Despite the vise grip of Western sanctions on Moscow, German and Russian businesses could be getting cozy once again.
Trade between the two countries increased by 37 percent to €10 billion in January and February compared to the previous year, according to the East Committee of the German Economy. According to chairman Wolfgang Büchele, German businesses are looking optimistically eastwards again.
“The sanctions were, as is generally known, only partly responsible for the recession in Russia,” Mr. Büchele told Handelsblatt.
Mr. Büchele, who is also CEO at M+W Group, an engineering and high-tech facilities firm, pointed out that Russia’s recession was more largely due to the sharp drop in oil prices and substantial depreciation of the rouble. Now that both fronts seems to be picking up again, Russia has greater purchasing power and is getting more imports.
Moscow’s recovery looks to also be bolstered by a scheduled Tuesday meeting between German Chancellor Angela Merkel and President Vladimir Putin at his Black Sea residence in Sochi. Officially, talks will focus on preparations for July’s G20 summit in Hamburg, but are likely to also touch on economic issues and conflicts in Syria and Ukraine.
Mr. Büchele said that German business is hoping the visit will be “the beginning of intensive dialogue once more.”
“It is time to reactivate suspended bilateral and European dialogue with Russia,” he explained. “Permanent confrontation will cost us dearly in Europe. Both sides need each other in order to solve fundamental European and global political questions,” he added.
Russia’s finance minister Anton Siluanov said he is not expecting Western sanctions to be lifted anytime soon, in an interview with Handelsblatt, but said Moscow is still keen on wooing foreign investment nonetheless.
Mathias Brüggmann is Handelsblatt’s international correspondent. To contact the author: email@example.com