By Gernot Heller and Annika Breidthardt
BERLIN, March 12 A trade conflict between Russia
and Europe over Ukraine would hurt German business but it would
be life-threatening for the Russian economy, Germany's main
trade body said on Wednesday, making its forecasts conditional
on the crisis in Crimea.
"All in all, we are optimistic about foreign business with
large parts of the world. Unfortunately, that is not true for
business with Russia," said Anton Boerner, president of the BGA
"A trade conflict would be painful for the German economy,
but for the Russian economy it would be life-threatening."
Europe's trade volume with Russia accounts for about 1
percent of European Union gross domestic product (GDP) and 15
percent of Russian GDP, BGA said.
The trade association expects German exports to grow by 3
percent this year and imports to expand by 2 percent.
"But these forecasts could very quickly become waste paper
if the crisis in Crimea escalates further," Boerner said.
Since the fall of Ukraine's president following protests led
by pro-Western reformers, Russian forces have consolidated their
hold on Ukraine's Crimea peninsula ahead of a Russian-backed
referendum on the region's future on Sunday.
The new government in Kiev and its Western backers have
denounced the planned vote as illegal.
U.S. lawmakers are preparing sanctions against Russia and EU
leaders could impose penalties, such as bans on visas for key
officials, as early as Monday. On Tuesday, Germany's foreign
minister said the EU would start preparing further responses to
Russia's actions in Ukraine if Moscow does not show signs of
backing down by the weekend.
The German public and business have little appetite for
sanctions on Russia in the most serious East-West confrontation
since the end of the Cold War. Chancellor Angela Merkel has
played a prominent role in the quest for a diplomatic solution,
giving her coalition a boost in a new poll.
Russia is Germany's 11th-biggest trade partner, with some
6,200 German companies active there and bilateral trade worth
more than 76 billion euros, the BGA said.