In the face of the brutal Russian escalation in Ukraine, a new wave of sanctions imposed by Western countries weighs on Russia. However, the recent exclusion of Russian banks from Swift – a system that supports global payment transactions – would not only be affected in Europe but also in Latin America, especially the countries allied to the Kremlin.
The head of Security for the Western Hemisphere of the White House, Juan González, maintained that Cuba, Venezuela and Nicaragua would feel the impact of the sanctions due to the economic relationship that these countries hold with Russia.
In the case of Venezuela, the oil industry could be the main affected, according to economists told the German press. “Nicolás Maduro must be quite worried. Although the war of his Russian counterpart, Vladimir Putin, against Ukraine is far from Venezuela, the consequences of the sanctions will be felt in the socialist regime in Caracas. Russia has become an important transhipment point for Venezuela”, they pointed out.
“Maduro uses the Russian banking system to avoid US sanctions and be able to continue exporting oil and also large amounts of gold. Caracas needs foreign currency to, in turn, be able to import food and other goods for Venezuela,” they added.
Venezuelan oil
One of the companies that could be affected is the state-owned Petróleos de Venezuela (PDVSA). “PDVSA has accounts in Russia and could now face difficulties moving money and making bank transactions,” Ryan Berg, an analyst at the Center for Strategic and International Studies in Washington DC, told DW.
Likewise, the drastic fall of the Russian ruble would also affect the sums of money that the Latin American country could have in Russian bank accounts.
Defense and agriculture
In February, Maduro signed new military and energy agreements with Russia. However, with the recent sanctions imposed on the government of Vladimir Putin, it is possible that“Russian companies that produce military equipment cannot sell to Venezuela, Nicaragua or Cuba” Berg maintained.
Venezuela depends on food imports, especially wheat from Russia. The sanctions could have a very negative effect on these imports due to inflation, which will increase the rise in the prices of basic necessities.
Cuba
Since Russia declared war on Ukraine, several countries have been economically affected, due to the cancellation of various Russian airlines, including Cuba.
According to experts to EFE, the temporary cancellation of flights by Russian airlines Aeroflot and Azur Air will seriously affect the economy of that country.
In the first instance, the Aeroflot website does not have available flights to Havana and Varadero, which is the main vacation destination on the island. While, in the case of Azur Air, the company clarified in a statement that for the moment they will only have flights available to repatriate tourists who need to return from Latin America to their countries of origin.
“Tourists will return in a planned manner, according to the dates indicated on their tickets,” the company said.
Carmelo Mesa-Lago, professor emeritus of Economics and Latin American Studies at the University of Pittsburgh, assured EFE that there will be strong repercussions due to the cancellation of Russian flights in Cuba, a country that depends on international tourism.
“Where the blow will be most noticeable is in tourism, so the island will urgently need to earn foreign currency. Sanctions against Russia are clearly going to harm Cuba because bilateral trade is important”, he indicated.
At the beginning of the tensions between Moscow and the Western powers due to the crisis in Ukraine, Miguel Díaz-Canel demonstrated his country’s position of support for Russia and criticism of the United States.
At that time, the Cuban Foreign Ministry blamed Washington for threatening Russia and manipulating the international community in the face of an alleged “imminent massive invasion” of Ukraine.
Nicaragua
In the case of Nicaragua, President Daniel Ortega’s position of support for Russian President Vladimir Putin could bring this country serious consequences, after the sanctions imposed by the United States and the European Union on Moscow for the invasion of Ukraine, warn economists and analysts.
Nicaragua depends largely on the United States and is the main country where its exports go, former deputy and economist Enrique Sáenz told the Voice of America. Russia, on the other hand, does not even stand out in the main numbers of the Central Bank of Nicaragua in terms of remittances.
According to the Central Bank, of the more than 2,000 million dollars in remittances received in Nicaragua in 2021, 63.8% came from the United States, followed by Spain and Costa Rica.
Regarding exports, Nicaragua sold 3,560 million dollars to the United States, 60% of its total exports, more than the rest of the Central American countries combined, which together bought 794 million dollars in Nicaraguan products.
After the US, there are Mexico, the European Union and, lastly, Russia, with barely 12 million dollars in Nicaraguan exports, according to the Voice of America report.
Since Ortega came to power in 2007, relations between Managua and Moscow have intensified.
After assuming command of Nicaragua, Ortega has signed important loans with Russian banks, as a way of breathing life between blockades by international organizations after the controversial elections held in 2021, in which he was the winner after jailing dozens of opponents.
“The only thing that can be received from Russia are tanks and weapons because economically it is a country that really does not have greater possibilities and will have fewer with the sanctions that it is currently being subjected to”Saenz added to VOA.
The president of the Lower House of the Russian Parliament, Vyacheslav Volodin, was received at the end of last month by the Nicaraguan Parliament, in the midst of Russian military actions against Ukraine.
During a speech in Managua, Volodin justified the Russian aggression against Ukraine and assured that “it was a peacekeeping operation.”
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