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”Time for a German-Russian Modernization Partnership“

Magnificence,

Ladies and gentlemen,

I am very pleased to be able to speak at the Urals State University today. I am also particularly looking forward to the discussion with you. You are the future of Russia. And virtually never before has a young generation in Russia had so many opportunities to shape a bright future for itself and for this country.

Many of your grandfathers and great-grandfathers had to go to war against the National Socialist regime. This war brought immeasurable human suffering; it set us all back by decades. The consequences of this war marked the lives of your parents' generation as well – and also of my generation, which grew up in a country with a wall and with barbed wire cutting right through the middle of divided Germany. Today you – and we all – have the good fortune to live in a time in which not only the whole world is open to you and to us. If we do our job well, we will set the stage for a long period of peace, understanding and cooperation. Together we must work to achieve this!

This is the first time I have been in Yekaterinburg, and I am impressed by the city's vitality. Everyone can sense that this is where the action is. You are living in an economic powerhouse that need not hide behind Moscow and St Petersburg.

And many Germans – scientists and entrepreneurs – have already been infected by the city's tempo and dynamism and have come here whether temporarily or permanently. And not just in recent years, by the way: Our ties reach far back in history. It was Alexander von Humboldt who, at the behest of Tsar Nicholas I, set out eastward in 1829 and marked the geographical boundary between Asia and Europe just 40 kilometres from here.

Ladies and gentlemen,

Humboldt is known for charting the world in the early 19th century. Today we have an entirely different situation: Every corner of the Earth has now been explored; all the maps have been drawn. But the borders on these maps are becoming less and less important. In this respect we are witnessing a new mapping of the world at the beginning of the 21st century, one of a completely different kind. With the worldwide division of labour and the globalization of financial markets, new horizons have appeared. Offering tremendous opportunities, but also posing new challenges and risks.

Today, technological progress and especially the Internet make it possible to access an unlimited store of knowledge from nearly any location. Yekaterinburg and Berlin are now just a mouse-click apart. You as students of course take it for granted that you can download the latest journal from the Internet, chat with your friends in New York or New Delhi via e‑mail and form virtual research and learning communities.

The situation has also completely changed for the economic sector. The liberalization of the global economy has breached national borders and allowed our markets for products and services to grow together. For the first time in history, hundreds of millions of people are thus in a position to attain prosperity through their own labour. We are doing all we can to support this.

And what is true of the economy is also true of politics: New political powerhouses are emerging. In Asia, on the Persian Gulf, in Latin America, but also in Africa. This is causing global power shifts. In the future, far more states and regions will influence and shape the world than was the case during the last century.

This rapid change is making the 21st century the first truly global century. An era in which a country's political clout and economic prospects no longer hinge primarily on its land mass. Nor on the number of its tanks and missiles.

Ladies and gentlemen,

No, the new formulas for success and future viability are knowledge, innovativeness and flexibility, the ability and the will to continually change. Only countries and societies that embrace and exploit new horizons can hold their own or redefine their place in the world. The future is there for countries and societies that vigorously modernize, are innovative and courageously tackle structural change.

It is my firm conviction that open societies are best able to do so. We are therefore well-advised to perceive openness and plurality of our societies not as a threat but as an opportunity and a sine qua non for peace and growing prosperity. As in the case of Germany, modernization in Russia cannot be shouldered by the state alone. This would exceed its capabilities. It is precisely for this reason that Russia needs a lively civil society and a lively entrepreneurial culture. A public arena in which different opinions freely vie with one another and reliable rule‑of‑law structures will likewise not harm but instead promote modernization of your country. I would like to champion this approach here today!

And because I know that after Russia's experience in the 1990s the term “democracy” often meets with scepticism and disapproval, I would like to clarify just what I mean by it. Democracy is precisely not disorder, confusion and instability. Rather, democracy is living together on the basis of binding rules that expressly apply to everyone. The rule of law is based on an order governed precisely not by the law of the strongest but rather by the strength of the law, the law to which all are equally subjected! And, as a Social Democrat, let me add: I also stand for an order in which the strong in a country bear more of the burden and contribute more to the common good than the weak. Those are the central political principles that I champion. Because I am convinced that they best further the peaceful coexistence and well-being of all people.

And what is true for domestic policy is also true for foreign policy. With a policy of a balance of powers like we had in the 19th century or a policy of mistrustful self-isolation and confrontation like we had during the Cold War, we will not be able to tackle the problems of our time.

We live in an era in which, for the first time in the history of humankind, we can only solve our key problems by working together. Take climate change, for example: It is changing the lives of people everywhere in the world. It will be just as impossible to win the battle against global warming with the tools of the classical nation‑state as it will to win the fight against terrorism and crime.

