Russia signed a $1 billion military loan deal with Venezuela yesterday while pledging to upgrade its own military, the New York Times reports. The country plans to ratchet its defense budget back up to Cold War levels next year and intends to have new warships built by 2020. President Dmitry Medvedev said the Georgia conflict exposed serious weaknesses, and he vowed to return Russia to a state of permanent combat readiness.
Venezuela President Hugo Chavez hailed the defense loan and the creation of a joint oil consortium as "a colossus being born.” Pentagon chiefs downplayed the significance of the deal but others worried that a fierce—and unpredictable—bear has stirred from hibernation. The country “has risen from its knees," one military analyst said. “Russia wants to behave as a great power.”