Foreign Minister Sergey Lavrov’s remarks at a meeting with members of the Association of European Businesses in Russia Moscow, October 31, 2017

Mr Staertzel,

Mr Schauff,

Ladies and gentlemen,

I am glad to have this opportunity to deliver my remarks at the Association of European Businesses. Our moderator has told me that this is the eighth time I will be speaking here. If our meetings are of interest to you, I will be happy to accept your invitations. I believe that our useful, depoliticised and frank dialogue helps us to find points of convergence and common interest and strengthens mutual understanding.

We highly appreciate your commitment to the promotion of cooperation with Russia and your readiness to implement joint projects in various spheres, from energy to high technology. We will always remain your supporters as well as good friends and will help you to do business in Russia in a comfortable atmosphere. President of Russia Vladimir Putin talked about this at a meeting with German business leaders in Sochi, which was also attended by President of Kazakhstan Nursultan Nazarbayev.

It has become a bad tradition to say that the global situation is not improving. There are old crises and conflicts and new security challenges. Of special concern to all of us is the unprecedented outburst of international terrorism. The international community has not yet created a truly global UN-led counterterrorism coalition, which Russia continues to advocate. We are seriously alarmed by some unpredictable actions of the US administration, such as the actual withdrawal from the Joint Comprehensive Plan of Action on Iran’s nuclear programme, as well as increasing threats to apply a military solution to the Korean problem.

As we see it, one of the main reasons for the increasing global instability is the inability of a small group of US-led countries to work jointly together based on equality and mutual respect with due regard for the interests of each other. We see flagrant disregard for the fundamental principles of the UN Charter, including the use of military force without the Security Council’s mandate, which has seriously damaged global and regional stability and promoted the proliferation of extremist and terrorist ideologies. The current situation in many countries in the Middle East and North Africa, where statehoods have been undermined and chaos is reigning, is the direct result of the opportunist policies that have been implemented in Iraq and Libya and are being implemented in Syria.

Explicit attempts to use unilateral sanctions as a tool to promote unfair competition in violation of WTO norms and numerous UNGA resolutions condemning unilateral illegal methods of coercion adversely affect global trade.

Given this, relations between Russia and the European Union are developing unevenly. Indeed, there have been positive developments in a number of areas. After bilateral trade was down by more than half over the past three years, we saw mutual trade increase by 25 percent over the first eight months of this year. This is a good result even though the starting point was low. The political dialogue has intensified. President Putin had a meeting with European Commission President Jean-Claude Juncker in July on the sidelines of the G20 summit in Hamburg. We maintain regular contacts with the EU High Representative for Foreign Affairs and Security Policy Federica Mogherini. Expert consultations are held on issues of mutual interest. In particular, for obvious reasons, Brussels is willing to discuss migration and readmission matters with us. We are ready for this, but we believe it would be correct to restore all our sectoral dialogues frozen unilaterally by our EU colleagues.

However, I must admit that there are attempts to prevent Russia-EU relations from getting back on track of progressive development. We can see who is behind this. We observe the destructive policy pursued by a fairly small but very aggressive Russophobic group of European states. They are trying to play an anti-Russian card within the EU in order to achieve their self-serving geopolitical goals. As you may be aware, we are being accused of interfering in elections not only in the United States, but some European states as well without a single piece of evidence to corroborate this. Of late, Moscow was accused of making decisions regarding ministerial appointments in South Africa. In a word, the fantasy is running wild.

To counteract the evidence-free danger coming from Moscow, various anti-Russian entities are being created, such as the Strategic Communication Group East, which will function as part of the European Foreign Service, as well as a multinational “centre of excellence” for combating “hybrid” threats in Helsinki. I recently had talks with Foreign Minister of Finland Timo Soini and asked him what the centre will actually be doing. He said that, probably, it will engage in studying all the hybrid threats that there are, and that they would be glad if Russia joined this centre. It was mentioned during a conversation, but nobody invited us there officially. If they do, it will probably be an interesting project to join. So far, at least, such an invitation has not been extended. These steps to create different entities and to combat hybrid threats carried out by the media resemble hunting for dissidents and are unlikely to help restore any trust.

