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Triangle Trade

[ 22 ] January 4, 2012 |

This week’s Over the Horizon column suggests that the Russian arms industry is in for some long term trouble:

During the Cold War, the Soviet Union’s military-industrial complex sustained the massive Soviet military institution, which regularly gobbled up 15-25 percent of the nation’s GDP. In an odd and unexpected twist to the end of the Cold War, the Russian arms industry has turned to sustaining itself by arming a pair of Asian giants: Arms exports to China and India have proven lucrative for Russia — and have even had a synergistic and competitive quality. The unease each country has felt due to the other increasing its military capability has led to higher revenues for Rosoboronexport, the Russian state-owned arms exporter. For the post-Cold War Russian arms industry, this trade has represented a boon, helping to replace lost customers in the Middle East, Eastern Europe and the Russian military itself. However, this situation is almost certainly unsustainable in the long run, as both China and India appear to be outgrowing their dependence on the Russian military-industrial complex. This will spell trouble for Russia, which has had great difficulty developing exports based on anything other than arms or energy.

 

Comments (22)

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  1. c u n d gulag says:

    Export less arms, and more vodka!

    You aim at the “Chopin Vodka” market, by introducing “Tchaikovsky.”

    And the “Van Gogh Vodka” one, with “Shishkin.”

    http://www.tanais.info/art/en/shishkin35more.html

    And Stolichnaya’s still pretty damn good.

  2. wiley says:

    Unless the whole world is suddenly powered by green and renewable energy sources, if they play their cards right, Russia may be able to make suitable products for export to much of the developing world— products that will be far more productive and produce more stable clients, in the long term, than arms’ sales.

    In spite of some bad seasons, they also grow a lot of wheat.

    Also, Siberia may be completely defrosted soon, and prove itself to be quite uniquely fertile. If they don’t make the same mistakes they made during the Cold War— poisoning and polluting it until it can scarcely be recognized anymore— then that land might provide them with a century or two of productiveness for themselves and for export.

    It just seems old-school and maladapted to me to worry about a country’s inability to be a major player in the arms’ trade, when the market for alternative energy is begging for breakthroughs, and easily a hundred developing nations are getting ready to join the digital age.

  3. Arcinian says:

    Russia is in for some long term trouble, IMO, and has been for a long time. Having been born there I avoid almost all news sources on the topic because it makes me too sad, I just can’t imagine a plausible senarior where things get much better in the next 50 years or so.

    • This observation makes me question the utility of the term “BRIC nations.”

      Brazil, India, and China are booming. Their role on the world stage will only increase in coming years.

      Russia? Not so much.

  4. actor212 says:

    Well, it’s not like nations haven’t become fabulously wealthy exporting energy, Robert….

    • Murc says:

      For some definition of “nation” and “wealthy.” I firmly believe that within my lifetime, we’re going to see a lot of private jets make one last flight from the petrostates carrying their one-percenters, who will happily establish dynasties in Switzerland or Monaco or someplace while their putative homelands crash and burn back into third-world status.

      • actor212 says:

        True, especially given peak oil, and Russia has maybe twenty years of oil in its ground despite being the largest net oil exporter (7 million bbls/day v. 10 million bbls produced,) but Russia has natural gas reserves that exceed any nation on earth, and the second largest coal reserves.

        Plus, it could conceivably position itself as the largest producer of solar energy in the world.

        I know, right? Russia?

        • c u n d gulag says:

          Also, there are a lot of minerals underneath that melting permafrost.

          Russia has been sitting on a lot of untapped wealth, and waiting for technology to advance enough to allow the country to get at it.
          And now it has!
          No, not with new technological breakthroughs – but with good old CO2 and “The Greenhouse Effect.”

      • wileywitch says:

        Hopefully, some group of people would be organized, trained, determined, and able to kill the fucking bastards and take the money back. That’s the only sane response to that level of violence (oh yes, leaving an entire nation in squalor and disorder after stealing the rights and fruits of it’s resources and all those people’s labor is VIOLENCE— deadly violence.)

  5. John says:

    I’m not at all clear on how good Russian equipment is; has modern Russian equipment been tested against modern Western equipment and found to be competitive? In both wars against Iraq Soviet equipment ended up being wiped out quite quickly in the conventional phase, and both Libya and Serbia seemed to be almost completely unable to keep their airspace clear. I know all these cases involved fairly overwhelming odds against the Eastern-bloc supplied combatant, so I’m interested: Do countries only buy modern Russian gear to defeat enemies with older Soviet and Western equipment, or does such equipment genuinely deter Western powers as well?

    • John F says:

      Tactics and training had a lot to do with how quickly Iraq’s equipment was eviscerated. Libya and Serbia were so numerically outnumbered in the air that “quality” hardly mattered.

      In both Iraq/Gulf wars (especially the first)- Iraq’s armored forces consisted of 2nd tier Soviet stuff that was subjected to the end result of a 30-40 year effort by the West to neutralize the Soviets huge numerical advantage in armored weapons.

      Soviet/Russian small arms are perfectly fine, Soviet air defense systems “work”- they function- the problem is counters have been developed that largely neutralize their older systems.

    • wileywitch says:

      Many countries have bought outdated U.S. weapons to fight countries that had outdated Soviet weapons. If someone here can think of an instance of the U.S. selling it’s aging weapons to a country fighting another country that is using mostly aging American weapons, it wouldn’t surprise me.

      I vaguely remember during the Bush administration an arms dealer getting busted for selling Russian munitions to U.S. when our government started arming itself and military contractors like “Blackwater” (now Xi) to the teeth to fight the epic crusade again terrorism itself and the whole Muslim world. I believe, we bought a lot of his wares before he got busted.

    • wengler says:

      States buy Russian stuff because it is cheap, plentiful and will easily defeat everyone except for NATO countries’ weapons.

      Also, the really expensive military items(fighter jets) usually require an extensive training relationship with the originating country. Anything that can’t be bought through a third party becomes politically complicated for many countries.

  6. fourmorewars says:

    Why’s the term Triangle Trade being lazily applied here? Doesn’t quite match the way the original worked, does it?

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