Merkel sets limits to Nato solidarity with Baltic states

"I want to stress that ... Article V of the Nato contract - the duty to provide mutual support - is not something which just exists on paper, but is also something which must be filled with life”, she told press after meeting Latvian prime minister Laimdota Straujuma.

She noted that German jets will start Nato air policing operations in Latvia on 20 August and that Nato is to build up a rapid reaction force to be used if Russia tries to destabilise its Baltic neighbours on the Ukraine model.

"I absolutely understand the concerns of the populations in Latvia, but also in the other Baltic states, and Poland, too”, she said.

She ruled out building permanent Nato bases in the region because, she noted, this would violate a 1997 Russia-Nato accord on troop deployments in Europe, however.

"We won't have a permanent stationing of combat troops but we will boost our participation in other ways ... we will do what it takes to guarantee that, should Latvia come into difficulties, Nato will be able to help straight away".

For her part, Straujuma said Russia’s attack on Ukraine has "fundamentally changed the security environment in Europe … trust has been lost”.

She noted that she is “pleased that Ms. Merkel has affirmed that the words [Nato’s Article V] are not just words on paper" and that the German leader “promised” to help Latvian dairy producers struck by Russia’s import ban on EU food.

Merkel’s remarks on Article V and the rapid reaction force echoed statements by Nato’s military chief, Philip Breedlove, on Sunday.

Meanwhile, Pavlo Klimkin, Ukraine’s foreign minister, said on Monday that Merkel plans to visit Ukraine on 23 August in what he described as a "very interesting" trip.

The Ukraine conflict and the EU-Russia confrontation show little sign of abatement despite German diplomatic efforts.

Ukraine’s president, Petro Poroshenko, told press also on Monday that Russia has in the past few days sent 1,200 trained militants to east Ukraine.

Its parliament speaker, Oleksandr Turchynov, said on a visit to Lithuania that Ukraine plans to join the EU in the next five years and to join Nato - a red line for Moscow - later on.

"I believe Ukraine has to not only be an EU member but also a Nato member. It would be a strong guarantee against Russia's future intentions”, he told the BNS news agency.

"If, earlier, people [in Ukraine] were divided in their opinions [on Nato membership], Russia's actions have changed it, including in the country's eastern regions”.

With the EU on Monday pledging an extra €125 million for producers hit by the Russian food embargo, the German central bank noted the EU-Russia chill is holding back Europe’s economic recovery.

“Geopolitical tensions in eastern Europe owing to the Ukraine conflict as well as in other parts of the world are now appearing to weigh more heavily on corporate sentiment”, it said in a regular report.

“It is striking that the downward trend in exports to Russia already started at the beginning of 2013, with the value of these exports falling by nearly one fifth by May 2014. Quite clearly, the conditions necessary for prosperous trade with Russia began worsening some time before the Ukraine crisis".