US embassy cable - 03FRANKFURT2451

UNCLAS SECTION 01 OF 02 FRANKFURT 002451 
 
SIPDIS 
 
SENSITIVE 
 
DEPT FOR EUR/AGS AND EB 
 
E.O. 12958: N/A 
TAGS: ECON, PGOV, GM 
SUBJECT: SOUTHWEST GERMANY ECONOMIC AND POLITICAL NEWS 
 
1.   (U) Summary: This is the first in a series of monthly 
cables planned to summarize political and economic events in 
ConGen Frankfurt's consular district.  End summary. 
 
Political News 
-------------- 
 
2. New Hesse Cabinet: Corts and Gruettner on the Rise 
 
(SBU) Roland Koch named the ministers of his new cabinet on 
February 24.  The number of ministries inreased from nine to 
ten by dividing portfolios previously under one minister. 
Three of the ministers are new.  The Lord Mayor of Fulda 
Alois Rhiel will be the new Economics Minister.  The very 
popular local politician has an economic background and 
belongs to the progressive wing of the CDU known for 
creative ideas and reaching out to non-traditional partners 
such as environmental groups.  His main issue will be 
Frankfurt airport expansion, planned for 2006.  Minister of 
Higher Education, Science and Culture, and Frankfurt CDU 
chief Udo Corts replaces outgoing FDP chairwoman Ruth 
Wagner.  Corts is seen as a potential successor to Minister- 
President Koch.  Former CDU parliamentary manager Stefan 
Gruetter represents the Hesse CDU's conservative wing. 
Gruettner takes over the State Chancellery from Jochen 
Riebel, and has the important task of coordinating Koch's 
policies among the other ministries. 
 
3. Upcoming Visits to Washington by German Officials 
 
(SBU) Hesse Minister-President Koch (CDU) plans a visit to 
Washington D.C. May 13-15, and if his schedule permits, will 
also travel to Hesse's partner State Wisconsin.  Koch has 
requested Consulate assistance in setting up meetings.  He 
plans to focus on international issues.  Koch is positioning 
himself as a national CDU player in his ambition to be CDU 
chancellor candidate in 2006.  Interestingly, he announced 
his visit while Angela Merkel was in Washington. 
 
Baden- Wuerttemberg Economics Minister Dr. Walter Doering 
will also visit the U.S. this year.  We are gathering 
details. 
 
4. Alexander von Stahl Joins Baden-Wuerttemberg FDP 
 
(SBU) Alexander von Stahl, the former Federal Prosecutor, 
who was released from office in 1993, has joined the B-W 
FDP.  Von Stahl is a controversial figure.  He moved from 
Berlin to Ettlingen, a small community south of Karlsruhe 
and is now a member of the Ettlingen FDP chapter.  The 
Chairman of the Ettlingen FDP is Rudolf Doering, the brother 
of FDP State Chairman and Economics Minister Walter Doering. 
Von Stahl has already established contact with Stefan Havlik 
and Dietmar-Dominik Hennig, two members of the Ulm FDP who 
made headlines last year by publicly supporting Juergen 
Moellemann's criticism of Jewish leaders.  Von Stahl is also 
in touch with Hans-Manfred Roth, the former ultra- 
conservative chairman of the Bad Cannstatt FDP who caused a 
stir by inviting Austria's  Joerg Haider to speak in 
Stuttgart. 
 
5. Stuttgart Islamic Experts Group Concerned About Islamic 
Fundamentalist Links to German Extremist Groups 
 
(SBU) The Stuttgart "Islamic Experts Group" of the Baden- 
Wuerttemberg State Office for the Protection of the 
Constitution, founded in 1997, has gained more importance 
since 9/11.  The unit consists of 35 experts who are fluent 
in several Arab languages, screen Internet pages, Arab 
papers and Arab TV programs.  Landolin Mueller, chief of the 
group, states that Internet messages are difficult to 
interpret when dialects come into play.  Hidden messages 
contain intense hatred against Israel and the U.S.  Hatred 
and attacks against the U.S. are in most cases legitimized 
with quotes from the Koran.  Mueller notes the number of 
militant Islamic fundamentalists is increasing but 
infiltration of fundamentalist circles is extremely 
difficult.  Mueller is concerned about the Internet linkage 
between different militant groups and the fact that these 
circles seek loose ties with right and left wing extremist 
groups in Germany.  Their hatred of the U.S. binds them. 
 