The attempts of these self-serving forces in the EU to politicise and undermine the energy dialogue between the EU and Russia are a cause of concern. There are accusations that the EU has become overly dependent on Russian energy despite the fact that the amount of Russian gas on the European market is absolutely comparable to that supplied by Norway and makes up about one-third of the total amount. Attempts are being made to discredit joint projects, such as Nord Stream-2, although it is designed to significantly reduce transit risks, improve the EU's energy security, and contribute to EU economic growth. After all, about 200 companies from 17 member states will be involved and that’s only at the construction stage of the Nord Stream-2.

We are perplexed by the attempts of some members of the European Commission to impose on it decisions on the need to receive a negotiating mandate for signing a special agreement with Russia on Nord Stream 2. These attempts are absolutely groundless. The legal service of the commission clearly said that there are no foundations for extraterritorial application of EU law in the Baltic Sea. The legal service of the EU Council reached the same conclusion quite recently. We believe the introduction of new legal norms exclusively for Nord Stream 2 amounts to politically motivated discrimination against the project’s investors. Incidentally, as I understand, Denmark does not even try to conceal this and has even passed a corresponding law. I believe it must be unique in legislative practice for economic and energy projects.

The growing energy needs of Southern and South-Eastern Europe could be met by the extension of the second branch of the Turkish Stream to EU territory. Many governments of EU states have shown considerable interest in this. We are open to this, but considering the unfortunate experience of the South Stream, we will start this work only after receiving firm legal guarantees from Brussels.

I still hope that common sense will prevail because we are natural, mutually dependent partners in the energy area. Long-term failsafe supplies of Russian hydrocarbons to Europe provide substantial competitive advantages for the economies of EU countries, not to mention the fact that this year the export of Russian energy sources to Europe has set a historical record.

Ladies and gentlemen,

Speaking before such an educated audience, I hardly need to explain in detail that attempts to isolate Russia, punish it for its independent foreign policy and compel it to change course, have failed and could have never succeeded. Positive trends are growing stronger in the Russian economy, which is confirmed in recent reviews of the World Bank and the IMF.

New opportunities for foreign business are opening up in Russia against the backdrop of the restored economic growth. This goes for the companies you represent as well. The US-imposed sanctions are the main obstacle on this road. We noted that, speaking at the European Parliament's Committee on International Trade, Mr Schauff said these sanctions damage industry in EU states because European producers in the Russian market are replaced by companies from other parts of the world. This is an objective fact that cannot be even disputed.

Using the excuse of countering the Russian threat, Washington is not only trying to patch up so-called “Trans-Atlantic solidarity” but also to advance its economic and energy positions in Europe, edge out our joint energy projects, and challenge Russia in the arms market that is the target of the last portion of the announced sanctions. President of Russia Vladimir Putin said at the recent meeting of the Valdai International Discussion Club that some “do not even conceal that they are using political pretexts to promote their strictly commercial interests.”

It is up to Europeans to decide how much they need to antagonise Russia. We know that the political and especially business circles of EU countries are increasingly often expressing discontent with this situation. President of the European Commission Jean-Claude Juncker repeatedly spoke about the need to restore dialogue with Russia, for instance, at the conference in Luxembourg in early October. I believe these words will be translated into practical deeds sooner or later.

Against the backdrop of these events we hear allegations that Russia is interested in a weak EU and is trying to divide it. This is untrue. We want (and we have always said this) to see the EU – our neighbour and key trade and economic partner – as a strong, united and independent international player capable of determining its priorities on the basis of a stable balance of the national interests of all its members rather than only on the basis of the position of its aggressive minority on policy towards Russia.

In turn, we will be open to develop cooperation at a pace and to an extent suitable for our EU colleagues. Naturally, in the process we will continue our multi-vector foreign policy of consolidating diverse cooperation with those states that have got rid of ideological blinkers in their economic relations with foreign partners. These states form an overwhelming majority. We will strengthen Eurasian integration and step up practical work in the SCO, BRICS and other associations that are engaged in a search for mutually acceptable agreements and are free from dictates. Incidentally, the G20 is one such association.

