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Cablegate: Bonn-Vibrant: A Growing City After Capital Moves to Berlin

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RR RUEHAG RUEHAST RUEHBW RUEHDA RUEHFL RUEHIK RUEHKW RUEHLA RUEHLN
RUEHLZ RUEHPOD RUEHROV RUEHSR RUEHVK RUEHYG
DE RUEHDF #0025/01 1201315
ZNR UUUUU ZZH
R 291315Z APR 08
FM AMCONSUL DUSSELDORF
TO RUEHC/SECSTATE WASHDC 0142
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUCNFRG/FRG COLLECTIVE
RUEHDF/AMCONSUL DUSSELDORF 0158

UNCLAS SECTION 01 OF 02 DUSSELDORF 000025

SIPDIS

SIPDIS

E.O. 12958: N/A
TAGS: PGOV ECON GM
SUBJECT: BONN-VIBRANT: A GROWING CITY AFTER CAPITAL MOVES TO BERLIN

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Sensitive but Unclassified -- Not for Internet Distribution

1. (U) Summary: The gloom that descended upon Bonn in the wake
of the German government's 1991 decision to move the capital
back to Berlin has lifted as the city booms economically and
retains its strong international orientation. Through the
Bonn-Berlin Law and other initiatives introduced in the 1990s,
Berlin and the state of North Rhine Westphalia (NRW) have
invested enormous political and financial resources into the
city, which retains a major Federal government role and has
grown into an important site for international organizations and
commercial activity. Major education and research institutions
reinforce its impact in NRW, Germany, and beyond, although the
city retains its "small town on the Rhine" feel. The USG
presence remains very small and is scheduled to be phased out:
the "Little America" so well known (and loved) by so many
Bonners, Americans and others is just a memory, but the city's
future is bright. End Summary.

--------------------------------------
Resurgence as the "Federal City of Bonn"
--------------------------------------

2. (U) Many residents of Bonn and the surrounding area thought
June 20, 1991 was the city's death sentence. On that day, the
Bundestag decided to return the seat of government to Germany's
capital, Berlin. Many believed Bonn's major role on the federal
and international stage would slowly decline, and pessimists
even predicted it would die. Since then, however, Bonn has
enjoyed an average growth rate of about 6%, more than double the
national average and the city is booming. Although the
Bundestag and Chancellery moved, national legislation (the
"Bonn-Berlin Law" of 1994) ensured the city's future relevance,
prescribing the "permanent and fair division of labor between
the Capital City of Berlin and the Federal City of Bonn" and
spelling out that six Federal Ministries (Defense; Development
Aid; Education and Research; Environment; Health; and Food and
Agriculture) would maintain their headquarters in Bonn. In
addition, all other Federal Ministries have major offices in
Bonn (i.e. Ministry of Interior, Finance, Labor, etc) and
several key federal agencies (BaFin; Federal Audit Office;
Regulatory Agency for Network Industries (telecoms) and energy)
are headquartered in the city. In fact, Bonn currently boasts
about 1,000 more federal employees than Berlin.

---------------------
Bonn Businesses Boom
---------------------

3. (U) Since 1991, more than eighty major firms have moved to
Bonn, creating some 20,000 new jobs. Three of the German DAX 30
firms (Deutsche Post, Deutsche Postbank and Deutsche Telekom)
have their headquarters in Bonn. There were many reasons why
these companies chose to base themselves there: the city's
international and political expertise, its quick access to three
international airports, and great high-speed train and road
networks. Perhaps most importantly, various levels of
government invested some 256 million Euros in the city's
infrastructure and transport connections, as Berlin and the
state of NRW kept their commitments to support Bonn's
transformation. Meanwhile, population growth has remained
positive and purchasing power is about 14 percent above the
national average, according to recent studies. Unemployment is
1.7 percentage points under the national rate of 9.0 percent
(2007 figures). Many companies use Bonn's reputation for high
quality of life to attract professionals. One 2007 study (by
ECA International, a major international HR network), ranked
Bonn number one in Germany and number five in the world, in
terms of environment, infrastructure, public health, social
networks, personal security, and educational opportunities.

