiness. September 22, 2006. (http://www.allbusiness.com/public-administration/national-security-international/3975916-1.html)
[xxiv] Stephen Johnson. October 2005. “Balancing China’s Influence in Latin America.” Heritage Foundation. (http://www.heritage.org/Research/LatinAmerica/upload/84474_1.pdf)
[xxv] Testimony of Albert Santoli. July 21, 2005. “China’s Strategic Reach into Latin America.” (http://www.uscc.gov/hearings/2005hearings/written_testimonies/05_07_21_22wrts/santoli_albert_wrts.htm)
[xxvi] Fred Stakelbeck. “Sino-Cuba energy relations raise concern in Washington” Aug, 2006. (http://www.monstersandcritics.com/news/energywatch/oilandgas/features/article_1190927.php/Sino-Cuba_energy_relations_raise_concern_in_Washington?page=2)
[xxvii] Testimony of Albert Santoli. July 21, 2005. “China’s Strategic Reach into Latin America.” (http://www.uscc.gov/hearings/2005hearings/written_testimonies/05_07_21_22wrts/santoli_albert_wrts.htm)
[xxviii] “China’s ‘Peaceful’ Invasion: Latin America attractive as market for arms sales.” Washington Times. November 20, 2005. (http://www.washtimes.com/news/2005/nov/20/20051120-124045-3471r/?page=3)
[xxix] Menges, Constantine C. 2005. China: the gathering threat. Nelson Current.
[xxx] “China and Cuba: Dangerous Liaison.” NewsMax. June 29, 2001. (http://archive.newsmax.com/archives/articles/2001/6/28/211846.shtml)
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