What we need therefore is an awareness of our shared responsibility, irrespective of national borders, and, as a logical conclusion, more international cooperation, more integration and more networking. This calls for a rethink: away from traditional power-and-balance politics, away from unilateral enforcement of national interests. Instead, we need a long-term policy that defines common interests and seeks common opportunities. This is the approach we must take. Our common approach!

And from this perspective I discern countless new possibilities and broad scope for creative action in cooperation between Russia and Germany – on politics, business, science and culture. Together we have hitherto unimagined opportunities if we overcome the mindsets of the Cold War.

Ladies and gentlemen,

Russia is and will remain an indispensable partner for Germany and the EU, also in the political shaping of the world of tomorrow. We need your country as a partner for security and stability in Europe – and far beyond. We need each other to address matters of energy security, arms control or the global fight against terrorism.

I am convinced that there can be no security in Europe, in the entire Eurasian area, without – much less against – Russia. But the reverse is true as well: The great goal of a European peace order stretching from the Atlantic to Vladivostok can only be achieved if Russia, too, is willing to move towards us on this road.

Russia faces formidable modernization challenges: renewing infrastructure, investment, creation of a socially just society. Ahead of you lies the enormous task of utilizing your country's wealth of resources to build a broad-based, globally competitive economy.

In all these areas I see a large number of common interests. Germany and the EU are the natural partners in the modernization of your country. We seek this partnership and mutual integration for the common benefit of the people in Russia, Germany and the whole of Europe. We want the historically unique process of transformation and modernization of Russia to be a success.

Ladies and gentlemen,

This is why I am here in Yekaterinburg. I want to tell you that we Germans and Europeans have realized that Russia no longer ends at the Moscow Beltway. More and more German companies have recognized the tremendous opportunities afforded by increased engagement in Russia's regions. Of the 4600 German companies in Russia, a growing number are also active here in the Ural region.

German companies know that here, at the edge of the Urals, is the powerhouse of Russia. This is where 60 percent of crude oil and 90 percent of natural gas are extracted. The world's largest titanium manufacturer also supplies the European aircraft industry (Airbus 380) from here. German companies are involved in many spheres in the Urals: from metallurgy and the modernization of power plants to the development of infrastructure. This, too, has helped drive the rapid increase in trade between our two countries.

You live here at a junction between Europe and the growth markets in Asia. Isn't it fascinating what we can make of this together? Just think of the trans-Siberian railways! The joint venture ”Trans-Eurasia Logistics“, which the German and Russian railways concluded last year, opens the way for extending the rapidly growing trade flows between Germany and Russia as far as China. This will create new opportunities for Yekaterinburg because it will become a centre for logistics and distribution of goods. This is a piece of the future we can build together.

Ladies and gentlemen,

That is why, looking at this region and the whole of Russia, I say: Let us define our shared interests and use them to develop a common agenda for German-Russian relations. An agenda for further expanding our cooperation in traditionally successful areas but above all for cooperating specifically in those areas in which our shared future will be decided: climate and energy policy, concerted efforts to increase energy efficiency, health policy, steps to address the demographic problem, education and science.

Germany is ready to press ahead with the project of a Modernization Partnership. In my talks with President Medvedev tomorrow in Moscow we therefore also want to discuss concrete joint projects.

Ladies and gentlemen,

I would like to single out a few examples of these, starting in the field of energy. Germany as a consumer and Russia as a producer are already natural partners here. But we will need each other even more in the future, also in this area.

We want to assist Russia in further modernizing its energy sector, from exploration and processing to distribution. Above all, however, our countries have a shared interest in increasing energy efficiency. In the long run, even an energy giant like Russia cannot afford to lose approximately 40 percent of its energy production en route to the consumer. Here we clearly have a win‑win situation for both sides. Russia will gain more energy for its own consumption and export. We will benefit if German companies are involved in the modernization of energy infrastructure. At the same time, we will enhance the security of the German and European energy supplies.

And the field of climate protection, too, is full of common opportunities. I am specifically thinking of intensified cooperation in the joint implementation of the Kyoto Protocol. The principle is simple: If German and European firms invest in projects here in Russia that reduce carbon dioxide emissions, they create new emission rights for themselves. This benefits both sides, and the potential is enormous.

Ladies and gentlemen,

When addressing this audience, there is no need to stress that knowledge – not gas and oil – is the crucial resource of the future. That is why education, training and research are crucial investments in the future. They are the foundation for sustained economic success.

For this reason we – Germany and Russia – reached agreement three years ago on a strategic partnership in education, research and innovation. Especially in the field of basic research and in the field of engineering, cooperation is working very well. With no other country in the world does Russia have such close relations in the areas of science and higher education.

But we can still do a lot more in the area in which products materialize from knowledge and innovation, especially in the SME sector. A targeted policy for applied research and targeted provision of risk capital can open up many new opportunities for Russian businesses. We are ready to share our experience here. Our numerous small and medium-size companies are the right port of call.

