German-Russian Relations: Practice and Prospects By Pádraig Murphy

German-Russian Relations: Practice and Prospects

NOVEMBER 2018 BY PÁDRAIG MURPHY

German-Russian relations go back over a thousand years. It is important to take this into account because this history is ever-present both to the two main actors and to all their neighbours – particularly those situated between the two. As a German journalist noted in 1989: “The Russians have always played a special role in the fantasies of the Germans and the Germans in the fantasies of the Russians, that is the history of almost a thousand years which has carried over from two gruesome world wars”. Historically, represented Western Christianity for Moscow; for the Germans, was Eastern Christianity in the shape of what Russian ideologists called “the Third Rome”. The historian Gerd Koenen has spoken of a German “Russia Complex”, “a long-running shift between angst and admiration, a phobic defence and empathetic contribution which characterised both sides”.

Looking East, Looking West

Bearing this in mind, but without going through the history of the intervening years, it should be noted that Germany was divided after World War II by the victorious powers and that, in its western part, the strategy of Konrad Adenauer, to reject offers of normalisation with the USSR in the prospect of unification, with full support from the Western allies, won out against the more nationalist approach of the then leader of the SPD, Kurt Schumacher. The Adenauer strategy, called Westbindung, or maintaining close relations with the West, came to characterise the CDU’s line on relations with the USSR until Helmut Kohl’s time. The SPD was more open to dealing with the USSR and, in due course, this was reflected in what was called theOstpolitik of Willy Brandt, the architect of which was Egon Bahr, who subsequently adopted a rather nationalist line in maintaining Germany’s right to conduct an independent foreign policy. Although the Ostpolitik was to become an approach common to all the established parties, the nuances of the CDU/SPD attitudes to the USSR/Russia have remained noticeably different, with the SPD generally more understanding of Russian sensitivities.

Ostpolitik saw the key to reunification as lying in the USSR. The path to this reunification consisted in demonstrating that not only did Germany no longer pose a security threat to Moscow, but that there were pronounced economic advantages to be gained from normalising relations with a new Germany. The path wound slowly from a – significant – beginning in 1981 with agreement by a consortium of German banks, led by Deutsche Bank, to provide financing of

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3.4 bn Deutschmarks for the construction of compressor stations for a pipeline to bring natural gas from the new field of Yamal to the Soviet borders, to be further transported thence to Germany. The project became a joint European one and was pursued to finalisation in 1982-4 against the background of US sanctions, including an embargo on supplies needed to build it. These sanctions were the subject of protests by the European Communities at the time, which called them illegal. The significance of the episode lies in the fact that this marks the beginning of close German cooperation with Russia in the gas sector. A further element was normalisation of relations with the Soviet Union’s satellite, the GDR, under the heading Wandel durch Annäherung – Bahr’s phrase - or “Change through rapprochement”. There were of course very important economic interests involved on the German side, as the amount of financing provided by German banks for the pipeline project indicates. Financing from the German side has always played a role: as part of the agreements on reunification, Helmut Kohl agreed to pay a significant sum to assist with the repatriation of Soviet forces from the GDR.

In Germany, the eventual reunification of the country is widely attributed to Gorbachev’s opening up of the Soviet Union and his ambition to build a “common European house”. The resulting gratitude is a significant factor in the German attitude to Russia. Another, equally significant, is guilt about the role played by the Wehrmacht in the Soviet Union during World War II. These factors explain why, despite repeated disappointment at the failure of the Russian state after the Soviet collapse to make progress on democratisation or reliable protection of human rights, Berlin for a long time persisted in optimism: engagement on the economic level would support political and social change, create a middle class and bring about democratisation. The term “modernisation partnership” was formally announced when Frank Walter Steinmeier was Foreign Minister in the first Grand Coalition. It was reaffirmed by his successor, Guido Westerwelle, in a speech commemorating the landmark speech of Egon Bahr launching the Ostpolitik, Westerwelle concluding significantly that economic relations could bring about change in Russia:Wandel durch Handel, or “change through trade”. Similar phrases have been used elsewhere: Westerwelle also spoke of “strategic partnership”, and Merkel became optimistic about Dmitri Medvedev’s “modernisation strategy” in 2010. Steinmeier has spoken of “modernisation through interdependence”, another variation of the Bahr phrase. The key drivers of the approach were the Government, the political parties and German business. Through it all, the logics of geographical proximity – Russia is Germany’s big neighbour – and hard-headed business opportunities were at work. The latter factor is not new, but the failure of Russia to develop has made it as operative today as when Peter the Great was opening up Russia to the West. This is the economic complementarity of a resource-rich and technology-poor Russia and a Germany which is the opposite, as well as that of a sophisticated Western entrepreneurial economy and one which continues to fail to develop.

