VZCZCXRO9711
RR RUEHAST
DE RUEHTC #1776/01 2261307
ZNR UUUUU ZZH
R 141307Z AUG 06
FM AMEMBASSY THE HAGUE
TO RUEHC/SECSTATE WASHDC 6537
INFO RULSDMK/DEPT OF TRANSPORTATION WASHDC
RUEAHLC/HOMELAND SECURITY CENTER WASHINGTON DC
RUEHBS/TSA EUR AFRICA MIDEAST RGN HQ BRUSSELS BE
RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUEHAT/AMCONSUL AMSTERDAM 1224

UNCLAS SECTION 01 OF 02 THE HAGUE 001776 
 
SIPDIS 
 
DEPARTMENT PLEASE PASS TO CODEL DUNCAN 
DEPARTMENT FOR H AND EUR/UBI 
 
SENSITIVE 
 
CODEL 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: EWWT ECON PREL PGOV OREP NL
SUBJECT:  SCENESETTER FOR CODEL DUNCAN VISIT TO THE 
NETHERLANDS, AUGUST 24-27, 2006 
 
 
THE HAGUE 00001776  001.3 OF 002 
 
 
¶1. We warmly welcome your visit to the Netherlands on 
transportation infrastructure and security issues.  The 
Netherlands prides itself as the "Gateway to Europe" for 
trade and commerce.  The Port of Rotterdam is the world's 
third largest in terms of cargo throughput.  Amsterdam's 
Schiphol airport is Europe's fifth largest in terms of 
passenger traffic and third largest air cargo hub. The Dutch 
have actively implemented several transportation and border 
security initiatives in recent years.  The Port of Rotterdam 
was the first foreign port to implement the Department of 
Homeland Security's Container Security Initiative (CSI). 
During your visit, you will visit both the Port of 
Rotterdam, where you will tour the container scanning 
facility and the Harbor Coordination Center, and Schiphol 
airport, where you will tour the baggage screening facility. 
You will also meet with the Ministry of Transportation 
Director General for Transport and Civil Aviation for an 
overview of Dutch freight and port security programs. 
 
Port of Rotterdam 
----------------- 
 
¶2. The Port of Rotterdam is the third largest in the world. 
Over 370 million tons of cargo passed through Rotterdam in 
¶2005.  Roughly 6 percent of the cargo traffic transiting 
Rotterdam goes to the U.S.  The port stretches for nearly 30 
miles and the port and industrial area covers 26,000 acres. 
If the port of Baltimore were the same size, it would 
stretch from the center of Baltimore to Annapolis. 
 
¶3. Rotterdam is Europe's largest container processing port 
(9.3 million twenty-foot equivalent containers passed 
through Rotterdam in 2005), but the majority of shipments 
are in bulk form.  Rotterdam is Europe's most important port 
for oil and chemicals, iron ore, coal, food and metals. 
Crude oil, oil products and liquid chemicals together 
account for almost half of the total cargo throughput in 
Rotterdam; five refineries are situated within the port and 
industrial complex.  Liquid oil and petroleum products are 
transported throughout Europe through a comprehensive 
network of pipelines. 
 
Port Security Initiatives 
------------------------- 
 
¶4. Rotterdam has been a leader in adopting new port security 
programs, in part to retain its competitive advantage in 
attracting shipping business.  In September 2002, Rotterdam 
became the first foreign port to sign on to the U.S. Customs 
Container Security Initiative (CSI), designed to enhance the 
security of containerized cargo destined for the United 
States.  Under CSI, a team of Customs and Border Protection 
(CBP) officers work with their Dutch counterparts to screen 
cargo manifests to identify containers that potentially pose 
a terrorist risk to the United States.  Selected U.S.-bound 
containers are scanned at the container security screening 
facility located on the Maasvlakte, at the mouth of 
Rotterdam harbor.  You will visit the Maasvlakte facility, 
where you can observe the operation of this screening. 
 
