Tag Archives: Ukraine

Why Germany Loves Russia: geo-economics in action

merkel putin

Chancellor Angela Merkel’s deputy chided Siemens AG (SIE) Chief Executive Officer Joe Kaeser for traveling to Moscow, saying German companies shouldn’t sell out European values to protect business with Russia.   The conflict over Kaeser’s meeting with President Vladimir Putin last week underscores the rival forces tugging at Merkel during the crisis in Ukraine. While the European Union and the U.S. seek to punish Russia for annexing Crimea, many German corporate leaders view Putin as an economic partner.

Frankly, I found the scene a bit off-key,” Economy and Energy Minister Sigmar Gabriel, a Social Democrat who is also vice chancellor, said of Kaeser’s trip to Moscow in an interview with ARD television yesterday, according to an e-mailed transcript. “We don’t want economic sanctions, but we also have to show the Russian president that we can’t accept” his “imperial policy.”

Merkel, who learned Russian while growing up in communist East Germany, heads Russia’s biggest EU trading partner during the worst standoff since the end of the Cold War. Putin risks a “tough reaction” from EU governments if he escalates the crisis over Ukraine, she said on March 26.  While Merkel has said Germany could withstand the economic impact of European economic sanctions against Russia, the heads of Adidas AG (ADS), ThyssenKrupp AG (TKA) and Deutsche Post AG (DPW) questioned the need for sanctions, according to the transcript of a round-table interview with the Die Welt newspaper published two days ago. It showed the CEOs saying EU policy makers mishandled their engagement with Ukraine while affronting Russia.

Asked if Putin must be stopped, Adidas CEO Herbert Hainer said, “I’d turn the question around,” according to Die Welt. “I wonder if one shouldn’t have included Putin in the process much earlier, rather than starting talks when it’s too late.” ThyssenKrupp CEO Heinrich Hiesinger said “Russia felt cornered.” Deutsche Post CEO Frank Appel said the U.S. and its allies had meddled “in the front yard of another big power” and questioned calls by EU leaders including Merkel to review Europe’s energy ties with Russia, saying Germany “will always be dependent on others” for fossil fuel, according to Die Welt.

Kaeser said meeting with Putin showed that Munich-based Siemens, Europe’s biggest engineering company, “won’t be overly influenced by short-term turbulences” involving Russia. “We’re counting on dialogue and mutual understanding,” he said in a ZDF television interview after returning from his trip, which he said Merkel’s chancellery knew about in advance.

By Tony Czuczka, Siemens CEO Rebuked as German Business Defends Putin Partnership Bloomberg, Mar 30, 2014

Where it Never Died: Nuclear Power in Russia, Urkraine and Belarus

Twenty-five years after the Chernobyl disaster, Eastern Europe is still clinging to nuclear power. The anti-nuclear movement is essentially non-existent, but experts say ‘green’ energy is still a viable alternative. Don’t panic, it’s really not so bad! This is a sentiment that has been repeated by leading politicians in Russia, Belarus and Ukraine since the start of the crisis at the Fukushima nuclear power plant in Japan. They view this neither as a second Chernobyl, nor as a reason to consider ending the use of nuclear power. In the eyes of Russian President Dmitry Medvedev, for example, nuclear power is “absolutely safe.”

In fact, the Kremlin is planning to more than double the number of nuclear power plants in Russia from the current 10 by 2020. There were even plans to build a nuclear power plant in the Pacific Ocean. However, analysts say that since last month’s powerful earthquake and tsunami, that idea is being revisited and the project may well be cancelled.

Belarus and Ukraine also see nuclear power as the way forward. Ukraine has four nuclear plants and there are plans for a Russian firm to build two more reactors at one of them. The Russian energy firm Rosatom is to begin construction of the first nuclear plant in Belarus in the autumn. Belarusian officials signed the contract on March 15, just days after the nuclear disaster in Japan.  Tobias Münchmeyer, a nuclear expert at Greenpeace in Berlin, believes the difference between Western and Russian nuclear power plants in terms of safety is “much less” than widely believed. According to Münchmeyer, most power plants in Eastern Europe are no less safe than their Western counterparts. But 11 Russian reactors, of the same type involved in the Chernobyl disaster, are an exception. These, Münchmeyer regards as “particularly dangerous.”….

Russian and Ukrainian politicians have repeatedly claimed that there is no alternative to nuclear power. But Münchmeyer disagrees, arguing that Moscow could do away with the use of nuclear power relatively quickly, as it currently accounts for just 17 percent of the electricity produced in Russia. This could be replaced, he said, with power generated by renewable sources or gas.  The situation in Ukraine is quite different. The four nuclear plants there account for 48 percent of the electricity produced in the country. But at the same time, the country produces an excess of power and exports what it doesn’t use itself….

For Russia, Ukraine and Belarus the future is nuclear, Deutsche Welle, Apr. 23, 2011