German government, businesses come forward in support of Nord Stream 2

A logo of the Russian multinational energy corporation Gazprom fixed in front of Moscow office building of the company in Moscow, Russia, 03 January 2021. [EPA-EFE/MAXIM SHIPENKOV]

The German government said it will not abandon the Nord Stream 2 project, despite US sanctions and calls by the European Parliament to impose EU measures against the Russian-backed gas pipeline project over the Navalny case.

“There is no direct connection between the Navalny case and Nord Stream 2,” government spokesman Steffen Seibert said in Berlin on Monday (25 January), adding that the attitude of the government to the project has not changed.

Berlin condemns “the harsh, disproportionate actions of the Russian security forces against peaceful demonstrators” and continues to demand the “immediate” investigation of the chemical weapons attack on Alexei Navalny, Seibert added.

The German government “took note of” the European Parliament’s resolution demanding the suspension of Nord Stream 2, but this has “not changed” its position regarding the pipeline project, Seibert said.

Despite US sanctions against companies involved in the construction of the pipeline, German Chancellor Angela Merkel said last week she would not abandon the project and will discuss it with the new Biden administration.

The new leader of Germany’s ruling Christian Democrats, Armin Laschet, said on Monday he would not reconsider his support for the Russian-backed pipeline, despite US and European opposition to its completion.

Laschet, whose election as CDU leader this month places him in pole position to succeed Merkel as chancellor, urged Russia to release Kremlin critic Alexei Navalny. But when pressed on domestic energy supply, he said “Germany decides”.

Asked if he would be prepared to think again about the pipeline, Laschet replied: “No.” Germany and Russia, he added, have maintained academic and business ties even at the height of the Cold War.

The pipeline is creating a headache for the German Social Democrats too as it will touch down on German soil in the state of Mecklenburg-Western Pommerania, which is governed by Manuela Schwesig (SPD).

Her local government established the “Foundation for Climate and Environment protection“, which has been stacked with €200,000, with an added €60 million donated from Nord Stream 2 AG, owned by Gazprom.

Besides supporting environmental projects, the foundation was also set up to counteract the announced US sanctions against Nord Stream 2. The foundation shall “enable the continued construction of Nord Stream 2, should this be necessary after talks between the government and the new US administration,” according to a statement on the website of Schwesig’s local SPD.

German Greens took offence at what they called “greenwashing”, while anti-Russia hawks in the liberal FDP party have condemned the foundation as a vehicle for the Kremlin’s geopolitical interests. Environmental NGOs refused a seat on the foundation’s board.

Parliament calls to block the pipeline

Meanwhile, EU lawmakers passed a resolution on Thursday (21 January) calling on the EU to block the completion of Nord Stream 2 in response to the arrest of Russian opposition leader Alexei Navalny.

“Sanctions are there to induce a government to behave in a certain way. So it’s about leverage and our possibilities of influencing the government in Moscow, regardless of the content,” said MEP Sergey Lagodinsky (Greens), who helped draft the resolution.

According to its proponents, Nord Stream 2 will bring “money and stability”, but only “at the expense of human rights, solidarity with neighbouring states and transparency,” he told EURACTIV.

In view of the ongoing tensions with Russia, businesses must be aware of the risk, added MEP Michael Gahler, spokesman on foreign policy for the centre-right European People’s Party (EPP).

“Any company that gets involved with Russia needs to know that things can go wrong,” he said, rejecting the argument that Nord Stream 2 is necessary for security of supply in the EU.

“This pipeline is not necessary for the supply. We have many reference points for gas, including from countries that do not threaten us politically,” he told EURACTIV.

European companies withdraw from Nord Stream 2 gas pipeline

The Nord Stream 2 gas pipeline – which has received the green light from German authorities to restart construction work – is seeing a few companies withdraw from the project, including three this month alone.

For instance, the Zurich Insurance …

Business sticks with Nord Stream

Last week, the US administration followed up on its threats and announced first sanctions against the pipeline – so far, limited to one Russian construction ship.

Sources from German business circles told EURACTIV Germany that as of now, there is no concrete worry of negative economic impacts caused by the US sanctions.

“The decision on the pipeline construction was made many years ago. It is close to completion and received permits in accordance with principles of the rule of law,” said Svenja Schulze, Germany’s environment minister.

“If we stop the project now, we will inflict a great deal of harm, casting a doubt on reliability of decisions made on the basis of principles of the rule of law and would probably face court proceedings,” Schulze told Redaktionsnetzwerk Deutschland (RND).

German business groups tend to support that view. The US sanctions “put a strain on the restart of transatlantic relations” at a time when the new Biden administration offers hope for renewal, said Oliver Hermes, CEO of the Wilo Group and chairman of the German Eastern Business Association.

Regarding the political calls to halt the project, he insisted that “investment safety is a crucial achievement of the single market and should not be questioned,” pointing towards the various European companies who invested into North Stream 2.

Nord Stream 2 is “a step in the right direction for Europe” in order to guarantee energy supply in the long term, added Ludwig Möhring, from the German Federal Association for Natural Gas, Petroleum and Geoenergy (BVEC).

“We need it due to the declining natural gas production in Western Europe,” Möhring told EURACTIV, not because it is being forced on Europeans.

Möhring rejected the notion that the new pipeline will make Europe more dependent on Russia.

“The pipeline does not mean that we will no longer have a choice in the future, but only that we will secure our supply at competitive prices in the long term,” Möhring told EURACTIV.

Calls to stop the project will ultimately not help the EU, Möhring said.

Even though the relationship between the EU and Russia is going through “difficult times”, “Europe and Russia have an interest in living in a good neighbourhood in the long term.”

Nord Stream 2: Europe stays quiet while US 'tramples over EU sovereignty'

With the recent adoption of its defence budget for 2021, the US has further tightened the screw on Nord Stream 2, threatening sanctions on EU companies involved in the Russian-backed pipeline and putting the future of the project further into uncertainty. EURACTIV France reports.

[Edited by Frédéric Simon]

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