-----------------------------------
A Center for International Dialogue
-----------------------------------

4. (U) Bonn, with strong support from the NRW government and
Berlin, has put enormous emphasis on remaining an international
city, and used a variety of means, such as financial and other
incentives and political lobbying, to attract UN agencies and
other NGOs. Seventeen UN offices are now located in Bonn,
including the UN European Center for Climate Change and a key
World Health Organization branch. Five UN offices alone have
opened in Bonn in the last five years. The former Chancellor's
office is slated to become the seat of the UN Climate
Secretariat (UNFCCC) in late 2008. Major efforts have been made

SIPDIS
to attract important international events, including the first
UN Conference on Afghanistan in 2001 and its follow-on in 2003.
In May, some 5,000 delegates and 75 environment ministers will
descend upon Bonn for the UN Conference on Biodiversity. In
fact, the number of total conference participants in Bonn jumped
from 50,000 in 2006 to 60,000 in 2007, and the city's goal is
200,000 in 2011. The new "World Conference Center" scheduled to

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open in 2009 will have a capacity of 5,000 and support 2,000 new
jobs. The center is being built in coordination with the UN
Congress Center (UNCC), a Korean-American joint venture to
transform the former Bundestag into a center for international
conferences, trade shows and other meetings. One in seven
residents of the city has a foreign passport.

-------------------------
Home to Educational Elite
-------------------------

5. (U) The wide range of educational opportunities helps Bonn
form an important part of the ABCDE region in Germany (Aachen,
Bonn, Cologne, Duesseldorf/Duisburg/Dortmund and Essen), which
reportedly has the highest concentration of educational
institutions in Europe. Bonn city officials boast the city has
the highest percentage of citizens with a university degree in
Germany (19 percent, well above the national average of 9
percent). The University of Bonn, with over 30,000 students,
enjoys an almost two-hundred year reputation as one of Germany's
most prestigious universities. The city is also home to many
major student exchange programs that involve the United States.


6. (U) Bonn has also become an increasingly important center
for science and technology. Research and educational
institutions have received 820 million euros in the past ten
years as a part of the Berlin/Bonn law to balance the transfer
of government. The Center for Advanced European Study &
Research (CAESAR) was founded in 1995 as a part of this
initiative and has become a leading research institute for
physics, nanotechnology, and biotechnology. Other important
institutions in the Bonn area are the Center for European
Integration Studies (ZEI), and the Center for Development
Research (ZEF). The ingenuity of the region is reflected in the
fact that almost 20 percent of all patents in Germany in 2006
came from this region. The Bonn International Center for
Conversion (BICC), a well-respected organization devoted to
promoting peace through the transformation of military-related
institutions and encouraging disarmament, is also located in the
city.

------------------------
"Little America" No More
------------------------

7. (U) The former large American presence in Bonn has now
nearly disappeared. With the exception of a small U.S. Embassy
Office in Bonn known as the Defense Liaison Office (DLO), with
an FAS representative, USG offices followed the German
government's move to Berlin. The former Ambassadors' residence
as well as the American housing project, known locally as
"Little America" have been sold to private German owners. The
former Embassy and housing compound have been refurbished and
are now very desirable real estate. The former DOD School is
the Bonn International School (BIS), with a very good
reputation, educating 515 students from fifty-five different
countries from grades pre-K-12. The former Chancery is now the
headquarters of the German Federal Agency of Agriculture and
Food Affairs and also contains German defense offices. The
small DLO primarily handles liaison work with the German
Ministry of Defense and the numerous subordinate headquarters
offices and agencies located in and around the cities of Bonn,
Koblenz and Cologne, but is slated to move to Berlin in the next
few years. The famous American Club and its shopping center, a
social hub of Bonn during its days as capital, have been sold
and no longer exist. The landmark Stimson Memorial Chapel,
which was presented to the city of Bonn as a gift by President
Clinton in 1999, is a protected historic landmark and still
hosts several American worship services each week and is now
known as the American Protestant Church (APC) to the Bonn
community.

-------
Comment
-------

8. (SBU) Bonn's transition has not been without pain and would
not have been possible without massive financial and political
support from Berlin and NRW. What the city has lost in
influence and power because of the move of the German capital to
Berlin, it has retained in the business, educational, scientific
and international organization sectors. The NRW government and
a powerful "Bonn lobby" in Berlin are determined that the city
remains a major national and international location in the
region, in Germany, and beyond. Although the city still has a
decidedly "small town on the Rhine" feel and the "Little
America" so well known (and loved) by so many Bonners, Americans
and others is just a memory, its future seems guaranteed and
bright.

9. (U) This cable has been coordinated with Embassy Berlin.
BOYSE

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