Euro Crisis Shows Dutch Converge With Germany

[justjohn]

Euro Crisis Shows Dutch Converge With Germany

By Jurjen van de Pol - Dec 14, 2011

When it comes to fighting the European crisis, the Netherlands may as well be a part of Germany.

“The Dutch are often a mainstay for the Germans, and as such, play a bigger role than justified by their economy,” said Sylvester Eijffinger, a professor of financial economics at Tilburg University, 69 miles south of Amsterdam. It’s good for Germany because “it never wants to be accused of going it alone,” he said.

As European leaders have struggled for more than two years to tame their financial crisis, the Dutch government has sided with neighboring Germany in pushing austerity and central bank independence, underscoring differences between northern and southern Europe in seeking solutions.

In February 2010, then acting Dutch Prime Minister Jan Peter Balkenende called German Chancellor Angela Merkel to say the International Monetary Fund should help Greece solve its funding needs. The plan was opposed by French President Nicolas Sarkozy, who said it would show the European Union couldn’t solve its own crises. A month later, EU leaders went to the Washington-based IMF for aid.

“The Netherlands was much more in favor for calling in the IMF than Germany was,” said Adriaan Schout, who heads the European Studies Programme at the Clingendael Institute of International Relations in The Hague. The Dutch government sought the involvement of the IMF and its strict rules to ensure Greece would live up to its end of the bargain.
Exports to Germany

The Netherlands, the fifth-largest economy in the euro region, exported 90 billion euros ($117 billion) of goods to Germany in 2010, making up almost a quarter of total exports, compared with 32 billion euros to France, according to Dutch statistics agency CBS. Germany has the EU’s biggest economy and ranks as the world’s second-largest exporter after China.

“Trade between Germany and the Netherlands isn’t only extensive, it is enormous,” Dutch Finance Minister Jan Kees de Jager said at Berlin’s Humboldt University on May 24. “It is flourishing today thanks to the internal market and the euro. If there are two EMU countries that should logically stand together, they are Germany and the Netherlands.”

A breakup of the euro bloc would cut exports of Dutch products by 25 percent next year, ING Groep NV (INGA) economists Teunis Brosens and Dimitry Fleming said in a Dec. 6 note to clients. “As a trading nation with large pension funds and an international financial sector, we’re closely tied to the euro zone” and may be the country with the biggest interest in maintaining the currency, they wrote.
EU Summit

Moody’s Investors Service said Dec. 12 that it will review the ratings of all European Union nations after last week’s meeting of the region’s leaders failed to produce “decisive policy measures.” That followed Standard & Poor’s announcement that it may cut the ratings of 15 euro-region members because of a “reactive and insufficient” response to the crisis.

S&P’s warning of a possible rating downgrade of AAA rated Germany, France and the Netherlands comes as a “clear signal that solutions are needed,” De Jager told RTL television. German Finance Minister Wolfgang Schaeuble said S&P’s warning will spur politicians to bolster efforts to resolve the crisis.

“There are not so many differences” between the Dutch and German approach to solving the debt crisis, Dutch Prime Minister Mark Rutte told reporters in Stockholm after meeting his Swedish counterpart, Fredrik Reinfeldt, on Dec. 5. “I challenge you, you will find one or two, but it is difficult.”
Coal, Steel Accord

The German and Dutch ideals on Europe trace their roots to the establishment of the European Coal and Steel Community in 1951. Germany and the Netherlands, along with four other European countries, agreed to bring resources used for weapons production under common control in the first move that led to today’s EU with 27 member states.

Dutch pension funds and insurers sold French, Spanish and Italian bonds and bought debt of Germany, the Netherlands, Austria and Finland instead in the third quarter, the country’s central bank said today. The yield difference between Dutch 10- year bonds and German bunds narrowed two basis points to 31 basis points. The extra interest investors demand to hold French bonds instead of benchmark German bunds was at 118 basis points as of 1 p.m. in Frankfurt.
Budget Stance

“Germany and the Netherlands are on the same line when it comes to automatic sanctions for excessive budget deficits and preventing the European Central Bank from losing its independence,” said Schout, who served as an independent expert to the European Commission.

