Renewed Russian Interest in Upgraded Industrial Cooperation with Europe

October 29, 2009 (LPAC)—The Russian government has launched initiatives to expand cooperation and to have the Europeans, especially Italy and Germany, increase direct industrial investments in Russia.

At the end of last week, Putin, Medvedev, and Italy's Berlusconi discussed the South Stream gas pipeline project. Concerning Germany, Putin made a special point about industrial cooperation when, on Oct. 18, he visited the new Kaluga auto plant of Volkswagen and Skoda (the Czech daughter of VW). Then, on Oct. 19, he joined a meeting between Medvedev and top leaders of German industry who were visiting Moscow, which has received little media coverage. Klaus Mangold, chairman of the German industry's Ostausschuss (East Committee), is quoted saying that the managers attending the meeting represented a total annual turnover of 500 billion euros, and that the meeting included only firms that are committed to "longer-term, sustainable engagement" in Russia. Mangold added that "links are long term and on a scale beyond anything being done in the U.K., France, the U.S. or Italy."

Putin mentioned agriculture, construction, car-making and high techhology as sectors of preferred interest, and he added that a number of new "big projects will preserve existing jobs and create new ones in Russia and in Germany." This includes the envisaged Magna-Sberbank-Opel group, and the recent Russian purchase of the Vadan shipyard in Wismar, among other projects.

Among high-tech ventures, the one which is planned between Siemens and Rosatom for the joint manufacturing of nuclear power plant components ranks prominently, and was referred to on the sidelines of that Moscow meeting. The London Financial Times noted: "Rapidly growing ties with Russia are giving German industry prime position in a market of 140 million people—encouraged by a Berlin eager to save jobs." The FT added: "In the East Committee of German Business, Germany also boasts the western world's most vocal, best-connected and most unashamedly pro-Russian lobby group. In addition to its political work, the committee trains Russian engineers and managers, and supports youth exchange programs."