The talks this time are dominated by the global financial crisis that has hit the economies of both Germany and Russia. Under the motto, "Ways out of the Crisis," the three-day meeting in the southern German city will bring together trade and industry representatives from both countries.

German Chancellor Angela Merkel will also meet Russian President Dimitry Medvedev on Thursday on the sidelines of the talks.

Speaking at the opening of the event in Munich on Wednesday, Bavarian Premier Horst Seehofer said his state had a strong interest in good relations between Germany and Russia because a third of all German companies active in Russia are from Bavaria.

Germany is Russia's single biggest trading partner with bilateral turnover amounting to around 43 billion euros ($60 billion) last year. Some 4,600 German firms have subsidiaries in Russia.

"The crisis makes us realize how important close cooperation between both countries is. And I think, in future we need even closer cooperation," Seehofer said. "Towards that purpose, we've created an excellent basis for trust and mutual respect in the past years."

"A new chapter of cooperation"

Much of the work of the so-called "Petersburg Dialog" is done in eight working groups across the fields of politics, business, civil society and media. The groups bring together nearly 200 representatives from Russia and Germany.

They provide impulses and ideas for projects as varied as a German-Russian youth exchange program to creating a network of experts to fight infectious diseases in both countries.

The Petersburg dialogue was first launched six years ago by former Russian President Vladimir Putin and German Chancellor Gerhard Schroeder. It's meant as an open discussion forum to lend new impetus to German-Russian relations in a wide range of sectors - from economics and politics to education and science, cultural relations and religion.

The talks are supported by both political and private-sector foundations and private businesses in Germany and in Russia, as well as the two governments.

"The Petersburg Dialog is a very good and illuminating example of what trust can achieve," Lothar de Maiziere, chairman of the dialog forum, told Deutsche Welle.

"The core of the German-Russian partnership is the cooperation in areas where our common future is decided. Namely, in questions of upholding the law, education and science, the health sector and in making effective use of energy resources," de Maiziere said. "The new dialog should thus open a new chapter of cooperation between Russians and Germans."

Civilian dialog the most important

But the Petersburg Dialog, which is held twice a year, hasn't always been smooth. In 2005, Germany criticized a law passed by then Russian President Putin that put up hurdles for non-government organizations in the country.

And last September, the talks held in St Petersburg were strained by the Caucasus conflict in South Ossetia and Georgia. The short war prompted the European Union to put its negotiations with Russia over a new Cooperation and Partnership Agreement on ice.

In such times, according to Dmitrij Suslow from the Council for Foreign and Defense Policy, a Russian think-tank, civilian dialogue is even more necessary given that government contacts can become strained.

"The civilian dialog - between companies, scientists, journalists, human right activists -- allows both sides to make their points," Suslow told Deutsche Welle. "Without this civil dialog, Russia would not be understood in Europe and will be continued to see as a danger - as a stirring Russian bear."

sp/dpa/afp

Editor: Neil King