US embassy cable - 02FRANKFURT11411

UNCLAS SECTION 01 OF 02 FRANKFURT 011411 
 
SIPDIS 
 
DEPT FOR EUR/AGS AND INR/B 
 
SENSITIVE 
 
E.O. 12958: N/A 
TAGS: PGOV, ECON, ETRD, BEXP, GM 
SUBJECT: SAARLAND MINISTER PRESIDENT OPTIMISTIC ABOUT THE 
FUTURE OF THE STATE 
 
1.  (U) Summary: On December 4, Consul General Peter Bodde 
met with Saarland Minister-President Peter Mueller (CDU) in 
Saarbruecken.  Mueller is a moderate, up-and-coming CDU 
leader, and ally of Angela Merkel.  Mueller said the auto 
industry has replaced coal and steel as the most important 
industry in the state.  He regretted strains in the U.S- 
German relationship caused by Chancellor Schroeder.  Mueller 
is convinced that Hesse Minister-President Koch will win 
state elections in February, and pursue a chancellor 
candidacy for 2006.  End Summary. 
 
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Saarland's Economy: Still Steaming Ahead 
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2.  (SBU) In his first meeting with the Consul General, 
Saarland Minister-President Peter Mueller (CDU) warned 
against an overly negative view of the German economy.  "The 
German economy is still stronger than the French and Spanish 
combined."  Mueller cited Saarland's economic development. 
The state's nominal GDP grew 3 percent this year and 
unemployment was reduced from 52,800 in 1998 to 45,000 in 
2001.  The state has also diversified its industrial base, 
focusing more on the auto industry.  According to Mueller, 
the auto industry is now the most important in Saarland. 
Coal mining, long a major employer in the state, has no 
future.  The restructuring of the steel industry, which 
Mueller supported in proactive public statements, is a 
success story in Saarland.  One example is Saarstahl, 
Saarland's largest, which reduced its workforce from 60,000 
in the 1970s to 10,000 today and changed its focus to high- 
quality specialty steel.  As a result, the company is now 
showing a profit. 
 
3. (SBU) France is Saarland's dominant trading partner but 
Mueller emphasized the importance of American investment as 
well.  He mentioned the Ford assembly plant in Saarlouis as 
a good example.  It employs 6800 people and is Ford's most 
productive plant in the world.  However, Mueller confided in 
us that the CEO of Ford Germany told him thirty of Ford's 
suppliers are in serious trouble. 
 
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German-American Relations, Sister-State with Utah? 
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4.  (SBU) Mueller emphasized at the beginning of the meeting 
"that not all Germans think about the U.S. as Chancellor 
Schroeder does."  Mueller criticized the policies of the 
Schroeder government.  "What I don't see is a general 
concept, a strategy behind what the Schroeder government 
does," Mueller said.  He regrets recent tensions in the 
German-American relationship and wants to expand Saarland's 
ties to the United States.  His Minister of Economics, 
Hanspeter Georgi, was in the U.S. the day after the German 
elections.  In Chicago and Salt Lake City, he reassured 
German and American business representatives of the strength 
of German-American friendship.  Georgi sees Utah as a 
possible sister state for Saarland.  A memorandum of 
understanding between Saarland and Utah has already been 
signed. 
 
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Mueller's Political Outlook and his Relationship with Koch 
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5.  (SBU) Mueller plays a prominent role in the CDU as an up- 
and-coming leader.  He is seen as a moderate and a 
counterweight to the more conservative Hesse M-P Roland 
Koch.  A close ally of Angela Merkel, he did not support 
Edmund Stoiber's chancellor candidacy until very late in the 
campaign.  Mueller was also head of the CDU "immigration 
commission" which was convened to draft a new immigration 
law for Germany.  When queried about the proposed 
immigration bill now before the Constitutional Court, 
Mueller predicted the Schroeder government's draft bill will 
be declared unconstitutional.  In the end "Schily will get 
what he originally wanted: the Mueller bill." 
 
6.  (SBU) Mueller's relationship with Koch was described to 
us in a later meeting with the President of the State 
Parliament, Hans Ley.  Ley described Mueller as a close 
friend of Hesse Minister-President Roland Koch.  The two do 
"very well together."  The leader of the state's Junge Union 
(JU or CDU youth wing), Alexander Funk, agreed that while 
there was no personal animosity between Mueller and Koch, 
the two had vastly different styles. Funk described Koch as 
a "polarizing" figure and Mueller as a "bridge builder." 
However, he also acknowledged that Mueller's politics were 
probably "too liberal" for the national party and that Koch 
would most likely be the party's standard bearer in the 2006 
national elections. 
 
7. (SBU) Comment: This "new" friendship between Koch and 
Mueller (which hasn't been mentioned by our contacts in 
Hesse) may indicate that Mueller is fully aware of the 
growing influence Koch has in the CDU and is aligning 
himself with the rising star.  Mueller himself left no doubt 
that after Koch is re-elected as Minister President of Hesse 
in February 2003, he will pursue a chancellor candidacy in 
2006.  However, Mueller left his own preferences for a 
chancellor candidate unstated.  End Comment. 
 
BODDE