Corporate Germany’s deep Russia ties

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Apr 13, 2022 View in browser   By Ryan Heath Check out the weekly Global Insider podcast.| Follow Ryan on Twitter. Pro tip: Nearly everyone's leaving Davos by Thursday morning of this year's World Economic Forum Annual Meeting, in May. Don't get stuck there alone! Happening Today Australia, Britain and the United States have asked Japan to join their AUKUS security pact, Sankei newspaper reported. Does that make it JAUKUS? GERMANY PLAYED RUSSIAN ROULETTE AND LOST Global audiences now know that Germany relies heavily on Russian energy. But did you know about the "decades of entanglement between German business and Russian politics," including "corporate Germany's role in fending off efforts to counter Russian aggression?" POLITICO's Matthew Karnitschnig and Nette Nöstlinger take a deep dive into this history of tapping markets to Europe's East to build Germany back to an economic powerhouse.   INTRODUCING DIGITAL FUTURE DAILY - OUR TECHNOLOGY NEWSLETTER, RE-IMAGINED:  Technology is always evolving, and our new tech-obsessed newsletter is too! Digital Future Daily unlocks the most important stories determining the future of technology, from Washington to Silicon Valley and innovation power centers around the world. Readers get an in-depth look at how the next wave of tech will reshape civic and political life, including activism, fundraising, lobbying and legislating. Go inside the minds of the biggest tech players, policymakers and regulators to learn how their decisions affect our lives. Don't miss out, subscribe today.     Ricardo Tomás Look East, and to Munich: Two centers of corporate Germany's efforts to keep economic links with Russia open, despite its Crimea invasion, atrocities in Syria and deadly targeting of domestic political opponents are a trade association known as the East Committee and the Munich Security Conference. High profile corporate supporters of both organizations include Siemens, Linde, BASF and Allianz and Deutsche Bank. After peaking at nearly $100 billion in 2012, German trade with Russia dropped to around $60 billion in 2016 due to Crimea invasion sanctions and China's efforts to boost manufacturing sales in Russia. NEW PODCAST EPISODE — PROSECUTING WAR CRIMES IS NEVER ENOUGH Listen to Global Insider podcast Prosecuting war crimes can take decades: But never before has so much evidence been in circulation so quickly, nor has it been contested with such velocity, as is happening in Ukraine today. Biden calls genocide: As U.S. President Joe Biden said for the first time that Moscow's invasion of Ukraine amounts to genocide, this week's podcast asks what if, instead of there being not enough evidence to prosecute, there is too much? How much of it can be used to deliver justice, and who will instead escape unpunished? And what evidence is being destroyed already by Russian forces? Who will draw the lines around those facing prosecution and those winning forgiveness? Linda Kinstler , a writer who studied how Soviets pioneered modern war crimes evidence collection in Ukraine in the 1940s — only for those lessons to tragically come full circle — said: "The Russian army is now perpetrating the very same crimes, which previous generations of Soviet officials documented. It's so sinister how the images match up." Decades of prosecutions: Kinstler tells Global Insider that prosecuting these crimes will take decades , and it will not be enough. "Everything is going to be contested. While the velocity of contestation is new, the fact of contestation is not new. The Nazis said: 'We didn't murder civilians, we just sent them to the doctor.'" You don't need all the evidence to make a conviction — the Soviets taught us that: "The vast majority of the evidence presented at Nuremberg had to do with crimes committed on the territory of Eastern Europe. It was not yet clear what had occurred in Western Europe and by what mechanisms. The minutes of the Wannsee Conference had not yet been discovered." But there's danger ahead for prosecutors : "Cellphone videos or audio recordings, things like that, are vulnerable to start with, but also, people — if they get to leave these besieged cities — are ordered to delete files from their phones, or just hand over their phones. We really do not know how much we are losing and how fast we're losing it." Prosecution isn't everything: Kinstler says the lack of global interest in Dutch attempts to prosecute those who shot down MH17 over Ukraine is a "huge warning for everyone" about how hard it is to deliver real justice. "We have to accept the fact that this (a trial) is one