Stratfor: “Russia and France: New Levels of Cooperation”
Russian Prime Minister Vladimir Putin, Deputy Prime Minister Sergei Ivanov and Defense Minister Anatoly Serdyukov are visiting Paris to meet with French President Nicolas Sarkozy and other French government officials on June 20-21. The visit quickly follows the conclusion of an agreement between Russia and France for two French Mistral-class amphibious assault ships, worth $1.7 billion, that France has agreed to sell to Russia with the full technology transfer Moscow demanded. The ships would be built in France and delivered in 2014 and 2015, with the potential for another two to be built in Russian shipyards under French supervision.
The Russian officials’ visit is a chance to very publicly emphasize the Mistral deal, a boon for the Kremlin which wants to signal to the rest of Europe that it has a strong security relationship with France (part of its ongoing campaign to unsettle the Central Europeans and make them doubt the commitment of their West European NATO allies). It is also an opportunity to discuss several other deals the two countries are working on, covering energy, military and space technology cooperation. For France, building close ties with Russia is about ensuring that the evolving Berlin-Moscow relationship does not leave Paris unable to affect security issues on the continent.
Russia and France’s Deals
The Mistral deal is the most significant transfer of Western military technology to Russia since the end of World War II. Mistral-class amphibious assault ships are very flexible platforms that can embark helicopters and landing craft, as well as carry troops, armored vehicles and supplies. France’s Tonnerre, a Mistral-class vessel, deployed off the coast of Libya with a number of attack and reconnaissance helicopters, was recently brought to bear in NATO’s ongoing intervention. While STRATFOR does not have insight into the specifics of what was included in the package, Russia demanded that the sale include the transfer of sensitive technology, specifically the Senit 9 command and control system which is capable of NATO-standardized functionalities. The future Mistral-class vessels will provide Moscow with power projection capabilities in a number of sensitive areas, including the Far East’s Kuril Islands and the Baltic and Black seas. Not surprisingly, the sale has been met with disapproval in Japan, the Baltic states and Georgia.
However, the Mistral deal is only a part of upcoming Franco-Russian collaboration. Paris intends to fully participate in Russia’s ongoing modernization and privatization efforts.
The French energy giant Total — privately owned, but with close ties to the state — has an ambitious plan for cooperation with Russia. Total plans to take a 12 percent stake in Russian natural gas production company Novatek — Russia’s second-largest natural gas producer, 10 percent of which is owned by Gazprom — raising its stake to 19.4 percent in 2013 with the option to raise it to 49 percent after 2013. Novatek produces natural gas for the domestic Russian market — only Gazprom exports natural gas at this time, although Moscow is trying to diversify its exporters in order to create more competition — and has close links to the Kremlin. Total will also take a 20 percent stake in the Yamal liquefied natural gas (LNG) project. The project would get its natural gas from the nearby Bovanenkovo field, which according to Gazprom, is ahead of schedule and should be producing by 2016. Total participated in the Snohvit LNG project with Norwegian Statoil, so it would not be its first LNG project in Arctic conditions; however, the project would be the most difficult LNG project ever attempted, so it is unclear if Total could complete it on its own. Total is already present in region, developing a series of fields just south of the Yamal peninsula, and could start taking on projects with Gazprom in the region.
France and Russia are also looking to further their military and space cooperation. France’s partially state-owned military technology company Thales is looking at the potential Russian Technologies privatization. Russian Technologies is Russia’s military industrial umbrella and oversees nearly every Russian military industrial company. The privatization would only be for a 10 percent stake (which would give Thales two seats on the board), but it is very lucrative because it would allow the company to get a glimpse of Russian military technology. It is unclear if this privatization will happen, though Russian Technologies has been courted by numerous global military powers.
Also, Ivanov held private talks with his French counterparts regarding cooperation in space. Russia has already reportedly attracted a number of Houston-based NASA employees who were laid off recently and wants to expand cooperation with the French.
The Logic Behind the Cooperation
The upcoming collaboration between Russia and France is considerable. Paris is trying to catch up to the already developed Russian-German relationship. For France, the logic behind enhancing its relationship with Russia is to make sure that Paris is not left behind as Russia and Germany deepen their relationship. Recently, Germany and Russia have enhanced both energy and military links. Because of Germany’s decision to eschew nuclear energy, Moscow and Berlin are about to enhance their already strong natural gas trade, with Gazprom looking to enter the market for electricity generation in Germany by helping German utility E.On build natural gas power plants. This comes as the massive underwater natural gas pipeline Nord Stream — which is expected to reach its full capacity of 55 billion cubic meters in 2012 — becomes operational this year. Meanwhile, German private defense company Rheinmetall will construct a combat training center for Russian troops. Berlin and Moscow are also cooperating diplomatically on resolving the impasse between Moldova and its breakaway region Transdniestria, using the issue as a trial case for the planned EU-Russia Political and Security Committee.
France sees Berlin and Moscow cooperating and wants to make sure it develops its own relationship with Russia independent of its relationship with Germany. The easiest way to do this is to offer Russia military and energy technology that Germany simply does not have. At the same time, the type of collaboration that Paris is pursuing with Moscow is highly optional, allowing France to divest itself of its interests in the future if absolutely necessary. This is an important qualification because Berlin, for example, is becoming dependent on Russia for energy resources.
A relationship with Russia is also insurance against a potential — although unlikely for now — break with Germany. With the eurozone’s fundamentals shaken and Germany increasingly acting in its own interest to the apparent detriment of the European Union, Paris needs to build relationships with regional powers outside the context of the union. Russia is a perfect partner, since Paris and Moscow have no directly overlapping interests or spheres of influence. This explains why the two have cooperated so well in the past, often with the specific purpose of isolating a united and strong Germany.
For Russia, strengthening ties to France has both geopolitical and practical purposes. First, Russia needs technology and France can offer at the right price. Second, as Moscow deepens its relationship with Paris and Berlin, it effectively ties itself to the European Union’s two leaders. This will certainly upset Central European NATO and EU member states as they try to counter the Russian resurgence on their periphery. Moscow, meanwhile, will endear itself to Western Europe — Spain and Italy will also receive lucrative deals in Russia’s privatization and modernization drive — and trust that pressure from the EU leadership will keep the United States out of the European continent.