¶5. The Port of Rotterdam is currently working toward 
qualifying as the first major CBP-recognized "Trade 
Facilitation" port, which would permit clearance without 
additional security inspections of containers upon arrival 
at the U.S. port of entry.  The Dutch have also installed 
radiological portal monitors at Rotterdam, in partnership 
with the Department of Energy's Megaport/Second Line of 
Defense initiative, designed to prevent illicit shipment of 
nuclear and other radioactive materials.  The USG funded the 
installation of one set of radiological scanners; the Dutch 
have since added three more on their own.  Radiological 
scanners will be visible from the Maasvlakte during your 
visit there. 
 
¶6. Schiphol Airport, Europe's third largest air cargo hub 
and fifth largest in terms of passenger traffic, has also 
been a leader in implementing heightened security measures. 
Under the Immigration Advisory Program (IAP), four CBP 
immigration officers are assigned to Schiphol Airport to 
assist airlines with US-bound passenger screening to prevent 
boarding of individuals who may be inadmissible to the U.S. 
 
THE HAGUE 00001776  002.3 OF 002 
 
 
Since the program began in June 2004, IAP officers have made 
770 "No Board" recommendations to airlines; such 
recommendations are based on inadequate or fraudulent 
documentation, or identification of high risk passengers. 
The U.S. and Dutch governments are negotiating a pilot 
International Registered Travelers program to facilitate 
travel by low-risk passengers between Schiphol Airport and 
JFK. 
 
Political/Economic Overview 
--------------------------- 
 
Early Elections 
--------------- 
 
¶7. The Netherlands is a constitutional monarchy with a 
parliamentary form of government.  Prime Minister Jan Peter 
Balkenende's center-right coalition government collapsed on 
June 30, at the beginning of its fourth and final year in 
office, when the Social Liberal (D66) party, the smallest of 
the three coalition partners, withdrew its support. 
Balkenende continues to govern with a minority government, 
comprised of his Christian Democratic (CDA) and the 
Conservative Liberal (VVD) parties.  Parliamentary elections 
are scheduled for November 22.  The interim cabinet will 
focus on completing Balkenende's top priority: presenting a 
budget and tax plan that includes private and corporate tax 
cuts.  The Balkenende government will also continue to 
oversee the deployment of Dutch troops to Uruzgan province 
in Afghanistan, which began on August 1, and may possibly 
consider Dutch participation in the Joint Strike Fighter 
(JSF) program before the elections. 
 
Economy Strong Going Into Elections 
----------------------------------- 
 
¶9. In the remaining months before the general elections, 
Balkenende hopes to build on the government's earlier 
structural reforms, designed to increase labor market 
participation, restructure the social welfare system, 
improve the business climate, and foster greater market 
flexibility.  These reforms, and near-stagnant growth rates 
between 2001 and 2005, cost the Balkenende government 
popular support.  However, recent economic estimates show 
that the Dutch economy is running ahead of eurozone averages 
for the first time in seven years.  GDP is expected to grow 
by 2.5 to 3 percent in 2006; unemployment has fallen to 5.5 
percent.  A recent IMF report praised the Netherlands for 
implementing sound policies that have reduced the budget 
deficit and strengthened th economy but also stressed the 
need for furtherstructural reforms. 
 
¶10. The minority CDA-VVD goernment is hailing the recent 
economic upswing asa sign that their four-year strategy to 
reinvigorate the Dutch economy, begun with difficult 
structural reforms to be followed by more popular policies 
such as tax cuts in the upcoming budget cycle, has been 
successful.  Polls suggest that voters support this 
interpretation.  Until recently, the Labor (PvdA) party, the 
principal opposition party, held a comfortable lead over the 
governing coalition parties.  Due partly to the improved 
economic news and partly to PvdA leader Wouter Bos's 
controversial and complicated socioeconomic proposals, polls 
now indicate that the November elections will be a neck and 
neck race between the PvdA and Balkenende's Christian 
Democratic party. 
 
Arnall