FRANKFURT (AFX) - Former German Chancellor Gerhard Schroeder in a Handelsblatt interview defended his decision to head the supervisory board of the North European Gas Pipeline (NEGP) after his government guaranteed credit for the venture.
Schroeder told the newspaper in an interview to be published in tomorrow's edition he was unaware his administration had guaranteed a credit of 1 bln eur (1.2 bln usd) for OAO Gazprom's portion of the pipeline construction.
He added that Gazprom had no plans to take the loan.
'I did not know about these proceedings,' he said.
'But the key point is that Gazprom has already said that it has not and will not accept the financing option put forward by the banks. Thus there will not be a federal loan guarantee for the two German banks.'
The economy ministry confirmed Saturday that an inter-ministerial commission rushed through a 'decision in principle' on October 24 last year while waiting for a new coalition to be formed by current Chancellor Angela Merkel.
Schroeder said he was only offered the supervisory board post after he left office in November.
His annual salary is 250,000 eur.
'I cannot see anything wrong with that,' he said.
The pipeline agreement was signed just 10 days before the German general election in September, at a ceremony attended by Schroeder and Russian President Vladimir Putin.
Critics in Germany blasted Schroeder's involvement in the project, particularly in light of the credit guarantee, as a 'sweetheart deal' that muddled his personal interests with those of the country.
'This affair stinks to high heaven,' said Guido Westerwelle, leader of the liberal opposition Free Democratic Party, who is embroiled in a legal battle with Schroeder over his previous attacks of the Gazprom job.
Schroeder said in the interview that he believed the deal would help secure Germany's long-term energy needs.
'Federal loan guarantees are a tried and tested instrument to defend the economic interests of our country,' he said. 'That especially includes a reliable supply of natural resources for German industry.'
Schroeder also fiercely defended his personal friendship with Putin when asked about concerns that the Russian state was becoming increasingly centralized and authoritarian.
'I am among those who are still of the opinion that the Russian president assures democratic development in the country,' he said.
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