Germany keeps proving that cowardice lies at the heart of its establishment

 Despite 18 months of war, the country can’t bring itself to upset the Kremlin

Source - Daily Telegraph 26/06/23

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Last month, G7 leaders gathered in Hiroshima, Japan, to deliver what appeared to be a hugely important message to Vladimir Putin and the rest of the Russian regime.

They wanted the Kremlin to know that the world’s seven wealthiest advanced nations stood together “against Russia’s illegal, unjustifiable, and unprovoked war of aggression against Ukraine”. More importantly, frozen Russian assets would “remain immobilized until Russia pays for the damage it has caused to Ukraine”, it said.

The question is what to do with these assets. The G7 communique seemed like confirmation of a plan that has been long in the making to ensure that Moscow foots the bill for rebuilding a country that it has left in ruins.

Special guest Volodymyr Zelensky had laid out in typically unflinching detail the devastation that Putin’s forces have inflicted on the eastern city of Bakhmut. “You have to understand that there is nothing. They’ve destroyed everything,” he said.

But once again efforts to punish Russia are being hampered by the cowardice at the heart of the German establishment.

Brussels envisages a modern day Marshall Plan, in which Russian central bank currency reserves languishing in the Western financial system as a result of sanctions become a key funding source for the massive reconstruction of Ukraine.

It is believed that G7 banks and financial institutions are currently withholding around $300bn (£240bn) of Russian central bank money, which would go a seriously long way towards piecing back together Ukraine.

Estimates from the World Bank, the European Commission and the United Nations, recently put the bill at $411bn – and that was before the destruction of the Kakhovka hydroelectric dam in southern Ukraine’s Kherson region unleashed biblical damage on the surrounding area.

The assets themselves are protected by state immunity under international law, but the European Commission has drawn up an ingenious proposal under which the profits that those currency reserves generate are put towards the reconstruction costs. And yet even that has been met with the same German resistance that has become all too familiar whenever Western allies have attempted to counter Russia’s aggression.

Concerns against the plan are being led, perhaps not unsurprisingly, by the European Central Bank, which just so happens to be based in Frankfurt. German government officials in Berlin have also joined the protest.

One foreign ministry official has been quoted by the Financial Times as insisting that Moscow “will have to pay for the damage it has caused in Ukraine” as well as swearing that Germany was doing “everything it legally can” to locate and freeze the assets of sanctioned Russian individuals and companies.

Yet others warn that the legal risks are too high. One official even suggested that if the EU took money from the Russian central bank or repatriated the profits, it could encourage Poland to pursue further reparation claims against Germany for damage during the second world war.

There has also been talk that it could weaken confidence in the euro and even jeopardise financial stability.

This is all a giant smokescreen from a German establishment that, having spent decades siding with Putin’s regime, still can’t bring itself to upset the Kremlin – even 18 months after the invasion of Ukraine, countless innocent lives and numerous war crimes later, and with whole Ukrainian cities reduced to rubble.

Germany has done more than any other Western power to prop up Putin’s gangster regime over the years. There’s an entire class of figures dubbed the Putinverstehers (Putin-whisperers) – those that mistakenly believed they could “tame Vladimir Putin with empathy”, as the Frankfurter Allgemeine Zeitung national newspaper once put it.

Then there is a whole grubby world of senior Westerners who have been perfectly content to shamelessly lobby on behalf of Russian interests, though few as prominent as Gerhard Schroder. The former chancellor has spent much of his time since leaving office in 2005 forging ever closer and more-lucrative ties with Russia’s energy industry and the Kremlin.

He even took senior posts with the companies behind the Nord Stream 1 and 2 natural-gas pipelines, having rubber-stamped the controversial gas link between Germany and Russia just two weeks before leaving office. Taking the easy option of becoming hooked on Russian gas was a terrible strategic decision that has left it beholden to Putin.

Angela Merkel can’t escape blame either. The policy of mercantilism and strategic pragmatism towards Moscow that Merkel championed during her time in office was desperately naive.

There were hopes that Oleg Scholz’s Left-wing coalition government might herald a break with the apologism that had characterised Berlin’s dealings with Moscow for several decades. But it has remained the weak link in the Western alliance from the outset of the war.

Berlin has dragged its feet – first by resisting sanctions, then when it came to giving weapons to the Ukrainian army. At every turn, it has thrown obstacles in the way of efforts to defeat Russia.

There’s a simple explanation for all of this: Germany has one eye on the end of the war and is terrified of upsetting a major trade partner. Ties between the two are longstanding and run deep. They were forged during the old Soviet Union then strengthened when the Berlin Wall came down, and trade between the pair runs into the tens of billions of euros every year.

Too many influential Germans with longstanding relationships in Russia want the hostility to go away, and for everything to be back to normal as quickly as possible. Shamefully, rather than wanting to do what is right, the German establishment seems more concerned with making money.