Putin's Pal

The Most Important Foreigner in Russia

Putin pays better than the Stasi. Source: DPA
Putin's best pal.
  • Why it matters

    Why it matters

    A former Stasi agent is one of the most powerful businessmen in Russia.

  • Facts

    Facts

    • In 1986 the East German Stasi sent Mr. Warnig to Düsseldorf to spy on West German companies.
    • In 1991 Mr. Warnig was sent by the Dresdner Bank to St. Petersburg, where he got to know Mr. Putin and the two of them became friends.
    • In 2006 Mr. Warning became CEO of the Nord Stream pipeline company. The chairman of the shareholders’ committee is former German Chancellor Gerhard Schröder.
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    Audio

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Matthias Warnig doesn’t like talking to journalists. The managing director of Nord Stream, the international consortium controlling a gigantic pipeline pumping Russian gas to Germany along the Baltic Sea floor, would actually prefer to never see his name in the news.

But there is a photo, shot on April 28 this year in St. Petersburg. Shot in front of the grand Yusupov Palace at a late hour, it shows Russian President Vladimir Putin and former German Chancellor Gerhard Schröder embracing. It was taken during the peak of the crisis in Ukraine, just a couple of weeks after the Russian annexation of Crimea. There was outrage in Berlin’s political circles.

On the left-hand edge of this photo is Mr. Warnig, the German host who no one in Germany knows. Smiling, his gaze rests on the two powerful men. Nord Stream had hosted a reception following a supervisory board meeting, as a belated celebration of the former chancellor’s 70th birthday.

Matthias Warnig, born in 1955 in the Lower Lusatia region southeast of Berlin, was 18 years old and a convinced Communist when he joined the East German secret police known as the Stasi. They allowed him to study at university in East Berlin and later sent him to Düsseldorf, where he was officially part of the East Germany’s trade mission, but his real job was industrial espionage. Shortly after he returned to Stasi headquarters in East Berlin in 1989, the Berlin Wall fell.

For Mr. Warnig, and for Vladimir Putin, who was a KGB agent stationed at the time in the East German city of Dresden, a world collapsed with the Iron Curtain. But both were spectacularly successful in getting their bearings in new social and economic order.

After the fall of the Berlin Wall, Mr. Warnig took a job in May 1990 at Dresdner Bank, which wanted to expand into the East. The bank sent him to St. Petersburg, where he was supposed to open the first branch in what would soon be post-Soviet Russia.

Mr. Putin was also in St. Petersburg at the time, where he had become deputy mayor, responsible for the city’s external relations. Each company that wanted to establish a presence in St. Petersburg had to get the necessary license from him. Mr. Warnig received this license from Mr. Putin, which allowed him to open the first Dresdner Bank branch there in July 1993.

It was the beginning of a close friendship. Mr. Putin invited the German manager to his dacha country home. They drank beer there, and talked about private and political topics. Their similar spy backgrounds created a bond, and mutual trust. When Mr. Warnig’s family followed him to Russia, the two men’s wives also became friends and their children even played together.

In 1993, Mr. Putin’s wife Lyudmila was badly injured in a car accident. Dresdner Bank had her flown out to Germany, where she was treated in a special clinic. During that time, Mr. Warnig’s wife, Bärbel, took care of Mr. Putin’s daughter. The Russian leader would never forget this favor. When Mr. Putin moved to Moscow and became prime minister and in 2000 moved into the Kremlin as president, Mr. Warnig’s fortunes rose with him.

No other foreigner comes close to approaching Mr. Warnig's power and access in Russia.

The big career leap for Mr. Warnig came when the plans to construct a Russian-German gas pipeline materialized. Klaus Mangold, at the time a member of the management board of Daimler and the chairman of a German-Eastern Europe business group, describes how Mr. Putin made a recommendation to the German chancellor: “We sat at a table in the President Hotel in Moscow, at a German-Russian business meeting, Mr. Putin, Mr. Schröder, some representatives of the German and Russian businesses, and me. The topic being discussed was Nord Stream, and the question of who could manage such a business. And then Mr. Putin said there was one person he would trust with that: Matthias Warnig.”

The Baltic Sea project was extremely sensitive, both ecologically and politically, making the recognition Mr. Warnig received that much greater when the gas began flowing to Germany on schedule.

“He did that brilliantly,” said Mr. Mangold.

From that point on, things progressed at breathtaking speed for Mr. Warnig. No other foreigner even approaches such power in Russia. He sits on the supervisory boards of two of the most important Russian banks, the Bank Rossiya and the Bank VTB. He belongs to the supervisory board of the energy company Rosneft and the oil pipeline company Transneft. He is the chairman of the board of directors of the aluminum producer Rusal.

For Gazprom he sits on the supervisory board of the Leipzig gas transmission company, Verbundnetz Gas. He is the chairman of the board of directors of Gazprom Switzerland. And, of course, since March 1, 2006 he has been the chief executive of Nord Stream. Mr. Warnig supervises the most important companies in Russia’s energy industry and financial world. He must now take care during votes on the committees that he doesn’t run afoul of a conflict of interest.

 

Gerd giving Vlad a hug as Mats looks on from the left. Source: DPA
Gerd giving Vlad a hug as Mr. Warnig looks on from the left. Source: DPA

 

He “is the most important German that we have in Russia,” said Henning Voscherau, the former mayor of Hamburg. But in Germany he is unknown. And at the party in St. Petersburg where Mr. Warnig was the host, but Mr. Voscherau said: “He remained in the background and gave no speech.” Mr. Mangold said simply: “He is shy.” But he is also considered discreet, reliable, and loyal. “He is absolutely tight-lipped,” said Mr. Voscherau. They are all qualities that Mr. Putin values in him. And which has also secured the trust of Gerhard Schröder.

The former chancellor said he “knows and values the work of Mr. Warnig, who contributed substantially to the realization of this great international infrastructure project.” Mr. Warnig is also considered competent, assertive, and is capable of understanding the Russian mentality.

That has not gone unnoticed by the Americans. Mr. Warnig is invited about once a year to Washington. There he is involved in discussions in the State and Energy Departments, at the National Security Council and in the U.S. Congress.

Next year Matthias Warning will turn 60. He has indicated that he wanted to leave Nord Stream management on December 31. This past summer he already would have liked to give up some of his posts. But then came the Ukraine crisis. Western sanctions also are hanging over Bank Rossiya and Bank VTB. So Mr. Warnig is continuing with his duties for the time being. This is likely because Mr. Putin wishes him to do so. The Kremlin probably thinks that when the crisis subsides, then Mr. Warnig can turn his attentions toward other tasks for the Russian economy.

He is already spending a lot of time in his house in the town of Staufen, in the southwestern German state of Baden-Württemberg, where he lives with his second wife, a Russian, and their two children. In July, he became a father again. But the busy Mr. Warnig is, of course, also working in Staufen. He has formed a real estate and financial consulting business and is involved with another real estate company in Zürich.

 

This article first appeared in Die Zeit. To contact the author: Matthias.Nass@zeit.de

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