"Anti-Putin"
Alliance Fraying: Germany, Slovakia, Greece, Czech Republic Urge End To Russian
Sanctions
Tyler
Durden's pictureSubmitted by Tyler Durden on 08/16/2014 11:04 -0400
Czech
Germany Greece Italy Lehman Natural Gas Poland Recession Reserve Currency
Slovakia Trade War Ukraine
Last week
Germany reported that in the second quarter, its GDP declined by 0.2%, worse
than WALL STREET consensus. This happened a few shorts days after Italy
reported a second consecutive decline in its own GDP, becoming the first
Europen country to enter a triple-dip recession. What's worse, Europe's slowdown
took place before the brunt of RUSSIANsanctions hit. Surely in the third
quarter the GDP of Germany, a nation whose exports accounts for 41% of GDP,
will be even worse, with whisper numbers of -1% being thrown casually around,
but one thing is certain: Europe is about to enter its third recession since
the Lehman collapse just as we forecast at the end of 2013, a
"triple-dip" which may become an outright depression unless Draghi
injects a few trillion in credit money (which will do nothing but delay the
inevitable and make it that much worse once the can can no longer be kicked),
and unless normal TRADE ties with Russia are restored.
Which means
one thing: for Europe to resume the status quo, it needs to break away from the
"western" alliance and the sanctions imposed upon the Kremlin which
solely benefit the populist agenda of Washington, and certainly not Europe
proper, which it is now quite clear, is far more reliant on Russia than vice
versa. it is also something Putin apparently was aware of from the very
beginning.
And now,
that realization is starting to spread to Europe's own countries, which - while
the new cold war was only one of rhetoric were perfectly happy to go for the
ride - but now that TRADE war has finally broken out, suddenly increasingly
more want out.
As we
reported previously, it all started with the Greeks, a nation of heavy food
exports into Russia, who were the first to announce their displeasure with the
"Stop Putin" coalition:
the moment
Russia retaliated, the grand alliance started to crack. Enter Greece which has
hundreds of millions in food exports to Russia, and which was the first country
to hint that it may splinter from the western "pro-sanctions"
alliance. According to Bloomberg, earlier today the Greek foreign minister and
former PM said that "we are in continuous deliberations in order to have
the smallest possible consequences, and if possible no significant impact
whatsoever."
And making
it very clear that this will be a major political issue was a statement by the
main opposition party Syriza which today said that the Greek government's
"blind obedience to the Cold War strategies of Brussels and Washington
will be disastrous for country’s agriculture." In a moment of surprising
clarity, Syriza asked govt to immediately lift all sanctions to Russia, as they
don’t contribute to a solution of the Ukrainian crisis, and "instead fuel
an economic and trade war, in which Greece has unfortunately become
involved." Syriza concluded that the government hasn’t weighted Greece’s
special INTERESTS and bilateral relations with Russia.
Then it was
Slovakia whose premier Robert Fico criticized Ukraine for preparing sanctions
against RUSSIAN persons and companies, and he has called on Ukraine not to
approve them, expressing concerns that the legislation could result in a halt
to natural gas supplies.
If the
conflict between Ukraine and Russia escalates, the legal norm could cause
interruption of natural gas supplies to Slovakia (and to Western Europe) via
Ukraine from Russia, he said.
Slovakia
depends on supplies of Russian gas. However, if gas supplies via Ukraine were
interrupted, Slovakia would get gas through backflow from the West.
"It is
strange that a country that has signed an association agreement with the EU and
which we are trying to help is taking one-sided steps that endanger the
individual economic INTERESTS of EU member countries, instead of coordinating
its approach with the EU," Fico said.
"We do
not want to be a hostage in the Russian-Ukrainian problem. We expect Ukraine
not to adopt formal steps that, if implemented, can endanger our interests. A
country that has signed the association agreement should not behave like
that," Fico declared.
Poland too
complained last week, however for now it finds the fault not with the
"alliance" but with Russia for daring to retaliate to western
sanctions.
Poland's
agriculture minister went on television to announce the country was taking action
against Russia's new import ban. "We believe Russia has broken
international law in both its embargo against Poland and its embargo against
the EU," Marek Sawicki said. Russia banned the import of Polish fruit and
vegetables in early August - a move Sawicki said would cost Poland 0.6 percent
of GDP.
"If a
WTO member state believes another WTO member state has taken a measure that is
not in conformity with WTO rules, the affected WTO member state may request
mediation," attorney and WTO expert Eric Pickett said.
Good luck.
It is only a matter of time before this futile anger at Putin turns not to the
logical response to sanctions, but at the instigator of the sanctions
themselves.
Then it was
most vibrant economy in central Europe, the Czech Republic, where overnight the
finance minister voiced the loudest anger at Russian sanctions yet. From
Bloomberg:
SANCTIONS
ON RUSSIA MAKE NO SENSE, CZECH FINANCE MINISTER SAYS
And
finally, it is the country whose fate is what this conflict is all about, because
should Germany decide it has had enough of DC's geopolitical brinksmanship, one
which always "costs" European allies far more than it does the US,
and aligns with the Russia-China-India axis, then the "Eurasian
Crescent" will be complete, and the countdown to reserve
CURRENCYtransition may officially begin.
Sure
enough, Bloomberg reports that sanctions against Russia are hurting sentiment
at German companies, according to Focus magazine which cites the BGA Federation
of German Wholesale and Foreign TRADE, and the DIHK German Association of Chambers
of Commerce and Industry.
According
to the magazine, "loss of trust in Russian partners is hurting business
more than the sanctions themselves, as German companies cut TRADE more than
required."
The
implications are clear: cost-benefit analysis has shifted too far to the left,
and while Germany was ok with supporting
the "west" in its game of escalating sanctions vs Putin, at
this point there is no further support, and in fact the pendulum is starting to
swing in the opposite direction.
So with
increasingly more eastern and central European nations vocally opining against
Russian sanctions, and with the Ukraine government now clearly engaging in open
provocations to curry popular support for some "unfathomable"
warmongering cause (unless of course it can provide evidence it did indeed
destroy a Russian military convoy on its territory), how long until the
"western" alliance finally folds under its own weight and has no
choice but to roll back the sanctions and de-escalate, in the process handing
Putin the biggest diplomatic knockout round yet?
http://www.zerohedge.com/news/2014-08-16/anti-putin-alliance-fraying-germany-slovenia-greece-czech-republic-urge-end-russian-