Basic and further training must be dovetailed even more closely. I am thinking of the public administration here, which is of key importance for industry and the SME sector. We should have the courage to break new ground. Why don't we set up a German-Russian course in public administration, a Master of Public Administration? We also offer support for developing a vocational training system that combines school-based and in-company training. In Germany this model ensures a sufficient supply of skilled workers guaranteeing high standards in production plants and the crafts and trades.

Ladies and gentlemen,

We also need investment in education and science precisely in view of the demographic development in our countries. In Russia, as in Germany, the population is declining. Low birth rates and the progressive aging of our societies pose future risks for both society and the economy in our countries. Your President Medvedev and his predecessor Putin have repeatedly warned of the danger of a demographic crisis in Russia.

The causes and scale of the challenge admittedly differ between Russia and Germany. But I would nevertheless like policymakers, scientists and scholars to develop joint blueprints for countering this future risk: with an astute family and education policy, with concepts for controlled immigration and successful integration.

A modern health policy ranks at the very top of the list of priorities here. It can help raise average life expectancy. For this reason we should also expand our cooperation in the field of medicine. I propose that we thereby focus our efforts on several effective starting points: medical care for pregnant women, modern childbirth methods or the fight against infectious diseases. I will later be visiting the Centre for Pediatric Oncology and Hematology – a prime example of German-Russian cooperation in the health care sector. Let us work together to create many more examples!

Ladies and gentlemen,

Russia's modernization can only prove successful if domestic and foreign capital can count on a reliable legal framework. Sound economic development presupposes trust, and not just that: also procedural dependability, planning certainty, equal and open access to the legal system, independence of the courts. This is also true precisely with a view to your country's future membership of the WTO.

I was very pleased to read that President Medvedev and Prime Minister Putin have placed improving the legal system and strengthening the rule of law at the very top of their agenda. It is my firm conviction that effective, transparent and self-regulating institutions are the key to modernization. Bureaucracy and excessive control cripple development – that is true in any country. Here, too, we can work together, for instance when it comes to further training for judges and lawyers, advisory services for the police and cooperation between the customs authorities. The resulting increase in security would not only serve the economic sector; the people would also reap the benefits.

And, not least, I would also like to recommend a recipe for success that we term the “glue that holds society together”. I mean the ongoing effort to promote social justice. The vast majority of people in Germany support a policy that does not allow discrepancies in the distribution of income to become too great. People in Germany demand that all individuals – and not just a few – share in the economic upturn. There are many ways of doing this, starting with a good system of health, pension and unemployment insurance. But we are also introducing new instruments. Our Government just decided to more strongly promote the participation of employees in the capital of their companies. In this way the employees also share in the company's profits, not just the shareholders. If you are interested, let us also talk about instruments of this kind to promote social justice!

Ladies and gentlemen,

All the future areas of activity within the German-Russian modernization partnership that I have just touched on have a European dimension as well.

It is therefore all the more important that we soon open negotiations on a new Partnership and Cooperation Agreement between the EU and Russia. We want to launch this process at the EU‑Russia Summit at the end of June. The strategic partnership between the EU and Russia needs a comprehensive and reliable foundation. It should highlight the long-term perspectives for our partnership. These also include the creation of a free trade area between the EU and Russia after your country's accession to the WTO. That would be a further important signal that we are going to jointly pursue new approaches to benefit the people in your country and in ours.

Ladies and gentlemen,

Germans and Russians are linked by a long shared history. But even armed conflicts with all the terrible pain and suffering they entail have never destroyed the affection between our peoples. When Germans and Russians meet today, they are not only representatives of governments and businesses. For the most part they are perfectly normal families, schoolchildren and students, mayors and city council members, scientists, academics and artists.

I emphasize this because I am convinced that the German-Russian relationship will only become truly durable and sustainable through personal contacts between people from and across all sections of society.

The future thereby hinges crucially on the younger generation. Only if young Germans and Russians meet each other, develop an interest in each other and learn the partner country's language will the German-Russian relationship have a lively and viable foundation.

This is why we are doing what we can to step up youth and student exchanges. We are glad to see many of you come to Germany to get to know our country or study there! More than 12,000 students from Russia are currently enrolled at our universities, and more and more Germans are studying in Russia. There is hardly a better way to develop a lively partnership between our countries for the future!

Training in Germany is often even a good springboard for a career! Some of those who have studied in Germany are now the President of the Bank of Moscow, hold senior positions in management consulting firms or head Russian universities. I call on you to do the same thing. We will make you very welcome! Anyone here in Yekaterinburg who wants to learn more about our country and its culture can do so at the German Information Centre at this university, which is supported by the Goethe-Institut.

Ladies and gentlemen,

Let us build many new bridges to each other and stride forth to new horizons in German-Russian relations. Especially here in the Ural region!

Your great writer Dostoyevsky once said: “Good times do not fall from heaven. We make them ourselves.” So let's get to work!

Thank you very much.