Putin takes Russian business on first S Africa trip

MOSCOW, Aug 31 (Reuters) Russian President Vladimir Putin makes his first visit to South Africa next week with around 100 Russian business leaders hoping to build bridges between two of the world's biggest emerging market economies.

Fresh from hosting the G8 group of industrialised nations at last month's St Petersburg summit, Putin also has a mandate to tackle development issues such as trade, AIDS and education.

Both states have evolved along parallel lines since the end of apartheid and the fall of communism, as democracies struggling with social problems but blessed with mineral wealth, and the links between the two go back even further.

''The Russians as we all know are said to have close relations with some of the people now in charge of South Africa. They were trained as Marxist guerrillas by the Soviet Union,'' said Dmitri Trenin, an analyst at the Carnegie Centre in Moscow.

''Russia is trying to raise its profile globally and to break out of the circle of the usual venues for official visits.'' Diplomats say the visit is also politically important. Putin and South African President Thabo Mbeki both have good relations with Iran, as well as with US President George W Bush, and both are opposed to conflict over Tehran's nuclear programme.

But despite their common interests, trade between the two was a measly 170 million dollar in 2005. Putin wants more.

''Both sides agree that it's far below the potential,'' said one diplomat. ''(The visit) is going to mark a turning point in relations and we expect there are going to be a lot of developments in the business relationship.'' Prominent among Putin's delegation will be Viktor Vekselberg, a billionaire who controls aluminium firm SUAL and has 49 per cent in South Africa's United Manganese of Kalahari.

Russia's top steelmaker Evraz is also moving into South Africa.

Last month it unveiled a 678 million dollars takeover of Highveld, South Africa's No.2 steel firm and the world's top supplier of vanadium, which is used to strengthen steel.

METAL COOPERATION Kremlin officials and diplomats were coy on specific deals to be signed during the visit, which is sandwiched between a trip to Greece on Monday and departure for Morocco today.

Chris Weafer, strategist at Alfa-Bank, said Putin was likely to try to establish cooperation on metals in the same way that Russian gas giant Gazprom had forged links with Algeria's Sonatrach to strengthen their position in selling gas to Europe.

Besides energy and minerals, Russia's other big export is arms, which one diplomat said would be briefly discussed.

The trip is Putin's first to sub-Saharan Africa, and besides the bilateral talk about trade and politics, his G8 role gives him the chance to discuss issues affecting the wider region.

One such issue is AIDS, which has afflicted both Russia and South Africa, and both Putin and Mbeki have been criticised for failing to face up to the problem.

''Putin has done an impressive turnaround in the last year and that is something he should discuss with Mbeki,'' said Jon Liden of the Global Fund to Fight AIDS, Tuberculosis and Malaria. ''President Mbeki still doesn't seem to be fully aware of the catastrophe in his country.'' Reuters LL VV2059