What do we think about future EU-Russia relations? The creative potential for cooperation – from trade to the countering of new challenges and threats – is truly enormous. It is important to use it correctly. Russia is consistently advocating the formation of a common space of peace, security and partnership. Many great Europeans, including Charles de Gaulle and Helmut Kohl, spoke about the need to build Greater Europe without dividing lines.

I am convinced that today it is necessary to speak about indivisibility of not only security but also economic development.

Aware of this objective reality, the EAEU is actively stepping up dialogue with dozens of countries and associations on all continents. It continues working on aligning Eurasian integration with China’s One Belt One Road initiative. There is growing interest in the formation of a new integration loop that President Vladimir Putin called the greater Eurasian partnership with the participation of member-states of the EAEU, SCO and ASEAN. We will welcome the EU’s joining this work. We share a continent. To begin with, we hope to receive a reply to the proposal to establish contacts between the EAEU and the EU. For the first time it was made two years ago and we regularly remind our partners about it. We heard timid promises to start this work at technical level. We are ready to work at any level. We consider it counterproductive when two neighbouring integration associations do not have direct contacts.

We continue to proceed from the long-term, non-opportunistic and intrinsically valuable nature of relations between Russia and the EU, all the more so since much in the life of our people and the world in general depends on the shape they are in. I believe we should preserve the accumulated capital of the Russia-EU partnership. We are ready for this. We will continue supporting European entrepreneurs in their commitment to build up their presence in this country and carry out mutually beneficial projects with Russian partners.

Question: I am surely speaking for the majority of European investors in Russia when I say that Russia needs Europe and Europe needs Russia. European business is deeply integrated in the Russian economy. For instance, our company Siemens has 7,000 employees here. They perform not only representative functions but also the functions of economic integration as distinct from many representatives of US companies. At the same time we are bound to see that the ratcheting up of US sanctions is creating a “toxic cloud” for European business in Russia. In this context I’d like to ask you if you see an opportunity for bilateral dialogue between Russia and Europe, improving relations between Russian and European business and the relaxing of sanctions, which we are greatly looking forward to as representatives of European investors.

Sergey Lavrov: Talking about bilateral dialogue it is necessary to understand that we did not break off this dialogue. We had probably the most ramified mechanism of cooperation with the EU among our foreign partners. More than twenty sectoral dialogues, summits twice a year, annual meetings of the Permanent Partnership Council at the level of the Russian Foreign Minister and the High Representative of the European Union for Foreign Affairs and Security Policy and consultations on international issues and human rights. Now practically everything has been frozen, as I have mentioned. There are attempts to resume dialogue on migration. One round has been held (apparently, it is no longer possible to tolerate lack of dialogue on a subject that is very important to all of us). The same applies to the dialogue on readmission, which is directly linked with the dialogue on migration. The first contacts on counterterrorism and anti-drug measures have taken place after a long break.

By the way, Estonia that is in charge of the EU during these six months has not included either anti-terrorist or anti-drug measures into the programme of its Presidency, as was expected. On the whole I find it difficult to understand the current role of country presidencies when after the Treaty of Lisbon they are not even allowed to host summits with foreign partners (they can only be held in Brussels). It appears that summits were taken away, but these countries can shape the agenda proceeding from their own interests, ignoring the position of the entire EU. It’s their domestic business, but terrorism and drugs are issues that always warrant discussion.

You are probably primarily interested in business dialogue. In the past three-odd years we have gained experience with bilateral business platforms. Quite recently, the “captains” of German business visited Sochi and talked with President of Russia Vladimir Putin and President of Kazakhstan Nursultan Nazarbayev. Similar meetings were held in Germany at my level when Sigmar Gabriel headed the Economic Ministry. Such bilateral meetings also took place with French, Italian and Austrian entrepreneurs. But I have not heard for a long time about EU-Russia business dialogue, which had always been one of the major components in the preparations for a summit, for instance. That said, the entrepreneurs that are in charge of this dialogue on our side are obviously ready for it.

It is a good question by the way. During this time I almost got out of the habit of mentioning the Russia-EU business dialogue. Ask in Brussels and I will ask our businessmen who is avoiding contacts.

