"How The World Sees Russia" Issue #41: 01/26/2019 From the Publisher: What are Russian private military contractors (PMCs) doing in Venezuela? With this question, we begin this week’s Rossiya Scan. A group of around 400 Russian mercenaries is said to have been dispatched to Caracas to protect the embattled authoritarian Venezuelan President Nicolas Maduro. Russia has financial interests in Venezuela ​, and we try to decipher its moves through this specific scope. Putin remains popular in Russia. However, a weak economy and foreign adventures are starting to take a toll on the Russian leader. Putin’s domestic popularity, although still strong when compared to most world leaders, is said to have hit an all-time low. Putin has the tough task of maintaining an ambitious foreign policy agenda, and keeping things well at home. Can he achieve this? We break down the situation, and shed some light into this difficult question. Can Russia lose its influence on Serbia? The strong relationship between these two is being tested as Serbia continues to make progress in its EU membership accession. Is Russia about to lose a close ally in heart of the European continent? Unlikely, but the possibility of this relationship weakening, or changing drastically in the future exists. Hence, we again delve deeper into the strengths and weaknesses of this unique relationship, in the context of the most recent current events. Finally, we look at how Russia is likely to put a halt on its fight with U.S shale producers. A price war would hurt Russia economically, and this is something that it cannot afford. -Rossiya Scan Russian Mercenaries Land in Venezuela... Russian private military contractors (PMCs) have allegedly been dispatched to Caracas to fortify security measures for Venezuelan autocrat Nicolas Maduro. The latter is facing a fight for his life because of a strong play by a revitalized opposition movement that seeks to oust him. The Venezuelan National Assembly, which is controlled by opposition parties, named Juan Guaido, its body head as interim President of Venezuela. Guaido has been recognized as the new president of Venezuela by the U.S, Canada and almost every Latin American country. France, Germany and Spain are also expected to follow if Maduro does not call for elections in the next 8 days. Russia and China, the biggest financial backers of Maduro’s inept and autocratic regime, have stood firmly behind him. Both Beijing and Moscow have an immense amount of money invested in Venezuela, and are afraid that a new government will not recognize what their owed as creditors. “The order came down on Monday to form a group to go to Venezuela,” said Yevgeny Shabayev, head of the Khovrino Cossack Organizatio, in an interview with the Guardian. “They are there to protect those at the highest levels of the government.” Shabayev is also a former soldier of fortune, who routinely speaks to the media about all matters relating to Russian PMCs. “Our people are there directly for [Maduro's] protection,” said Shabayev to Reuters, further adding that the PMCs were sent in an effort to prevent soldiers from Venezuela’s security forces from arresting Maduro. Shabayev is not an official state channel, however, his role with the Cossacks makes him a quasi-official channel, according to some analysts. The Kremlin said they had no information regarding this event. They are also unlikely to comment further. After all, Russian PMCs are supposed to be private enterprises with no government connection. Moscow's man in Caracas though, Ambassador Vladimir Zaemsky, dismissed the story of Russian PMCs in Venezuela as a "hoax", according to state-owned news agency Sputnik. Shabayev and other unnamed sources, have stated that Russian PMCs in Venezuela are estimated to be around 400, and have been there in some form or another since 2018. Russian PMCs have become a staple of Russia's parallel diplomacy. Company's like the Moscow-based Wagner Group, one of the most visible groups of the Russian PMCs industry, are said to be very involved with the Kremlin's foreign policy agenda. In the Middle East and Africa they have even become a fundamental part of the security apparatus of ally governments to the Kremlin. Where would Syria’s Bashar al-Assad, the Central African Republic’s Faustin-Archange Touadera and Libya’s Khalif Haftar be without Russian aid? Either overthrown, or at best fighting for their lives. As stated in prior issues , Russia lacks a capacity that the U.S and EU have. This is the ability to drastically change an allied country's infrastructure, or assist them in the development of long term policies that can lead to a higher standard of living for their populaces. Russia, however, does have an edge when it comes to providing military support. They have less scruples, and act in a pure realpolitik sense. They have no ideological concerns and as a result do what is necessary to get their end of the deal. Can