Crimea

Russia’s annexation of Crimea and fomenting of separatism in the Donbas in 2014 was to change all this. For the first time since World War II the frontiers of a European State were changed through aggression. This was particularly felt as a betrayal in Berlin. For Germany, the CSCE agreement in Helsinki in 1975 that frontiers could only be changed peacefully and by agreement was and is a central part of a post-war peaceful order. There was a crucial collapse of trust between Berlin and Moscow. Since 2014, there has been a shift from the domination of economics over politics, to a predominance of the political. German-Russian trade was halved by 2015- 2016 compared to 2008, though it is now growing again to $55-60bn. At that, however, it is less than German trade with or the . Russia became more of a security threat than an economic and energy partner. The 2014 review of German foreign

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policy emphasised the centrality of the rule of law, strengthening international institutions and international law. In this perspective, there was a flagrant infringement by Russia of the Budapest memorandum of 1994, concluded on the occasion of the renunciation of its nuclear-weapon holdings by , which included security guarantees by the signatories, Russia, the UK and the US, against threats or use of force against the territorial integrity or political independence of Ukraine. And the Charter of Paris of 1990, which once again solemnly formalised the provisions of Helsinki as the basis for the new Europe, was flouted. These offences come against the background of other occurrences which have led Berlin to question Russia’s conformity with the standards generally accepted in the West. There was a concerted disinformation campaign alleging mistreatment of a Russian-German girl in Berlin. And there was a cyber attack on the Bundestag. has taken a leading role in maintaining European sanctions on Russia because of its actions in Ukraine, and more generally, the approach has been of containment where necessary and cooperation where possible, to use Stefan Meister’s formulation.1

European Security Architecture

Germany has long sought to place the problem of dealing with Russia into a larger framework. The idea of an overall European security architecture has been in play in Berlin for years, implicitly, by developing the CSCE, now OSCE, further. Indeed, the very transformation of the “Conference” to the “Organisation” was an effort to advance this. The most recent such attempt was made in connection with the holding by Germany of the Chairmanship of the OSCE. Wolfgang Ischinger, Chairman of the Munich Security Conference, was appointed Chairman of the “Panel of Eminent Persons on European Security as a Common Project”, set up by the OSCE in 2015. The task was to put forward proposals for the role of the OSCE in conflict prevention and management and on the basic questions of the security architecture of the EuroAtlantic/Eurasian space, in the spirit, of course, of the Helsinki Final Act and the Charter of Paris. More than a dozen high-ranking persons from Greece, Turkey, the US, Ukraine, , , Switzerland, Georgia, Russia, the UK, Poland, , Kazakhstan, Serbia and Germany met and considered this agenda. The conclusion of their deliberations was that there were such great differences between the West and Russia in the appreciation of the current European situation that it was completely impossible to agree on a common text. In the end, separate Russian and Western texts were produced. But there was a third text, that of the countries “in between”, such as Georgia and Ukraine, which belong to neither NATO nor the EU, but which do not wish to be considered in the Russian sphere of interest. Ischinger’s comment is that the “narrative abyss” between Russia and the West has only become deeper since 2015.

The questions dealt with by the Panel continue nevertheless to be topical. A recently issued RAND Report, “Rethinking the Regional Order for Post-Soviet Europe and Eurasia” concerns itself with precisely this matter.2 It has special regard to the “in between” countries, which in many ways are the central bones of contention in relations between Russia and the West, and has some interesting ideas on how a widely representative discussion on the issue might be restarted.

1 Dr Stefan Meister, Head of the Robert Bosch Center for Central and Eastern Europe, Russia and Central Asia at the German Council on Foreign Relations (DGAP), addressed the Institute of International and European Affairs on 11 September 2018. A recording of his presentation can be accessed here: www.iiea.com/eu-affairs/german-russian- relations-return-to-normal/ 2 Rethinking the Regional Order for Post-Soviet Europe and Eurasia, Samuel Charap, Jeremy Shapiro, Alyssa Demus, RAND Corporation, 2018. 03 GERMAN POLICY | NOVEMBER 2018

The Putin Factor

It is necessary to bear in mind that there is much unease in German public opinion about any sharpening of tone in regard to Russia. While 80% of Germans see as a threat, only 45% support sanctions. The Trump factor plays a not unimportant role in this matter: more Germans trust Vladimir Putin than trust Donald Trump. 14% have confidence in the US, 36% in Russia and 43% in . The trend is even more pronounced in sectors, left and right, of the political spectrum. The parties Die Linke on the left, the successor to the GDR’s governing party, and the AfD on the right, are pro Putin. The AfD is close to the Putin party, United Russia, and 61% of them see Russia as a reliable partner. The AfD is now the biggest opposition party in the Bundestag. There is also an East-West nuance when it comes to views on Russia: the East is more favourably disposed. The concern for good relations with Vladimir Putin’s Russia goes much further. A recently published book calling for such good relations, edited by Egon Bahr’s widow, Adelheid Bahr, has the title, Why we need peace and friendship with Russia. It contains contributions by the recently retired Foreign Minister, Sigmar Gabriel, the Deputy Chairman of the FDP, Wolfgang Kubicki, Antje Vollmer, of the Green Party, a former Deputy Speaker of the Bundestag, and the former CSU politician (and Eurosceptic) Peter Gauweiler.

