How Putin left his German friend Gerhard Schroder's legacy in shambles

On February 22, German Chancellor Olaf Scholz suspended the ambitious Nord Stream 2 pipeline project with Russia. His decision did not exactly come as a surprise but it did mark a dramatic U-turn for his own party, the centre-left Social Democratic party (SPD), which had initiated and seen the project through completion.

Scholz’s move to punish Russia for its invasion of Ukraine also means that he might be destroying what could have been a legacy of his own partyman and former Chancellor Gerhard Schroder, considered the man behind the $11 billion project, designed to double the gas supply from Russia to Germany.

Over the years, the SPD had vehemently defended the project against criticism—specially from its own political ally, the Green Party, and also the United States—and Schroder’s role in the project had a big part to play in its stand.

Schroder actively lobbied the Russian gas company Gazprom to push through the Nord Stream 2 project. Although he is no longer politically active, Schroder still greatly influences politics in Germany.

Schroder era and Germany-Russia friendship

In order to be able to understand Schroder's influence on German politics, it is necessary to understand Germany's foreign policy strategy during Schroder's period. During his term in office between 1998 and 2005, Schroder, together with the Greens in the coalition government, pursued a foreign policy based on independent decision-making, away from the US’s sphere of influence.  Basically, Germany wanted to establish Europe as an independent actor in international politics. This foreign policy line led to Germany deepening its relations with Russia at the cost of neglecting its transatlantic relations with the US. 

This foreign policy strategy was to leave a lasting mark on Germany and Europe. Schroder and Putin were very well known for their “male friendship” at the time and still maintain excellent relations. Putin's speech in the German Bundestag in 2001 was the greatest symbolic event for German-Russian relations at that time. In his Russian-German speech, Putin spoke of a close partnership with democratic Europe and praised German culture in particular. The members of the Bundestag were impressed; a close partnership with Russia seemed possible.

Transatlantic relations reach a low point

On the other hand, transatlantic relations with the US  deteriorated. It worried the US that Germany was acting more and more independently and no longer entirely adhered to American guidelines. The Iraq crisis in 2003 was to mark the final break between Germany and the US. Washington had called on its western allies to send troops to Iraq. Germany, together with France, other western EU states, and Russia, opposed this demand. Schroder's decision to reject the US demand was a conscious one. It showed Germany's ambition to act independently in international politics and pursue a common line with Russia.

A shocked US put relations with Western Europe on hold. Minister of Defence Donald Rumsfeld went to the extent of calling called Western Europe “old Europe” while declaring the Eastern European NATO member states “new Europe”. German-American relations had reached their lowest point and would continue to do so until the election of Angela Merkel in 2005.

Schroder's lobbying activities for Russia

Although the former SPD Chancellor has retired from active politics, he continued to be active in the background, especially for Russian gas companies.

Shortly after the end of his term in office, Schroder took over chairmanship of the supervisory board of Nord Stream AG, 51 percent of which belongs to the Russian company, Gazprom. For Putin, this was a prestigious success in order to be able to push through the Nord Stream pipeline project. Several German politicians criticised Schroder's decision and accused him of selling himself to Russia. 

Schroder refuted the criticism saying he was acting in Germany's interest and wanted to secure Europe's future energy supply.

According to political expert Liliya Shevtsova, Schroder is the most influential lobbyist for Gazprom in the whole of Europe, if not worldwide. The former chancellor showed his importance for the Russian gas company at a meeting between Eckhard Cordes, chairman of the Committee on Eastern European Economic Relations, and Alexander Rahr, a lobbyist for the gas producer Wintershall at the Russian embassy in Berlin in 2014. Wintershall was the most significant German producer of crude oil and natural gas. Gazprom wanted to buy a majority stake in the German energy company; then, the natural gas trade was wholly transferred to Russian ownership in 2015.

In addition, Schroder was elected head of the supervisory board in 2017 at the suggestion of the Russian government, which holds the majority of shares in the energy company Rosneft.

Schroder's role in Nord Stream 2

In 2017, Gerhard Schroder initiated the Nord Stream 2 project. Schröder organised a meeting between Gazprom boss Alexei Miller and German Economics Minister Brigitte Zypries. Zypries was the justice minister in Schroder's second cabinet. After the conversation, Gazprom announced that a “working meeting” between Miller and Zypries had taken place in Berlin, although the energy company did not name Schroder's role in the meeting. 

Gazprom began construction of the gas pipeline in mid-May 2018 and finally completed it on December 29, 2021, but operations have not yet started. Gazprom rewarded Schröder for his active lobbying by nominating him for the supervisory board at the company.

Chancellor Olaf Scholz largely toed Schroder's line on the Nord Stream project. And it is understandable. Scholz was SPD secretary-general between 2002-2004. Last year, the SPD Minister-President of Mecklenburg-Western Pomerania, Manuela Schwesig, founded the “Stiftung Klima- und Umweltschutz MV” (MV Climate and Environmental Protection Foundation) with her government. This foundation is supposed to protect the Nord Stream 2 project from American sanctions and guarantee its realisation. 

Now, the SPD politician has announced her intention to dissolve the foundation.

Schroder polarises German politics

Schroder's lobbying has not gone unnoticed, especially by politicians from other parties. For example, Claudia Müller, a member of the Green Party in the Bundestag, said that it was once again becoming apparent whose interests Schroder represents, namely “those of the Russian oligarchy around Putin. There should be consequences”. 

Parliamentary Secretary Stefan Muller (CSU) had argued that Schroder should be deprived of the official benefits given to a former chancellor. This would mean that Schroder would lose his office and staff in Berlin. FDP politician Marie-Agnes Strack-Zimmermann is in favour of this decision. 

Previously, after more than 20 years, Schroder's long-time office manager and speechwriter Albrecht Funk had left Schröder. The football club BVB Dortmund has also withdrawn Schroder's honorary membership and Hannover 96 is also considering kicking out the former chancellor. 

The pressure exerted on Schroder shows how important it is in Germany to distance him from Putin. If Schroder were to step down and end his relations with Putin, Germany and Russia would lose a trustworthy mediator in a possible diplomatic solution.