Weaponizing Energy – Morning Briefing Plus

A few weeks ago I argued in an editorial that Germany – despite all the devastating consequences for the economy – may have to prepare for a boycott of Russian gas. The reactions to a few texts in recent weeks have been so controversial. Time and again reference was made to the fact that Russia had always kept its promises, even in the coldest days of the Cold War.

What an illusion. As of this week, we know that Vladimir Putin is ready to use energy as a weapon at any time. At least since Russia stopped gas deliveries to Poland and Bulgaria and threatened further delivery stops, it would be negligent not to prepare for a boycott scenario. Putin is willing to jeopardize the fate of the Russian economy at any cost.

Germany has meanwhile surprisingly given up its blockade of oil sanctions. Our Brussels office manager Moritz Koch learned in confidential background talks that the EU could therefore introduce further punitive measures as early as next week. The Commission is expected to submit a proposal to member states on Tuesday. If everything goes smoothly, the new package of sanctions, now the sixth, could be approved by the EU ambassadors on Wednesday.

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Different models are discussed: One possibility would be a phased introduction with longer transition periods to give member states time to adjust to an end to oil supplies from Russia. The Federal Government favors this approach and sees itself well prepared for it.

Another model would be the introduction of a price cap. The Europeans would tell the Russians that in future they would no longer pay the world market price for oil, but only a certain, significantly lower sum. However, there is a risk that Russian President Vladimir Putin will not put up with the European price dictate – and will stop deliveries: possibly not only of oil but also of gas.

What else kept us busy this week:

1. The Russian army is increasingly under pressure in Ukraine. After setbacks in the north of the country, the strategy of focusing on splitting off individual parts of Ukraine in the east is also not working. Or so says military analyst Jeffrey Edmonds, who served in the US Army for two decades and now works for the think tank CNA. The situation of the Russians is “much worse than most people realize,” he said in a very interesting interview with Katharina Kort. But he also says that the more Putin gets on the defensive, the more dangerous he becomes.

2. Germany is experiencing a green wave of start-ups. This is shown by the latest figures from a start-up monitor, which my colleague Larissa Holzki evaluated exclusively this week: According to this, founders and investors are increasingly relying on green technologies. Incidentally, most German start-ups – measured by the number of inhabitants – are not founded in Berlin, but in Starnberg.

3. Not long ago, many looked in amazement at China. Everything seemed to be going well there: Covid was under control, growth was in double digits – and the high-tech industry was thriving. But suddenly the country experiences a deep crisis. Growth is collapsing, people are resisting tough lockdowns and the situation is more unstable than it was during President Xi Jinping’s tenure. Our correspondent Dana Heide describes what all of this means for the future of the country.

Xi Jingping: China’s head of state and party wants to secure another term in office in the fall.

(Photo: Reuters, Getty, AP, Imago)

4. Usually only a few media people are interested in the fate of Twitter. That was different this week. Because Elon Musk wants to buy the short message service, which lost $ 128 million in the first quarter, for $ 44 billion. At the end of the week, the question remains: what does Musk actually intend to do with Twitter? Our US tech correspondents Felix Holtermann and Stephan Scheuer investigated this question and spoke to numerous investors, Twitter employees and competitors. Musk wants less ads, more paid subscriptions, and less censorship. Where does all this lead? Not clear. One thing is certain: never before has a single person mobilized so much money to buy a company.

5. 15 years ago I researched a long report about the most exciting German start-ups. I conducted more than 50 interviews for the cover story – but only three of them with women. There were simply too few female entrepreneurs, it was said again and again at the time, too few role models. That has changed radically, as the current weekend title of the Handelsblatt shows, in which we present the 50 best female entrepreneurs in Germany. They are inspiring role models from almost all sectors – right across the German economy. Is everything good now? Of course not. The proportion of women among company pioneers is only 17.7 percent. And among the 25 German unicorns there is exactly one female founder. But it’s a start, as these amazing role models prove.

6. Sun, shorts and Bitcoins: My colleague Astrid Dörner traveled to the Bahamas this week. There, crypto billionaires and Wall Street bankers met at a new conference to talk about the digital currency revolution and new investment opportunities. The “Crypto Bahamas” stands for nothing less than a major trend: never before have the traditional financial industry and the crypto scene been so close. This will change the financial world.

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7. Journalist colleagues reacted skeptically when the Handelsblatt reported in July 2020 where Wirecard Asia boss Jan Marsalek had fled: Moscow. While still in exile in Russia, the Austrian tried to steer his teetering corporate empire. When the billion dollar fraud in Aschheim was exposed, Marsalek fled to a villa in the posh Moscow suburb of Razdory. My colleagues René Bender, Mathias Brüggmann and Michael Verfürden report that the settlement is known for prominent residents, luxury properties and high security measures.

8th. I recently had a long, confidential chat with a high-ranking banker about real estate financing. Because of the rising interest rates, his institute is experiencing a real last-minute panic among customers: they are buying, he said, “the last dumps for moon prices”. A delicate situation. Because the price boom could end soon, as more and more studies show.

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9. Finally, I would like to recommend an essay by my colleague Frank Wiebe, who has dealt with the rise of right-wing movements. As Wiebe writes, they are almost always the result of being overwhelmed by new technologies, an increasingly complex world and modern societies. They lure with the promise of restoring a bygone era when everything was supposedly better. This is how they spread myths and conspiracy theories. What helps? Enlightenment and a fearless fight against lies. Incidentally, that is exactly what distinguishes good journalism.

I wish you a relaxing, but also thoughtful weekend.

It greets you cordially
Yours Sebastian Matthes

Editor-in-Chief of the Handelsblatt

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