„It is up to Russia to resume their contractual obligations“

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Interview with the Federal Chancellor „It is up to Russia to resume their contractual obligations“

By delivering the gas turbine Prime Minister Trudeau took a strong decision that reinforced Germany’s and Europe’s position and helped to call Putin’s bluff, said Federal Chancellor Olaf Scholz in an interview with the Canadian newspaper The Globe and Mail. He also explained, how Canada and Germany would strengthen their energy partnership.

7 min reading time

Federal Chancellor Olaf Scholz

Federal Chancellor Olaf Scholz: “Ukrainians are being trained on new and more sophisticated equipment in several locations in Germany. And we will continue to provide this support to Ukraine as long as it takes.“

Photo: Bundesregierung/Kugler

Why did Germany believe it was necessary for Canada to break its own sanctions against Russia and provide a two-year reprieve to allow Gazprom turbines to be repaired at Siemens Energy’s Montreal plant?  

The sanctions have one goal: Impose economic costs on Russia. Checking our sanctions against this goal is really important. And with the gas turbine, the question was: Who pays the cost if the turbine is not delivered? Russia is using the turbine as a pretext to reduce the delivery of gas. So Prime Minister Trudeau took a strong decision that reinforced Germany’s and Europe’s position. He took away that pretext.

And beyond that: Our sanctions remain in place. They are working. Russian productive capabilities are falling rapidly, its economy is in recession and its access to critical goods has been severely reduced.

Germany could have got supplies of natural gas from the Gazprom pipeline that runs through Ukraine. Why did Germany not avail itself of this option?

Let's be careful not to step into Putin’s trap! Why would Russia deliver more gas through Ukraine? I don’t believe this would have happened. With the delivery of the turbine, we called Putin's bluff. He cannot use this pretext anymore and cite technical reasons for declining gas deliveries. It is a well-known playbook by now: Russia wanted to stop gas deliveries and blame our sanctions regime for the result. We are seeing this in several fields. Russia is also blocking Ukrainian grain exports and blames Ukraine and the sanctions for the chaos in food markets worldwide.

Why did Germany not realize that it was foolhardy to be dependent on Russian natural gas when the United States kept telling you that authoritarian regimes, such as Putin’s, cannot be trusted to supply energy needs?

Germany as many others in Europe has been buying gas from Russia for decades. The supply was reliable even in the coldest times of the Cold War. Beyond that – don’t forget the bigger picture: Germany was not the only country that in the past worked hard to build a different future with Russia: Russia was member of the G8, the Russian president was invited to the NATO summit in Lisbon, NATO-Russia relations were on path for a strategic partnership. There was sincere hope that we could put past confrontation behind us.

But still: I don’t want to deny that we have relied too long and too single-sidedly on energy supplies from Russia. Today we live in a different reality and we are quickly adjusting. We stopped coal imports from Russia, we will end oil imports by the end of this year. Gas is the toughest part, but the share of Russian gas in our imports has fallen rapidly, in only a few months from 55 percent to 30 percent. More steps will follow. In this context, we would welcome LNG supplies also from Canada.

Why has Germany reduced its military support for Ukraine despite promises to the contrary?

That is simply not true! Let us stick to the facts: Starting from the first days after Russia attacked Ukraine, we have delivered weapons and ammunitions to Ukraine. This is a complete turn-around from the iron-clad policy of all Federal German governments – no arms exports into crisis areas. We delivered whatever we had: anti-tank and anti-aircraft systems, mines, guns, tons of ammunition and non-lethal aid. Since then we have moved to more complex and high-value systems. Self-propelled howitzers, Multiple Launch Rocket Systems, anti-aircraft systems, counter battery radar. Some of these systems are so new that only very few have been produced and some of them have not even been introduced in the Bundeswehr. All of those need training for the Ukrainian crews and we are providing that as well. As we speak, Ukrainians are being trained on new and more sophisticated equipment in several locations in Germany. And we will continue to provide this support to Ukraine as long as it takes.

Canada’s opposition parties, which voted to hold hearing into the matter, say Prime Minister Justin Trudeau was played for a fool after Gazprom told European customers it cannot guarantee gas supplies because of “extraordinary” circumstances. Was Mr. Trudeau and Germany played for fools by Russian President Vladimir Putin?

Quite the contrary! As I said: thanks to Prime Minister Trudeau we were able to call Putin’s bluff! We never believed that the reduced deliveries had technical reasons. Russia is trying to exert pressure and to pit one ally against the other - we should not allow him to succeed. With the turbine ready to be delivered, it is up to Russia to resume their contractual obligations.

Will your ambassador agree to testify before the parliamentary committee?

Yes, Ambassador Sparwasser has agreed to speak in front of the committee.

The Prime Minister has angered President Zelensky and the Canadian Ukrainian Canadian community by providing sanction relief to Gazprom. The World Ukrainian Congress is even taking the Canadian government to court over the decision. What do you say to President Zelensky and Canada’s Ukrainian Canadian community who say that Mr. Trudeau caved to Russian blackmail? 

There is certainly no relieve for Russia. Sanctions against Russia are becoming tougher and tougher and Canada within the G7 is playing a pivotal role in shaping our support for Kiev. Today, we are targeting additional sectors and closing loopholes. I consider the criticism against Justin Trudeau and his government as utterly baseless. The decision to deliver the turbine is hardly a favour to Gazprom. It is a strong sign of support for Germany and for Europe and of maintaining solidarity amongst close allies in order to sustain long-term support for Ukraine. How would weakening Germany and Europe help Ukraine?

You are coming to Canada in August with a trade mission. Will Germany offer investment and technology to help build two liquified natural gas facilities on Canada’s east coast to help Germany become less reliant on Russian gas. How long would it take to get these facilities up and running if you are serious about looking for alternative gas supplies and do you have a commitment from Mr. Trudeau to speed up regulatory approval?

Canada would be a welcome energy partner for us. This goes beyond LNG, which is important now, but extends to hydrogen and critical minerals that are needed for battery production or wind turbines. And this partnership will need to be more complex than just minerals and basic energy resources. We want to have a reliable network of industrial cooperation that makes use of the advantages Canada and Germany have. The transition we need to accomplish is on scale for another industrial revolution. The climate crisis is daily reality, just look at the heat wave we currently have in Europe. LNG and its infrastructure are important now, but they need to be future ready.

Is Germany prepared to line up investors in Canadian mines that extract critical minerals to reduce your country’s dependence on China?

Like I said: This goes beyond just critical minerals and needs to include refining and industrial value chains and networks. The tasks ahead in addressing industrial transition are vast. I am looking ahead to meeting Prime Minister Trudeau in a few weeks and discuss all of these topics together with industry representatives. We need concrete steps now, and I think it makes a lot of sense economically for both our countries.

When it’s all boiled down, is the main reason Canada was asked to repair and export the Russian turbines because it eliminates an excuse Russia could use to deny Germany/Europe gas?

Yes, with the turbine ready to be delivered we have taken away Russia’s pretext to reduce or stop gas deliveries. If Moscow decides not to live up to its contractual obligations, then let this be crystal clear to the whole world. Thanks to Canada, this will now be the case.