Economic News 
------------- 
 
6.  Paris Overtakes Frankfurt Airport in Number of 
Passengers 
 
(U) Paris Charles de Gaulle overtook Frankfurt Airport in 
2002 with the largest number of passengers in continental 
Europe.  According to figures released by the Board of 
Airlines in Germany (BARIG) on March 20, Paris had 48.4 
million passengers, while Frankfurt had 48.2 million. 
Frankfurt is still Europe's number one cargo airport.  1.5 
billion tons of freight were transported through Frankfurt, 
but Amsterdam and London-Heathrow are catching up.  The 
announcement renewed calls by Frankfurt Airport Executives 
for the speedy construction of a new runway at Frankfurt 
Airport. 
7. Regional Airports in Southwest Germany Losing Passengers 
 
(U) The Stuttgart Airport owns over 60 percent of the 
regional Baden Airport in Soellingen (between Karlsruhe and 
Baden-Baden), a former military airport.  In order to keep 
the status of "regional airport," investments up to 200 
million Euro will be necessary.  Georg Fundel, Managing 
Director of the Stuttgart Airport, is under pressure from 
the B-W State Government to make such a financial commitment 
despite declining passenger numbers at smaller regional 
airports. During a meeting with Consul General, Fundel made 
clear that he has no intentions to invest the 200 million 
Euro and called the Soellingen airport "a stillborn child". 
Given a choice, Fundel would rather close the airport than 
invest the money.  In light of the current downturn in the 
airline industry, all civilian airports in Baden- 
Wuerttemberg are reporting lower numbers.  In 2002, the 
Stuttgart airport, for example, lost 900,000 passengers, a 
drop of 10 percent compared to the peak year of 2000. 
 
8. Saarland Has Low Unemployment, New Focus on Automotive 
Sector 
 
(U) Saarland, the smallest German state, has the lowest 
unemployment.  In 1999, Saarland was number eleven in 
Germany, today it is number five with 9.9 percent. 
Unemployment rose 4.7 percent in January compared with 
December. (The national average was 10 percent.)  Saarland 
also showed the biggest jump in growth in Germany with 1.2 
percent (Germany average: 0.2 percent).  The growth is 
attributed to successful economic development initiatives 
and a shift away from steel and coal towards automotive 
supply industries. 
 
9.  German Customs Catch Tax Evaders at Swiss Border 
 
(U) In 2002, customs officers of the Singen customs office 
have confiscated 1 billion Euro during random checks of 
vehicles at the German-Swiss border.  According to German 
customs officials Germans from all professions bring cash 
over the 283-kilometer-long border to Switzerland to avoid 
German taxes.  47 million travelers and 20 million cars pass 
through the 24 border checkpoints each year.  The Stuttgart 
IRS office alone was able to collect an additional 9.3 
million Euro in 2002 due to the findings of the customs 
officials. 
 
10.  IBM Germany Has New CEO 
 
(U) Walter Raizner is the new CEO of IBM Germany.  He 
succeeds Erwin Staudt who was appointed Chairman of the 
Supervisory Board.  Raizner expects a difficult year for IBM 
Germany, with IT markets shrinking by 1.7 percent. 
 
11. Zeiss Loses Money, Lays Off Workers 
 
(U) The Optics Company Carl Zeiss announced that it will 
have to cut 200 jobs at its headquarters in Oberkochen, a 
sharp decline from its 2002 growth, which created 500 new 
jobs.  During the first four months of the new business year 
(which started October 1, 2002), turnover dropped by nine 
percent. 
 
12. DaimlerChrysler's Profits Improve 
 
(U) DaimlerChrysler reported a 6.8 billion Euro operating 
profit for the year 2002.  The Mercedes Car Group 
contributed the largest growth, with an operating profit of 
3.02 billion Euro and the Chrysler Group with 1.3 billion 
Euro.  DaimlerChrysler's problem division is trucks and 
vans, with a loss of 343 million Euro.  For the year 2003, 
DaimlerChrysler CEO Juergen Schrempp is worried about 
profits.  The global economic situation and international 
tensions may have a negative impact on growth. 
DaimlerChrysler is in 100 countries. 
 
BODDE