The Trump Factor

To elaborate a little on the Trump factor. The US President has given rise to profound unease in Germany. His apparent retreat from the central role of the US in the post-war rules-based international order is very unsettling for a country such as Germany, which has historically found it difficult to manage the tensions arising from its geographical position as a large power situated in the centre of Europe and, as one of the lessons of a difficult history, has based its entire international profile on the presumption of such a firmly established rules-based order. Trump is hostile to the EU, he has cast doubt on his commitment to Article 5 of the NATO Treaty, he has withdrawn from the Paris Agreement on Climate Change, has opened doubts about his commitment to the WTO and has renounced the Joint Comprehensive Plan of Action (JCPOA), the agreement limiting Iran’s potential to develop a military nuclear capacity. These are all of central importance to Germany’s perception of its place in the world, and to its security. As well as this, Trump is clearly hostile to Germany – some say, to Angela Merkel herself. He has fumed about the German trade surplus, imposed tariffs unilaterally on trade in steel and aluminium, and threatened to do so on cars, a central element of German export trade.

There are therefore some signs that Berlin may be seeking reinsurance against such a threatening approach on the part of what has been its principal ally, and that a recalibration of relations with Russia may be part of this. Stefan Meister detects a move to renormalisation on both sides. Although Merkel had since becoming Chancellor been in regular touch with Putin – according to one calculation, since 2013 they have telephoned at least 54 times and have met fifteen times in that period. At one of those meetings, in Minsk, they conducted talks for seventeen hours on the Ukrainian situation, one of the longest negotiating marathons Merkel has conducted. The frequency and intensity of such contacts had become less in recent years, as the prospect of Russian conciliation seemed very limited. There has been a perceptible change this summer. Merkel met Putin in Sochi in May. The Russian Foreign Minister, Sergei Lavrov, and the Chief of the General Staff, Valeriy Gerasimov, visited Berlin in July. Most important, Vladimir Putin visited Angela Merkel in Schloss Meseberg, outside Berlin, on 18 August. This was the first bilateral meeting of the two in Germany since 2013. While not much was revealed about the outcome of this meeting – this may or may not be 04 GERMAN POLICY | NOVEMBER 2018

because there was not much agreement – the known agenda covers the main items of concern to each side at present. This was the situation in Ukraine, Syria, the JCPOA (the Iran Agreement) and Nord Stream 2.

There is no sign of any progress on the Ukraine question: the sides remain far apart. Before the meeting – there was no press conference afterwards – Merkel admitted that a lasting truce had still not been achieved and expressed the hope that an attempt to stabilise the situation would be made. She mentioned the possibility of organising a UN peacekeeping mission and said that Germany was prepared at all times to work within the Normandy format (Germany, France, Russia and Ukraine).

Money Alone no Longer Enough

Syria has become a key topic in relations, because the migration question which originated in Merkel’s forthcomingness in 2015 on reception of Syrian refugees, is still one of the main subjects of controversy in German domestic politics. Russia, on the other hand, is, along with Turkey and Iran, one of the main actors on the ground in Syria. With the conflict prospectively nearing its end, the question of financing of a resulting agreement arises, and here neither Russia nor Iran nor Turkey will be in a position to offer much. There is an apparent expectation in Moscow that the EU/ Germany will step in to facilitate an agreement. It is indeed clear that Germany needs stabilisation in the region in order to stem the prospect of refugee flows, not only from Syria, but from Jordan and the Lebanon as well. But Germany will not be content to be just the money-bags: Berlin, which has taken a position very hostile to Bashar al Assad, will need to be assured on political change and compliance with human-rights provisions. A new format, consisting of Russia, Turkey, Germany and France, has been established to take the matter of a possible settlement further.

JCPOA: Finding Common Ground

On the JCPOA, the two sides are likely to have been in substantial agreement, even if not much has been said about it. Along with Nord Stream 2, these are pre-eminently the areas where they find themselves united in opposition to Donald Trump. The Iran agreement is particularly important in the area of financial sanctions, where the Trump administration and the American Congress have imposed secondary sanctions on firms trading with Iran, thus threatening the trade of both Germany and Russia, amongst others, with that country.

