Dusseldorf In view of the war in Ukraine, Ifo President Clemens Fuest advocates a thorough analysis of German foreign trade relations from a geopolitical perspective. However, he warns politicians against overly hectic conclusions in the current situation and cites the following example: “Never trading with Russia again is strategically complete nonsense,” says Fuest in the new episode of “Handelsblatt Today”.
When it comes to energy, the strategically correct solution for the time after the Ukraine war is to build up alternative gas supply sources in order to be able to stop gas imports from Russia at any time. However, if cheap gas imports from Russia are possible, Fuest believes that they should continue.
“Russia will sell its gas anyway and it’s better if Russia is dependent on us – and dependent on us,” says Fuest. You have to be able to become independent relatively quickly, “but it is unwise to stop trade altogether and to North Koreanize Russia, because that would mean that Russia is no longer dependent on the West either.”
According to the Ifo President, Germany is becoming less attractive as an investment location for energy-intensive industries: “Until recently, we still had the locational advantage of cheap gas supplies from Russia and there was a chance that Nord Stream 2 would make it even cheaper. The issue is now settled .”
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In order to secure future growth, it is important to regulate the future of energy supply in Germany. “We need an energy policy that is coordinated at European level,” says Fuest. And: “We have to see that we open up other markets and prepare for the fact that the growth in trade with China will tend to slow down, even if China does not now side with Russia.”
Because China will monitor the situation and in future think more geopolitically on trade issues, “i.e. make itself more independent of the West”. All of this is not good news for Germany.
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