BERLIN, July 28 Germany's main business lobby on
Monday backed tougher sanctions on Russia, saying such pressure
may help solve the conflict in Ukraine, although it could damage
both the German and European Union economies.
The EU has frozen assets and banned travel for some Russian
officials, after Russia annexed Ukraine's Crimea region and
began supporting separatists fighting Kiev's forces in eastern
Ulrich Grillo, the head of the Federation of German Industry
(BDI) lobbying group, said more sanctions should not be ruled
out. He spoke before EU policymakers meet on Tuesday to discuss
whether to impose further sanctions.
"The BDI and I personally have become convinced that the
behaviour of the Russian government in the Ukrainian conflict of
secession must have noticeable consequences for Moscow," Grillo
wrote in a guest contribution for Handelsblatt newspaper.
"As painful as further economic sanctions will be for
European business development, for German exports and for
individual companies, they cannot and must not be ruled out as
a way to apply pressure on the Russian government."
Germany, Europe's biggest economy, sold about 36 billion
euros of goods to Russia last year, almost a third of the EU's
total. But its exports to Russia dropped by 14 percent in the
first four months of this year and some business groups have
warned that the decline endangers some 25,000 jobs in Germany.
On Sunday, German Finance Minister Wolfgang Schaeuble told a
newspaper Germans must put peace before economic considerations
and accept tougher sanctions against Russia if necessary.
Grillo acknowledged the effect of sanctions were arguable
but said Russia's dependence on "raw-material exports and on
access to international capital markets" could be pressure
"The sanctions agreed so far, which are quite manageable,
have already shown initial effects on the German economy,"
"Harsher sanctions will lead to significantly more
noticeable consequences. The economic damage that will arise for
Germany and the other EU countries will be more than cancelled
out, however, if we succeed in enforcing international law in
Europe and a legal framework in general."
(Reporting by Annika Breidthardt; Editing by Larry King)