7 April 2022

Sanctions are no good while Germany still buys Russian energy

By

There have been few spectacles more nauseating in recent years than the self-congratulatory complacency of Western leaders in response to Ukraine. And with German Chancellor Olaf Scholz due in London tomorrow, we are going to witness this again in bucketloads.

It is certainly true that the imposition of sanctions – unquestionably the right thing to do – was swift, and overall their reach and scope has been serious. And as their efficacy has been analysed in the days after imposition, loopholes are being ironed out and targets widened.

In isolation, they do indeed stand as the product of a more unified alliance of democracies than many thought likely or even possible a few weeks ago.

But the self-satisfaction of Western leaders when they trumpet their involvement in the imposition of sanctions is breathtaking in its cant. Because sanctions cannot be taken in isolation.

So long as Germany – the main culprit here – and others continue to purchase Russian energy, sanctions are no more than an irritant to Russia – a form of gesture politics that directly enables the murder of Ukrainians in cold blood.

Russia is predicted this year to have a current account surplus of over $200 billion. No wonder: since 24 February alone, the day Russia began its invasion of Ukraine, EU member states have handed over €35 billion to Russia to buy its energy. Every euro spent purchasing Russian energy is a euro spent funding Russia’s invasion and subsidising the costs of murdering Ukrainians.

Ah, say the Germans, unfortunately we need Russian energy supplies; 34% of our crude oil comes from Russia, and 53% of the hard coal used by our power generators and steelmakers is Russian. And it’s not just us – Russia supplies more than a third of Europe’s gas. We all need it, and if we stop using it costs everywhere will be even higher than now.

One thing the Germans are not is stupid. They know exactly what they are doing. So they have decided simply to ignore the connection that it is Germany’s addiction to Russian supplies that has empowered Putin to butcher Syrians, to invade Crimea in 2014 and to entrench himself in Russia.

There are two key issues here.

The first is practical and is straightforward. So long as Europe keeps buying Russian energy, we might as well all send emails to the Kremlin saying, ‘Go right ahead and do as you will with Ukraine, because you can treat everything we say as hot air’.

The second issue is moral – because that practical decision to keep buying Russian energy is a moral outrage. Germany et al are funding Russia’s war crimes. As today’s issue of Die Welt puts it, Germany must share ‘guilt for the massacres in Bucha and Mariupol’.

The calculation being made in Berlin is simple and repellent. On one side is the cost to the German economy (and the knock-on effects elsewhere) of suddenly spurning Russian energy. On the other is the commission of war crimes by Russian forces in Ukraine. And the Germans have decided that not taking a hit to their GDP is more important than acting to stop Russia murdering Ukrainians.

It is less cynicism than cold-blooded immorality.

According to the writer Jeremy Cliffe in The New Statesman, ‘an embargo by Germany would be economically ‘manageable’ for Berlin, costing a short-term hit to GDP of between 0.5 and 3% (between about €100 and €1,000 per capita)’. Analysts also suggest that Germany now has enough gas supplies to last until November, so there is some time to explore alternative sources (the Americans, for example, have floated sending over liquefied natural gas).

As Cliffe puts it: ‘Significantly reducing Russia’s ability to wage genocidal war at a cost to the average German of a mid-range holiday? It should not be a difficult decision. Yet at the time of writing the federal government deems it a step too far’.

When Chancellor Scholz arrives in No 10 tomorrow, Boris Johnson should be blunt. The PM deserves great praise for his leadership on sanctions. But those sanctions are as nothing while Germany still buys Russian energy. He should tell Chancellor Scholz that he has an hour to commit to boycotting Russian energy – and if he refuses, the Prime Minister should call him out at their press conference, labelling him as Putin’s enabler.

He won’t do that, of course. But really, he should.

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Stephen Pollard is Editor-at-large of the Jewish Chronicle.

Columns are the author's own opinion and do not necessarily reflect the views of CapX.