This Means Power

Russia is the sixth largest economy on the planet. In volume of exports, we trail behind not only such monsters as the U.S. and China, but also the relatively small European countries like Italy and Holland.

Nevertheless, our exports have a very interesting structure, which is made up of … energy, raw materials and weapons. What does that mean in the modern world?

In the modern world, that means power.

With energy, it is completely understood: It is not for nothing that the States started the greater part of their wars of the last decade with the goal of gaining control over local oil sources. The world experiences a great deficit of electric energy, and he who controls the oil has enormous influence on politics.

Raw materials, again, are a deficit resource: their value will only go up and up with time. According to the German view of industrial development, the world is now transitioning from the third stage of industrial development to the fourth.

When this transition is finally realized, the lion’s share of the cost of goods will be the production of raw materials and energy for their manufacture. Thus, manufacturing countries that live by processing raw materials into finished products will simply become unnecessary. They will have to re-establish their whole economy.

It is not an accident, for example, that Boeing and Airbus have concluded long-term contracts with the primary Russian producer of titanium – the company VSMPO-AVISMA. In the future, only those companies that have access to sources of necessary raw materials will be able to survive. Of course, predicting their own conduct in the Russian market up to 2030, including the purchase of titanium, Boeing chooses the most optimistic options for itself.

Finally, the last article of our exports: the last in order, but not in significance. Weapons. Many accord Russia the position of the second-largest weapons exporter in the world, in political terms; if only on the trivial basis that the innumerable enemies of the U.S. have the opportunity to buy conventional weapons only from us.

In 2012 Russia exported weapons for the record sum of $15 billion. We have a portfolio of orders worth another $37 billion, which means that in 2013 we will successfully break that record.

A number of markets were lost to us because of political perturbations. For example, because of an embargo we cannot deliver weapons to Iran. Nevertheless, on the whole, exports are growing significantly.

Asia is growing especially fast now. More specifically: India and Vietnam. I am absolutely not surprised by this: If you recall, a few months ago experts predicted that in the next few years, they will become countries of the second echelon. If all the money and resources of the planet were previously hanging around in the countries of the “golden billion,” now the countries of Asia, Africa and Latin America will be appearing in primary roles.

Pay attention to the curious experiment of the developers of games for mobile telephones (careful, English).

In short, the developers decided to translate the simple texts of their games into the languages of various countries. After that, it quickly became clear that the markets of Russia, China and Brazil are already significantly fatter than the unraveling markets of Italy and France.

Of course, that does not mean that it’s already time to bury the Western countries. However, it does mean that in the foreseeable future they will play a smaller and smaller role on the planet.

In 2013, Russia has already fulfilled 30 percent of its plans to export weapons.

One of the largest importers of our equipment is Vietnam, which no one took seriously up until just recently. This year, at a meeting of the Ministers of Defense, [Russian Defense Minister] Sergei Shoigu announced that Russia will help Vietnam establish a special submarine fleet.

But the most important news on the export of Russian weapons is the deal with Iraq, which was very uncertain until just recently. Rostekhnadzor (represented by Rosoboronexport) successfully resolved all issues.* The volume of the transactions is $4.2 billion. Iraq will buy 30 Mi-28N attack helicopters and 42 Pantsir S1 anti-aircraft installations from Russia.

According to unofficial data, Russia will additionally supply six Mi-35 helicopters to Iraq for a sum of $256 million.

The Iraqi army will receive its first helicopters from us in September. In the coming years, Iraq plans to set aside another few billion dollars for the purchase of our weapons. Talks are now going on concerning the specifics of what Russia will deliver to Iraq.

And what do we see now?

It cost the Americans dearly to withdraw their forces as the Iraqis, hating the star-spangled marauders, swiftly turned to Russia. Russia is not only going to deliver weapons to Iraq for the enormous sum of $4.2 billion, but it will also soon receive control over a significant part of the locally produced Iraqi oil.

*Translator’s note: Rostekhnadzor is the Federal Service for Ecological, Technological and Nuclear Supervision, established in 2004. Rosoboronexport is the Russian Defense Export, a state corporation that is the sole state intermediary agency for Russia’s exports/imports of defense-related and dual use products, technologies and services.