German companies pay 1.72 billion euros annually to Russia
About 248 German companies continue to operate in Russia, legally exploiting a loophole in the sanctions, but critics argue that their presence indirectly supports Vladimir Putin's war in Ukraine. Economists and advocacy groups have raised ethical and strategic concerns about these operations.
German companies contribute significantly to supporting the Russian state through taxes, which helps finance military operations. According to the Kyiv School of Economics (KSE) and B4Ukraine, German companies paid up to 1.72 billion euros annually in various taxes between 2022 and 2024, enabling Russia to purchase drones, missiles, and other weapons.
Companies like the cheese factory Hochland maintain their operations in several Russian regions, providing thousands of local job opportunities. The company justifies its continued presence by supporting employees and partners, despite declining profits and public criticism regarding its contribution to the Russian war economy. Hochland does not plan to sell its Russian factories for financial and strategic reasons.
Other companies like the Knauf gypsum factory have faced accusations of indirect involvement in the reconstruction efforts of occupied Ukrainian cities such as Mariupol. Knauf denies any direct dealings with the Russian government, asserting that its products are sold to independent traders. However, critics warn that these supply chains and technologies inevitably support Russian operations.
B4Ukraine and economic oversight bodies confirm that the continued activity of these companies undermines international sanctions and Western support for Ukraine. CEO Nadir Sanani demands an immediate and complete withdrawal from Russia, emphasizing that losses must be written off and that companies must completely stop feeding the Russian war machine.