Nord Stream 2: A Controversial Connection

The most sensitive item on the agenda – and perhaps the main reason for the meeting – was Nord Stream 2. The gas pipeline, scheduled to be completed next year (though it may be delayed), will deliver at least 55bn cubic metres (bcm) of natural gas from Russia to Germany across the Baltic Sea, doubling the quantity supplied through the first pipeline. That is, Germany will be supplied with 110 bcm per year, against the background of an annual consumption of about 80 bcm, about a third of which comes from Russia. Germany would thus become a hub for Russian supplies of gas to Europe. Though undoubtedly Merkel’s decision to end nuclear-power generation of electricity in Germany is part of her considerations, it would not be true to say that Germany will become more energy-dependent on Russia. On the other hand, the project does have geopolitical implications, despite Merkel’s and Putin’s assertions that it is a purely commercial undertaking. For a start, it will be owned by Gazprom, which is essentially an arm of Russian energy – and perhaps other – policies.

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There would also seem no doubt that one of the Russian objectives is that of avoiding the role of Ukraine as a transit country. It is strongly opposed by not only Ukraine, but by Poland and the Baltic countries as well. It is also opposed by Donald Trump, who has threatened to sanction those involved on the basis that the pipeline will make Europe and Germany inordinately dependent on Russian gas. (Not mentioned directly in this connection is his ambition to supply the market with American LNG which, apart from lacking the necessary distribution infrastructure, would be 20-50% more costly). In July, the Ukrainian President, , said: “This is not a commercial project – it is not economical or profitable – it is absolutely a political project…This is absolutely a geopolitical project.” Ukraine stands indeed to lose billions of dollars in transit fees if the gas were to be diverted entirely to Nord Stream 2.

One of Merkel’s objectives in Meseberg was to persuade Putin that gas would continue to be channelled through Ukraine. This goal does not seem to have been realised. Putin emphasised the importance of economic cooperation with Germany. He said that Nord Stream 2 was a purely commercial venture and that it would not prevent the use of the traditional transit route through Ukraine, but only if this were economically viable. This could not be seen as forthcoming in regard to Merkel’s preoccupations.

On this question, Angela Merkel seems to have under-estimated the impact of decisions taken on what purports to be a purely commercial deal. There is and has been a very strong business lobby in favour of such deals with Russia and of this one in particular, although the German role in its development is largely financial. It is relevant to recall that Merkel’s predecessor, Gerhard Schröder, sits on the board of Gazprom. Further, there are, as noted, political pressures behind promotion of relations with Russia. In this instance, the Länder of Brandenburg and Mecklenburg-Western Pomerania strongly favour the pipeline, a consideration not to be dismissed at a time when Merkel’s party, the CDU, has to fear being routed by Die Linke and the AfD in the eastern Länder. Because, on the other hand, the pipeline is owned by Gazprom, and its financing is assured, it is practically certain that the project will be brought to a conclusion.

A Conflict of Interests

It will be evident that, at a time when the US, Germany’s hitherto major ally appears to be not only abandoning its role as guarantor of a rules-based international order, but also directly, and with some evident malevolence, to be threatening central interests of Germany, the country’s leaders are looking for substitute guarantors of the order to which they, and indeed all of us, have become accustomed. Russia is certainly not seen as such a guarantor. Indeed, the new German Foreign Minister, Heiko Maas, who, though belonging to the SPD does not share that party’s hankering after a special relationship with Russia, said recently in Tokyo, where he was pursuing his agenda of finding allies in preserving the rules-based order, that Russia was a power that openly challenged the world order, saying that “Russia has challenged the world order through its annexation of the Crimea in contravention of international law and through its behaviour in Syria.” But geopolitical facts remain. Germany is increasingly seen as the most powerful country in Europe in economic terms, which have their own political implications. Even in military terms, it must be borne in mind that the NATO pledge to increase defence budgets to 2% of GDP by 2024, so insisted on by Donald Trump, would, according to one calculation, give a German defence allocation of $84bn in 2024 and thus make it perhaps the most powerful military power on the continent.

The country certainly has learned the lessons of its tragic – for the whole continent – twentieth-century history. These are the necessity of binding itself into the Western system and promoting a rules-based international order. But neither can Germany be indifferent to its big neighbour – this too is a lesson to be learned from history.Wolfgang Ischinger 06 GERMAN POLICY | NOVEMBER 2018

put it in his recently published book, firstly in regard to the Ukraine problem: a long-term freezing of the conflict, with partition of Ukrainian territory, as well as an economic tragedy threatens. “This problem cannot be solved without Russia”. But he went on: “Not only in the Ukraine question does the principle apply, that a viable European security order can only be created with Russia. It is equally true unfortunately that security from Russia must be offered to many European countries”.

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