OPINION: The poisoning of Russia’s chief opposition leader Alexei Navalny, followed by the Polish antimonopoly regulator’s ruling against the Nord Stream 2 pipeline project, is pushing Germany towards a difficult decision.
Despite being a member of both the European Union and Nato, Germany has a history of going its own way when it comes to business with Moscow.
In the early 1970s, German manufacturers supplied equipment for Soviet gas export pipelines, despite US opposition and the Kremlin’s crackdown on protests in Eastern Europe. Today, Germany is going against the grain once more, reportedly excluding the Gazprom-led Nord Stream 2 project from proposed sanctions against Russia.
Such measures will not trouble Moscow, as they do not affect the economic interests of major corporations run by allies of President Vladimir Putin.
What concerns Moscow is the US sanctions that brought Nord Stream 2 to an abrupt halt last December. The US has repeatedly shown what it takes to hurt the Kremlin and, moreover, now has a powerful ally in its bid to stop the project — Germany’s neighbour Poland.
Last week, Poland’s antimonopoly regulator UOKiK imposed fines on five European companies that decided to lend over $1 billion each to Nord Stream 2 in anticipation of gaining minority stakes in the project. It also slammed a $7.6 billion penalty on Gazprom.
UOKiK has given 30 days for the companies — including Germany’s Wintershall Dea and Uniper — to cancel the lending agreements. Uniper has already hinted that it sees difficulties in getting back its loan in the event Nord Stream 2 is cancelled.
There is no doubt Chancellor Angela Merkel is showing awareness of the concerns of German companies involved in the project.
However, this may prompt Gazprom to seek German political support in overturning the Polish ruling against Nord Stream 2, thus putting EU antimonopoly regulations under attack.
If Germany continues to back Nord Stream 2, it will only increase division among EU members and the US.
In such a scenario, the only winner will be Russia.
(This is an upstream opinion article.)