kind of reckoning, and it's not the ultimate, and it cannot be the only form of reckoning. One way of winning the war is by winning the narrative, especially because Russia insists on perverting it." Moral clarity: "Ukrainians have this moral clarity about what's going on. The kimono has been opened for them about what NATO and the EU and the U.N. really are" — places of occasional justice and endless promises that often turn out empty. Compensating victims of war crimes and rebuilding Ukraine: As Western governments study how to make Russia contribute to the cost of rebuilding Ukraine , which will run into the hundreds of billions of dollars, Kinstler says seized assets are a building block for such a strategy. "There's a lot of avenues. There's a lot of wealth that could be seized" via sanctions and related measures, and used for the settlement of claims. "One of the first things that President [Volodymyr] Zelenskyy called for was that Russia will pay reparations, they will pay for what they have done to Ukraine. But then what kind of reparations? How much? Who settles that question? There are many different ways diplomacy can step in here." Where are we on Ukraine chemical claims? The U.K. and U.S. continue to assess reports of Russian forces deploying chemical weapons in Mariupol. Ukraine's controversial Azov Battalion said three of its soldiers were showing signs of chemical poisoning after a Russian drone dropped an unknown substance. U.S. officials told POLITICO they have been running scenario-planning exercises on the possible use of chemical weapons. GLOBAL RISKS AND TRENDS FRENCH ELECTION Watch: French Election: 3 ways Emmanuel Macron could lose This piece from POLITICO's Maïa de La Baume shows where Jean-Luc Mélenchon's votes (22 percent of the total) might go, while Clea Caulcutt charts Marine Le Pen's possible road to victory. BEGGING BOWLS: If you're a French presidential candidate, you're spending this week begging for votes or begging for money. "The financial situation of my campaign is critical," Republican candidate Valérie Pécresse told reporters after bagging just 4.8 percent of votes. In failing to reach the 5 percent threshold, there will be no public money for her campaign. "I am personally indebted to the tune of €5 million." How the mighty tumble: Pécresse's Republican predecessors routinely used to make the presidential run-off, and more often than not, win it. Even the disastrous 2017 campaign of François Fillon garnered 20 percent of the vote. UKRAINE FRONTS HEADING FOR A MAJOR CONVENTIONAL WAR IN THE DONBAS: Russian President Vladimir Putin said on Tuesday peace talks with Ukraine had hit a dead end and vowed his troops would dig in and win. That means a long war in Donbas is now to be expected. "We have again returned to a dead-end situation for us," Putin said. RUSSIA'S WAR IS A SHORT-TERM WIN FOR COAL: Of all fuels, coal is the one the EY wants to cut first — when it comes to Russian supplies — by August. But that means the bloc will rely more heavily on its own supplies, rather than be able to eliminate coal from its energy mix. SWEDEN WINS THE NATO LOTTERY: Elisabeth Braw, senior fellow at the American Enterprise Institute, on why the militarily non-aligned Scandinavian country needs to seize its NATO chance — because Finland, which borders Russia, is willing to be Sweden's shield and is "sparing Sweden the trouble of having to break the ice." Compare that to "the dogged pushing, lobbying, begging, reforming, investing and training the Baltic states and every other post-Cold War NATO joiner had to undertake to be admitted." DIVERSIFYING ENERGY: Algeria will overtake Russia as Italy's largest gas supplier thanks to a deal struck by Italian Prime Minister Mario Draghi in the North African country on Monday. Under the agreement between Algeria's Sonatrach and Italy's Eni, Algeria will send an additional 9 billion cubic meters of gas to Italy in 2023-24. Visits by Draghi to Mozambique, Angola and the Congo in the next few weeks are under discussion, report POLITICO's Giorgio Leali and Hannah Roberts. UKRAINE SECRET SERVICES CAPTURE PRO-KREMLIN POLITICIAN AND PUTIN ALLY After weeks on the run, Viktor Medvedchuk, who had escaped house arrest, was back in handcuffs Tuesday. LIFE AND DEATH IN UKRAINE: The case for why NATO literally owes Ukraine air support: "Because if we hadn't given up these (nuclear) weapons, Putin wouldn't have invaded." More from Julia Ioffe. TAIWAN — WAR SURVIVAL HANDBOOK OVER CHINESE INVASION THREAT: The 28-page guide is the first official handbook advising civilians how to prepare for or respond to a Chinese invasion. The "National Defense Manual" details