Germany’s “disappointment” as a result of economic sanctions against Russia

The country’s political leaders speak in different tones depending on the circumstances. They don’t do it as much as they campaign on a platform, like an institutional statement, a press conference, or an environment where they feel less vulnerable.

A more intimate context than usual was achieved by the German journalist Stefan Lambi, who has been shooting, interviewing and documenting together since December 8, 2021, when the current coalition began to govern in Germany after the first general election of Angela Merkel. The action of the heads of the Teutonic government with their team. A documentary about Chancellor Olaf Scholz’s nearly two years as CEO will soon be broadcast on television.

Lambie also published a book about this journalistic work. It is called Ernstfall: Regieren in Zeiten des Krieges or “Serious Business: Governing in Time of War” (Ed. CHBeck, 2023).

In it, he gets the foreign minister, the Greens politician Annalena Baerbock, to say something that no one can ever remember hearing from any truly relevant head of office in the Scholz government. It is a critical assessment of the economic punishment that Western democracies have sought to inflict on Vladimir Putin’s regime over its illegal invasion of Ukraine.

“Actually, economic sanctions should have an effect. But they don’t. Because the logic of democracy doesn’t affect autocratic regimes,” Baerbock told Lamb in one of the interviews that feeds his latest book. The meeting took place on July 10.

Baerbock’s words, delivered just days after Germany emerged from a technical recession, were echoed by all German media. Germany’s gross domestic product (GDP) stagnated in the second quarter of this year after two consecutive winter quarters of decline, according to data released on August 25 by Germany’s statistics agency, Destatis.

One of the most critical was the conservative Roderich Kiesewetter, from the Christian Democratic Union (CDU), who claims that Western sanctions are really affecting the Russian economy and points to data such as the devaluation of its currency: the value of the ruble has fallen significantly since the end of last year and is now around 0. 0096 euros, while a year ago it was much stronger, at 0.17 euros.

According to Kieseweter, “Russia’s economy is currently like a house of cards, longer than expected, but still unstable.” He is among those criticizing Baerbock for showing what is seen as “disappointment” with sanctions against the Putin regime.

The head of German diplomacy has also been criticized by liberal and social democratic politicians, meaning to further offend those who live in the government coalition led by Scholz, which is made up of the Social Democratic Party of Germany (SPD). of the Chancellor; The Greens and the Liberal Party (FDP).

Scholz and Baerbock’s Germany, while long wary of the invading Russian army backed by Ukraine, is currently among the countries that provide the most support to President Volodymyr. Zelensky. Moreover, Germany now stands out in Europe for its military and financial support of Ukraine.

According to the reports of the Institute of World Economics in Kiel (IfW, German abbreviation), Germany has already allocated 7.5 billion euros in the form of military aid to Ukraine. This is more than any other country in Europe, including the United Kingdom (6.6 billion). Germany’s financial aid amounts to 1.3 billion and humanitarian aid to 1.9 billion, according to the IfW.

This Ukrainian aid is the key to understanding why Zelenskyi’s country tolerates Russian military aggression and continues to recapture territories occupied by the invaders. But Baerbock doesn’t seem to understand that sanctions are working against Russia. “We have proven that rational decisions, rational measures, taken between civilized governments, are not capable of ending this war,” Baerbock told Lamb.

Data such as the International Monetary Fund’s (IMF) economic forecasts presented a few weeks ago, which indicate that the Russian economy will grow by 1.5% in 2023, compared to a meager 0.3%, are very relevant in this assessment. That’s after a sharp drop to 2.2% in 2022, which he predicted earlier in the year. Meanwhile, the IMF forecast that Germany’s economy, the largest in the euro zone and the fourth in the world, would contract by 0.3%. This year, compared to the 1.9% growth recorded in 2022.

To stop the current stagnation of GDP, which has just left a technical recession, the German government has recently approved a stimulus package of 32,000 million, which is combined with a record increase in wages (6.6%) registered in August. Argument in favor of a new increase in interest rates at the meeting, which the European Central Bank (ECB) has scheduled for September 14, as the so-called meeting of the organization chaired by Christine Lagarde.

A traditional German locomotive that has been dependent on cheap Russian natural gas for decades, it is proving itself to be the country most struggling to become independent from this resource, which is the essence of what is called here the now defunct German “business model”. In 2021, up to 55% of the country’s imported natural gas came from Russia. With the start of the war against Ukraine, the tap started to be turned off and it becomes expensive to replace Russia with other suppliers.

Germany had to come up with improvised solutions to be able to import, for example, liquefied natural gas (LNG), including from the United States or Qatar. The increase in energy costs is one of the reasons for falling into recession in the first half of this year.

Munich’s prestigious Ifo Institute, a center for economic research, issued a report in May saying that the effects of economic sanctions against Russia have not had the “political effect they were looking for” by the powers that imposed the sanctions, although they have. It does not mean that they are worthless and “left” against Putin.

Experts and politicians who defend the appropriateness of these measures against the Russian regime point out that if its economy continues to grow, despite the war and unprecedented international repression, it is largely due to the military-industrial complex that the Kremlin keeps in full swing. performance because India and China are import substitutes to the West.

Source: El Diario





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