February 21. 2024. 7:26

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German state governor under pressure over Nord Stream 2 revelations

German socialist writer Bertolt Brecht joked once that robbing a bank is nothing compared to founding one. Some are reminded of that logic in the never-ending drama on the Nord Stream 2 gas pipelines.

Five months after they exploded beneath the Baltic Sea, ongoing mystery over the perpetrator has been overshadowed by revelations about the dubious means employed by German politicians to get the pipelines finished.

As Brecht might put it: what’s blowing up a state-controlled Russian pipeline compared to building one?

Fighting for her political life is Manuela Schwesig. Once praised as a potential leader of the Social Democratic Party (SPD), the 48-year-old’s future as governor of the northeast state of Mecklenburg-Vorpommern hangs on an investigation into claims she was a puppet for Russian energy interests.

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German state governor under pressure over Nord Stream 2 revelations


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The lively tale has lifted the lid, too, on the extent of Russian influence, ahead of its invasion of Ukraine, in Germany: on Berlin energy policy, on the centre-left SPD and, in particular, the SPD-controlled northeastern federal state, anxious to book its ticket to gas-fuelled prosperity.

The Nord Stream 2 pipeline, controlled by Russia’s state-owned Gazprom energy giant, was approved by then chancellor Angela Merkel in 2014. Part of a new infrastructure to increase Russian gas deliveries to Germany, already more than half the annual total, the pipeline was nearing completion in 2020 when US politicians threatened “crushing legal and economic sanctions” if local German companies continued working on the project.

Chancellor Angela Merkel lobbied in Washington on behalf of the consortium and insisted, like her successor Olaf Scholz, that the pipeline was a private-sector project.

The Nord Stream consortium building the pipeline, with a board headed by ex-chancellor Gerhard Schröder, began devising ideas to circumvent the sanctions and finish the pipeline.

A key figure was Matthias Warnig, managing director of Nord Stream AG and a former East German spy.

In January 2021 the Mecklenburg-Vorpommern state parliament – and Schwesig’s government – signed off on plans for a state-controlled “Foundation for the Protection of the Climate and Environment”.

Apart from tree-planting projects with schools, most of the estimated €165 million of Russian money funnelled through the foundation was to complete the pipeline.

Headed by Schwesig’s predecessor as governor, Edwin Sellering, the foundation bought and stored building materials, leased construction ships and port space, and assisted about 80 companies to finish the job.

Behind the scenes, Nord Stream was pulling the strings: it dictated the foundation statutes, decided on communication strategy. Recently-released documents show the foundation was required to consult with Nord Stream on all large construction and delivery contracts.

As a state structure, regional leaders gambled that their foundation would be immune to US sanctions. The gamble paid off: construction continued and the pipeline was finished in January 2021.

But it never went into operation: two days before Russia invaded Ukraine, as the final regulatory paperwork was being completed, Scholz suspended the pipeline indefinitely.

A month later, Schwesig insisted she had done nothing wrong. Like most German politicians she said she had backed the wrong horse on energy, but claimed that – along with Merkel – she was now being scapegoated by others.

“With today’s knowledge the support for Nord Stream 2 and the foundation was a mistake,” she said in March 2022. “And I made these mistakes.”

Instead of going away, a constant flow of new documents and revelations – including lucrative foundation contracts for close political allies – means matters are coming to a head for Schwesig.

The latest twist involves a missing tax return on a €20 million gift from Nord Stream to the foundation which a state tax official admits burning in her office fireplace.

Opposition politicians say a small network of political allies and the steady flow of documents show the climate foundation was “linked even closer to Moscow than it seemed”.

“Without Kremlin approval, no bigger decisions could be taken,” said Franz Robert Liskow, state parliament leader for the opposition Christian Democratic Union (CDU).

His party colleague Sebastian Ehlers, head of a state parliamentary inquiry into the affair, has demanded intervention from Olaf Scholz in Berlin: “It’s time the chancellor drained Schwesig’s Russian swamp.”