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Cablegate: Saarland Minister President Optimistic About The

This record is a partial extract of the original cable. The full text of the original cable is not available.

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.

----------------------------------------
Saarland's Economy: Still Steaming Ahead
----------------------------------------

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.

--------------------------------------------- -----
German-American Relations, Sister-State with Utah?
--------------------------------------------- -----

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.

--------------------------------------------- -------------
Mueller's Political Outlook and his Relationship with Koch
--------------------------------------------- -------------

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

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