The Austrian Institute of Economic Research (WIFO) has calculated that the anti-Russian sanctions have cost the European Union €100bn and two million jobs. Germany alone faces a loss of 1% of GDP.
"Russia has an alternative to Europe, but not vice versa," noted former Chancellor of Germany Gerhard Schröder referring to Russia's so-called "turn to Asia". Most German media refrained from quoting Schröder, thinking it is no big deal, a statement from a political pensioner, a friend of Putin receiving a salary from Gazprom. Just in vain.
Schröder is one of the many who warn Germany against a deadlock looming over the escalation of the current crisis. Chiefs of the economy tightly bound to trade with Russia discourage exacerbation of tensions in unison. Former chancellors and the former leader of the Social Democratic Party of Germany advocate that the rhetoric be eased. But the former political leaders can take the liberty to do so. There have been no sightings of politicians currently in power willing to concede to Moscow.
Meanwhile, the Austrian Institute of Economic Research (WIFO) has calculated that the anti-Russian sanctions have cost the European Union €100bn and two million jobs. Germany alone faces a loss of 1% of GDP. The bleak forecasts are proven by the bitter reality. During first three months of 2015, exports of German machinery to Russia dropped by 28%. Neither Germany nor Europe as a whole have any substitutes for the Russian market outlet.
Nevertheless, the sanctions were extended by half a year. They may be further extended later on. And then again. Well, why not? Russia will doubtlessly keep Crimea. This means that there will be a formal reason for the sanctions.
It is easier to freeze relations than to return to pragmatism. Imposing sanctions is easier than lifting them. Even if they are ineffective. Their purpose was to punish Russia, to change its position on Ukraine, to weaken Vladimir Putin. But the result was quite opposite. According to Dr. Stefan Meister, an expert at the German Council on Foreign Relations (DGAP), a prominent German think tank, the confrontation with the West will be the "decisive resource of power" for the Russian president for years to come. His total control over the processes in the country is uncompromising and indisputable. The logic of the standoff guarantees that Moscow will not make any concessions that may be imposed on it.
The West, however, cannot revive the old agenda without losing its face. The Crimean problem may become unresolvable in the existing geopolitical system for a long time. Angela Merkel is steadfast that Russia and the EU are suffering from a conflict of values. It is a fundamental subject. It cannot be counted in cash. As we remember from the Cold War Era, an ideological struggle is waged without regard to the losses.