Russian PMCs make a difference to Maduro? On a personal security level, yes. However, they are unlikely to do much if the military does turn on him and oust him. Perhaps, this is what Russia is trying to sell to future autocrats, and current ones that have accepted their security package (e.g. Syria and the Central African Republic ). That even when things get too tough for their government survival, they will be provided with at least their own personal security to survive. By doing this though, Russia is effectively writing off their Venezuelan investments once an opposition led government attains power in Caracas. If Russia were to be truly concerned with its money in Venezuela, it would employ the broker approach that it has used in other parts of the world. If Moscow were to reach out to the Venezuelan opposition, which has on its side the professionals with the expertise necessary to ensure that foreign debt payments are met in the future, and provide them with assurances that they will cease to support the Maduro regime, Russia would actually increase the likelihood of seeing a return on their multibillion dollar loans. Of course, Moscow does not have a strong understanding of Latin America. They have failed to adapt their strong foreign-policy playbook to this region, and because of this they are now increasingly relying on 'Hail Mary' type moves. Read more: "Exclusive: Kremlin-Linked Contractors Help Guard Venezuela's Maduro," by Maria Tsvetkova and Anton Zverev for Reuters. "Russian Mercenaries Reportedly in Venezuela to Protect Maduro," by Andrew Roth for the Guardian. "Russia Mercenaries Reportedly Descend On Venezuela To Protect Maduro's Regime," by Joseph Trevithick for The Drive. "Russia Mercenaries Arrive in Venezuela To Shore Up Maduro's Rule," by Moscow Times staff. Is Putin Losing His Grip On Power? On the 18 th of March 2018, Russian President Vladimir Putin was re-elected as President of Russia with a staggering 76% of the vote. Putin's nearest competitor, millionaire communist Pavel Grudinin, received only 12%. Inaugurating his fourth term as President of the world’s largest country by landmass (6.6 million square miles), Putin faces profuse headwinds. During his first term in 1999, Russia and the “outside” world were different, still reminiscing the Cold War era. Free flow of information, social changes, technology have reshaped the world, and thus today's politics. However, following his overwhelming victory in March, polls indicate that 10 months down the road, Putin faces a 13-year low in trust by the people he has led for so long. Is Putin getting sloppy? His foundations wobbly? Or has the panorama simply changed so drastically that this was inevitable? In order to understand this change of events, we need to dwell into the past and understand how Putin rose from a Russian Intelligence agent, to local politician; and when becoming President implied a ceiling, crowned himself the new “Tsar “of Russia. Early on his career in the KGB, Putin learnt how the machinery in a totalitarian state functioned, mastering the art of control and deceit. Rising to local politician as deputy mayor of St. Petersburg, he made a name for himself as the go to person. Once Putin became the head of the FSB (former KGB) and moved to Moscow, he did so with his trusted team. With time, he positioned friends and political allies in key government and corporate positions reporting directly to him; cementing his control on Russia. Putin believes in loyalty, rewarding those who follow and crushing those who don’t. He once stated, "It's better to be hanged for loyalty than be rewarded for betrayal”. This pretty much sums up Putin’s reign over his political associates. Now Putin finds himself in “disaccord”, with the foundations which he has so strongly built as a firm leader of the people. Even though allies control the organizations that run the country, the two fundamental pillars of governance, which are the army and the people are disgruntled with him. There are several reasons for this dissatisfaction, one is a consequence of low oil prices and economic sanctions. Ironically, the latter is the aftermath of the annexations of Crimea, which on the short term boosted his popularity to all times high; whilst causing distress on the long run. Russian people are feeling the pain, unlike Putin’s loyalist who continue to display their wealth on social media. The old guard is not adapting to the needs of the masses, and the people have changed. Corruption and free flow of information (with all that it entails), has made the weaknesses of Putin’s government more visible, creating discontent across all factions. It’s possible that Putin’s means to pursue his objective of restoring Russia’s global importance, is not aligned with the wishes of his people. Russians are tough, fearless and have a habit of revolting against their rulers. Putin needs to be careful, as the oppressed masses