several survival tactics — including how to find bomb shelters via smartphone apps, locate supplies and prepare emergency first aid kits. UNITED KINGDOM — JOHNSON AND SUNAK BROKE LAW WITH COVID PARTIES: Finally. British police confirmed what we already knew: that Prime Minister Boris Johnson, his wife Carrie Johnson and finance minister Rishi Sunak breached Covid-19 laws in attending parties at Downing Street during the country's strict lockdowns, and will be fined. UNITED STATES — INFLATION, THE GOOD NEWS: Prices are skyrocketing, right? Even inflation at 8.5 percent contains silver linings. Underlying inflation (that is, excluding the two sectors subject to huge price spikes — food and energy) rose at an annual rate of 4 percent in March. That's cold comfort if you spend most of your budget on food and energy, but it's also a sign that this is not an out-of-control economy-wide contagion situation. Counter point 1: The Committee for a Responsible Fiscal Budget sees the glass half empty and has modeled inflation under various scenarios to remind you that we could still easily hit 10 percent inflation for 2022. Counter point 2: Even when agricultural prices boom it does not help rural America — Farms are ever more profitable, but employ fewer workers. UNITED NATIONS — Liechtenstein tables VETO INITIATIVE, TO CUT ACROSS SECURITY COUNCIL ABUSES: Tiny Liechtenstein, population 38,137, has tabled a resolution that mandates a meeting of the U.N. General Assembly whenever a veto is cast in the Security Council. Co-sponsored by 38 countries, "the resolution is a meaningful step to empower the GA and strengthen multilateralism," a government spokesperson said. METAVERSE — IT CAN'T WORK WITHOUT YOUR ENDLESS DATA: Right now, the "metaverse" that exists is a poor version of the real world. For it to really work, at least the 3D-goggles version that Mark Zuckerberg has been promoting , there will need to be sensors and microphones installed throughout homes, offices and public spaces — perhaps even "full body tracking" to replicate our every move and collect massive amounts of data to create digital twins of real-world environments, writes POLITICO's Mark Scott. Facebook whistleblower Frances Haugen doesn't trust her former employer to get it right, she told Scott.   DON'T MISS CONGRESS MINUTES: Need to follow the action on Capitol Hill blow-by-blow? Check out Minutes, POLITICO's new platform that delivers the latest exclusives, twists and much more in real time. Get it on your desktop or download the POLITICO mobile app for iOS or Android. CHECK OUT CONGRESS MINUTES HERE.     SUPPLY CHAINS CORNER  MANCHIN URGES CANADA TO "MAN UP" ON ENERGY: Sen. Joe Manchin (D-W.Va.) used a visit to Alberta on Tuesday to urge an overhaul to energy supply chains. A spokesperson for Manchin told POLITICO the point was not to rally for the Keystone XL pipeline, but to promote North American oil and gas, which he called the "cleanest" in the world. "So if you want to help the climate — use North American resources," he said, also meaning critical minerals that democracies are now often reliant on China for. CLASH OVER EU GREEN FASHION RULES: The owner of luxury brands Yves Saint Laurent, Gucci and Balenciaga, the fashion house Kering, is on board with making the textiles industry more sustainable — as long as brands can decide for themselves how to make that happen. But Brussels has other plans: It wants to set out stricter rules for how products, including textiles, are produced and consumed in a bid to slash related emissions and their impact on the environment. Last year, textiles consumption in Europe had on average the fourth-highest impact on the environment and climate change. Regulations targeting textiles should be about setting out a "framework and a strategic point of view" within which companies can work to reach green goals, rather than setting mandatory requirements, Marie-Claire Daveu, the company's chief sustainability officer, told POLITICO's Leonie Cater. MAKING BETTER USE OF TRADE TECH: The newest generations of advanced technologies — from artificial intelligence to blockchain — can be applied to making trade quicker and cheaper, the World Trade Organization and World Economic Forum have said in a new report. "Unseized opportunities remain in connectivity, data sharing and e-signatures," the WTO said in a statement. Thanks to editor Ben Pauker, John Yearwood, producer Hannah Farrow, Nick Taylor-Vaisey and all the POLITICO reporters working across eight countries who are reporting on the Russian war in Ukraine.    Follow us on Twitter Ryan Heath @PoliticoRyan   Follow us

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