Saudi Offer To Russia Likely To Fail
Nov 08, 2002
stratfor.biz
The stakes are rising as the U.N. Security Council heads into a vote on a resolution concerning Iraq: Informed Russian sources tell Stratfor that Saudi Arabia has offered Moscow a multibillion-dollar, interest-free loan if Russia will veto a U.S.-backed draft Nov. 8 and continue to work to block U.S. military action in Iraq.
The 25-year loan could be used to repay all of Russia's external debt, and Riyadh also has offered to buy billions of dollars in military equipment from the country's defense industry, sources say.
The offer was first conveyed to Moscow during an Oct. 14-15 visit from a Saudi delegation, led by Finance Minister Abdul Aziz al-Assaf, for economic talks. Saudi Prince Abdullah al-Turki, a former minister for Islamic affairs who is known for connections with the Saudi special services, has been the main organizer of back-channel talks.
The incentive offered for the U.N. Security Council veto is huge indeed for Russia, a crisis-stricken country which continues on its decade-long downward slide. The loan could do much to revive the Russian economy, and Saudi money would pay for the design and production of high-tech weapons that both Saudi Arabia and Russia could use.
The offer very well could be enough to win Russia's veto were anyone less pro-Western than President Vladimir Putin in office. However, for Putin to accept the offer would mean a dramatic change of course. Putin almost certainly will disagree with some in his inner who believe that the Saudi offer is an historic chance to regain Russia's former international standing and improve its economy. Those voices of opposition argue that the combination of Saudi financial power and advanced Russian arms would protect Moscow from Washington's wrath if the resolution is vetoed.
However, Riyadh's offer also is viewed with some suspicion within Putin's inner circle, where many believe that Wahhabi Muslims from Saudi Arabia have been major sponsors of Islamic Chechen militants. Interestingly, it was Abdullah al-Turki who most vehemently rebutted allegations that Saudi-based Islamic charities financed the Chechen militants who held hundreds of people hostage in a Moscow theater in October.
Many of Putin's advisers also treat Riyadh's offer with suspicion because Saudi Arabia has been Russia's main rival in oil exports, but Putin's pro-Western policy is the main reason that the Kremlin is highly likely to reject the move and vote in favor of the U.S.-crafted resolution at the United Nations. The moment of truth will come Nov. 8. |
