Only few weeks before he leaves office, Russian President Vladimir Putin arrived in Libya on Wednesday for a two-day visit likely to be dominated by discussions on energy cooperation, arms deals and debt negotiations.
Putin's visit may bring closure to several large arms deals totaling $2.5 billion, which are aimed at bolstering Libya's aging weapons arsenal, Russian media outlets reported. The deals will include anti-aircraft systems, MiG and Sukhoi aircraft, helicopters, submarines and warships, the Russian news agency Interfax said.
"The media are always interested in arms deals… but the main issue for Russia will be Libya as a trading partner, which is something that almost every country in the world is interested in, because Libya, with a high oil price, has a lot of money to spend," Oliver Miles, a former British ambassador to Libya, and currently deputy chairman of the Libyan British Business Council, told The Media Line.
Last week, the state-run Russian gas company, Gazprom, revealed it was negotiating with its Italian partner, Eni, about a potential asset swap involving projects in Libya. The heads of the two companies have met with Putin recently, although the content of their discussions has not been fully disclosed.
International competition over foreign investments in Libya has been heightened as a result of the country's recent moves to open up.
"There are many things that we in Britain, for example, or the French, or other exporting countries, would wish to sell to the Libyans, and naturally we see the Russians as competitors," Miles said.
Regarding the military aircraft deal, Miles explained there was direct competition between France and Russia, which are "probably the most likely suppliers of military aircraft to Libya."
The former ambassador explained that a French-Libyan deal for the purchase of military aircraft was considered a done deal at the time of French President Nicolas Sarkozy's recent visit to Libya.
This competition also hit the news last month, when reports indicated that Algeria had decided to terminate a contract to purchase 35 MiG29 aircrafts from Russia.
Algeria began refusing deliveries from May 2007, and in October it stopped payments on other military contracts, pending the return of the MiGs to Russia.
"The reasons for the termination of the Algerian contract are likely to lie in the realm of politics," said head of the Russian Federal Agency for Industry, Andrei Dutov.
The French media recently indicated that two months ago Sarkozy tried to persuade Algeria to purchase French aircraft with similar technical features as the MiG29.
Russian arms export monopoly, Rosoboronexport, signed a contract to deliver the MiG29 fighters in March 2006 as part of an $8-billion military-technical cooperation agreement with Algeria.
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