Rheinmetall and Russia: billion-dollar dreams shattered


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As of: March 3, 2024 6:00 a.m

Ten years ago, the federal government stopped the delivery of a state-of-the-art combat training center from Rheinmetall to Russia. Research by WDR Investigative show: Rheinmetall and the Russian army had even bigger plans.

June 2011: Defense Minister Anatoly Serdyukov and his Chief of General Staff Nikolai Makarov came personally to the signing of the contract. Previously, the Russian military leaders were allowed to explore for themselves on a Bundeswehr site what was soon to be built in Mulino, Russia: a state-of-the-art combat training center in which lasers replace training ammunition and every detail of the training units is immediately evaluated by computers.

Rheinmetall celebrated the deal on its homepage: “This will create the world’s most modern training base with simulation-based training in the Volga region by 2014, in which up to 30,000 soldiers can be trained per year.” The company hoped to enter a huge market, Russia, with the training center as a core element in the modernization of its army.

Rheinmetall and its new Russian partner, the state-owned arms company “Oboronservice AG”, were apparently in a hurry. The then black-yellow federal government issued the necessary export permits. The training center should be fully operational in 2014.

Rheinmetall lawsuit

The euphoria was followed by disillusionment: After the annexation of Crimea in February 2014, the new Economics Minister Sigmar Gabriel (SPD) stopped the delivery of components for Mulino.

Rheinmetall therefore demanded compensation of 130 million euros from the federal government. One of the company’s main arguments is that the arms deal with Russia was not only wanted by the federal government, but was also massively supported. This results in a “special protection of trust”.

However, the arms company initially failed in an urgent procedure before both the Frankfurt Administrative Court and the Hesse Administrative Court. Since then, the proceedings have been suspended, as Rheinmetall confirmed upon request.

Previously kept secret trial documents from 2014 WDR Investigative available, not only prove how close the interaction between the federal government, the Bundeswehr and Rheinmetall was. The company’s written documents also show that it was not just about the already approved training center in Mulino, but also about up to eight training facilities with a total volume of one billion euros.

Support from the Federal Government

Upon repeated requests from WDR Investigative A spokesman for Rheinmetall confirmed the information at the time. However, the statements referred solely to “the planning considerations at the time in coordination with the federal government”. The relevant contracts had not yet been concluded at that time.

In the proceedings, the company’s lawyers also list in detail the support from the federal government. The project’s key data were set at a three-day meeting of the “German-Russian Armaments Commission” in March 2009 – “mainly with the participation of the Ministry of Defense.” The minister at the time was Franz-Josef Jung (CDU). He later sat on the supervisory board of Rheinmetall.

In September 2011, a few months after the contract was signed, his successor Thomas de Maizière (CDU) traveled to Moscow for his only visit. In addition to Defense Minister Serdyukov, he also met the head of the state-owned arms company “Oboronservice AG”, according to previously unpublished pictures ARD-Studios Moscow.

Speaking to the press in Moscow, de Maizière was downright euphoric: “Our relations with Russia are not good. They are very good!” Germany has an interest “in a modern Russian army that is well led.” His counterpart Serdyukov raved about the “huge potential for cooperation between Russia and Germany.”

Early warnings

Upon request from WDR Investigative de Maizière no longer wanted to comment publicly on the Rheinmetall deal. However, after the Russian attack on Ukraine, he stated several times that he had always been “very skeptical” about the project. But there were many supporters, especially in the leadership of the Bundeswehr.

However, the then army inspector Bruno Kasdorf firmly disputed this: “We have a clear primacy of politics. Nothing happens in the Bundeswehr that is not politically wanted.” Some skeptical tones only came from the Foreign Office. There they were primarily confronted with concerns from the Baltic states, which saw the Russian military reform as an immediate threat to their immediate neighboring states: “We warned quite loudly at the time,” explains the then Estonian Foreign Minister, Urmas Paet, and recalls the Georgia war in 2008.

The government-affiliated Science and Politics Foundation also highlighted the offensive orientation of the Russian military reform in a large study. “In the West all we saw was the reduction in the size of the armed forces. Russia’s main concern was to be able to assert its dominance in the post-Soviet space with a modern operational army,” explains the SWP’s Russia expert, Margarte Klein.

“Looking back, you can of course say: We should have taken the Georgia war in 2008 as a warning,” admits Kasdorf. “But we wanted to extend a hand to Russia and integrate it into a European peace order.”

Russian officers briefed in Germany

Rheinmetall was apparently one of the first to recognize a billion-dollar market in the Russian military reform. The black-yellow government, in turn, saw the promotion of arms exports as an opportunity to offer the company compensation for the decline in orders from the Bundeswehr.

As a result, a dense network of politics, military and industry formed around the Mulino combat training center. Russian generals were repeatedly guests at the German reference center in the Altmark. Conversely, the then German Inspector General Volker Wieker was shown the construction work in Mulino – just one day before the major contract for Rheinmetall was signed.

At the working level, a special military advisory group was established in the Bundeswehr. In 2013, Russian officers came to Germany to be briefed. In return, the Bundeswehr sent soldiers to Mulino several times for several weeks to instruct Russian soldiers on site in the new technology. Rheinmetall meticulously listed all of this for the Hesse Administrative Court.

Dress rehearsal for the 2022 attack

The information was essentially confirmed by the then Army Inspector Bruno Kasdorf: “From all of this you can see how absurd the accusation is that the West provoked Russia back then. The opposite is true.” The retired general remembers that a joint German-Russian exercise was even planned for 2014. Because of the geographical proximity to the Baltics, there was also sharp criticism from NATO’s eastern partners.

The annexation of Crimea abruptly stopped this cooperation, as did the delivery of the training center for Mulino.

Rheinmetall, however, insisted on its export license and explained to the courts that it “can be ruled out that (…) a foreign policy aimed at peace between peoples (…) could be jeopardized by the export of the combat training center.” And even more succinctly: “There are no dangers from this.”

The combat training center was completed by Rheinmetall’s Russian partner “Oboronservice AG” after the export ban – without the missing components from Germany, but probably with considerable know-how from there.

In September 2021, President Vladimir Putin visited the Mulino facility. He inspected the “Zapad 21” maneuver, which military experts saw as a dress rehearsal for the attack on Ukraine. Television images show Putin in front of the monitors in which the data from the practicing troops is coming in. Five months later, the Russian armed forces launched the major attack on Ukraine.

You can see more about this and other topics today at 12:45 p.m. in the Europamagazin in Erste.

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