As for sanctions (I mentioned them in my speech to illustrate all factors that influence our relations), we cannot and will not ask for their removal, all the more so since we are told to do something “good” – from the Western point of view, and they will have a pretext for removing sanctions. In other words (and we are being told this by many people) this proposal contains an understanding that sanctions are useless and do not benefit anyone. They embody the absolutely politicised position of those who want to “punish” Russia and gain competitive advantages. It is interesting to hear about an excuse for removing sanctions.

Let me recall that sanctions as a means of competition have been used for a very long time, primarily by the United States. According to my information, private European companies were fined for over $200 billion from 2008 to 2016. Volkswagen alone had to pay a fine of $14.5 billion in 2016. Total was punished for “commercial bribery” and BNP Paribas for relations with Cuba, Sudan and Iran. Alstom had to suffer for some corruption schemes in Indonesia, Credit Agricole for cooperation with Sudan, Cuba and Iran. Swiss UBS was charged with concealing information on US citizens. There have been many cases.

As you understand, all this had and has nothing to do with what Russia is doing. This has nothing to do with Crimea, which regained its status as part of Russia after the anti-constitutional coup d’etat in Kiev, a criminal action that the residents of Crimea did not accept. All this has nothing to do with Donbass, either. Both Donbass and Crimea are simply a convenient excuse for our American colleagues to engage in unfair competition and undermine the positions of rivals.

This is why this topic is not limited to an agreement on what UN peacemaking mission should be sent to Donbass or to the situation where, once we agree, the Europeans will again find an excuse (again an excuse!) to start relaxing sanctions. The question is much broader. It is necessary to see the entire picture that is linked with extremely intense competition, in which the Americans (I do understand them) want to be more successful than all others. I understand this desire, but it is very difficult to justify their methods. 

Question (via interpreter): I have three brief points I would like to make. First, I think claiming that business is business and politics is politics is unrealistic. Second, it is imperative to stop saying bad things about each other, if we want to improve our relations. Third, the EU also wants Russia to be strong and uphold its interests on the basis of international law.

You say that Russia does not want to split the EU, but then proceed to say, in the next sentence, that a number of EU countries are bad. EU policy is coordinated by 28 countries. With regard to implementing the Minsk Agreements, I know that Germany, France, and the United States are working with Russia to agree upon the UN Security Council resolution on peacekeepers in Donbass. We must rely on ‘islands’ of cooperation such as business, education, and science. We need to talk more about the positive aspects of our relations that unite us.

Sergey Lavrov: I will take it up where you stopped and said that we should talk about what unites us, not what divides us. So, we are trying to talk about energy. It is supposed to unite us, correct? Well, in fact, it divides us. Not through our fault or the fault of Germany or the overwhelming majority of the EU member states, but through the fault of a handful of countries that can be counted on the fingers of one hand. They are convinced that they and the EU countries are better off paying 50% extra for US liquefied natural gas than buying cheaper gas from Russia. That's all there is to it.

By the way, with respect to economics is economics and politics is politics. In this particular case, for these countries, politics is economics, and economics is politics.

I have already commented on the information that the European Union makes decisions based on the position of all 28 countries. When 28 countries say that they need to resolve any issue based on consensus and solidarity, I understand that in the presence of contradictory approaches among the 28 countries, the middle ground is chosen as a common position. With all due respect, I must note that when it comes to politics with regard to Russia, the EU position and solidarity are determined not on the basis of middle ground, but on the basis of the lowest common denominator, which is determined, primarily, by the aggressive minority that can be counted on the fingers of one hand, as I mentioned.

Marcus, I can see that you disagree. I am not the one who makes decisions in the EU. I'm talking about how we see it from the outside, not on the basis of speculation, but, frankly (I hope I will not disappoint anyone), on the basis of confidential bilateral talks with many EU member countries.

I fully agree that we must lower the mutual rhetoric. I am all for it.

Just like we need a strong EU, the EU needs a strong Russia. I fully support what was said about the need to do so on the basis of international law, which implies rejecting unconstitutional anti-democratic methods of changing governments.


To be continued...