They weren’t always on the same page when it came to budget rigor. The Dutch defeated a proposed European constitution in a 2005 referendum amid public disagreements over a successful Franco-German bid to loosen deficit rules.

While the Germans and Dutch succeeded in drafting the IMF to shore up Greek state finances and bring France to pledge to semi-automatic budget sanctions, they gave in to Sarkozy’s demand to remove specific bondholder-loss provisions in the treaty for the European Stability Mechanism.

“Sarkozy came out as the winner and managed to get rid of private-sector involvement, something the Netherlands has supported,” Schout said. “That’s typical for the Dutch position. They are keenly involved in the preparations, but when the match starts, it’s between Germany and France.”
Leadership Role

French Budget Minister Valerie Pecresse said France and Germany need to play a leadership role in the euro.

“Given the number of countries in the euro zone and given their different situations, it’s essential to begin with a French-German agreement,” Pecresse said Dec. 7 at a press conference in Paris.

While France also is among the six founders of the European Union, a visit to Berlin usually takes preference over a trip to Paris for newly inaugurated Dutch prime ministers.

“France is culturally further removed from the Netherlands than Germany so the Dutch influence there is bigger than among the French,” said Eijffinger, the Tilburg University professor who is also a member of the Monetary Experts Panel of the European Parliament.

To contact the reporter on this story: Jurjen van de Pol in Amsterdam at [e-mail].

To contact the editor responsible for this story: James Ludden at [e-mail].

[pieter]

John,

It is true that the Netherlands is monetary linked to Germany, and that has roots in the historical Gulden-Mark connection before the EURO came to being. The Netherlands shares the largest Eastern-border with Germany and Germany is one of the most important trade partners. The Netherlands is one of the world's 10 leading exporting countries. Foodstuffs form the largest industrial sector. Other major industries include chemicals, metallurgy, machinery, electrical, goods and tourism. Examples include Unilever, Heineken, financial services (ING), chemicals (DSM), petroleum refining (Shell), electronical machinery (Philips, ASML) and car navigation TomTom. Next to this there is a huge tourist industry on both sides of the border. Germans love the Netherlands. They have vacation houses at the Dutch North sea coast, they love the Dutch countryside and cities. And more and more Dutch tourists are going to Germany. The Germans export their cars, machines and equipment to the Netherlands and the Dutch export foodproducts, chemical and petrol products to Germany and high tech.

















Economy of the Netherlands

On the Index of Economic Freedom, the Netherlands is the 15th most laissez-faire capitalist economy out of 157 surveyed countries. At the time of writing the Netherlands is the 16th largest economy of the world. (see: List of countries by GDP (nominal)) Between 1998 and 2000 annual economic growth (GDP) averaged nearly 4%, well above the European average. Growth slowed considerably in 2001-05 as part of the global economic slowdown. 2006 however, showed a promising 2.9% growth. Yearly growth accelerated to 4.2% in the third quarter of 2007. Inflation is 1.3% and is expected to stay low at about 1.5% in the coming years.

Trade and investment

The Netherlands, which derives more than two-thirds of GDP from merchandise trade, had strongly positive balance of payments for 2005 estimated at €31.5 billion. Leading export markets (2005) are Germany with 25.1%, Belgium with 12.2% and the United Kingdom and France with both 9.4%. Leading suppliers (2004) are Germany (17%), Belgium (9.4%), China (8.8%) and the United States (7.8%). As becomes clear from these figures, Germany is by far the most important trading partner of The Netherlands.
Leading foreign investors in the Netherlands (2005) are the United States with 18.5%, the United Kingdom (14.1%), Germany (12.0%) and Belgium (10.1%).

The Netherlands' location gives it prime access to markets in the UK and Germany, with the port of Rotterdam being the largest port in Europe. Other important parts of the economy are international trade (Dutch colonialism started with cooperative private enterprises such as the VOC), banking and transport. The Netherlands successfully addressed the issue of public finances and stagnating job growth long before its European partners. Amsterdam is the 5th busiest tourist destination in Europe with more than 4.2 million international visitors.

The old currency, the Gulden

Guilder is the English translation of the Dutch gulden — from Old Dutch for 'golden'. The guilder originated as a gold coin (hence the name) but has been a common name for a silver or base metal coin for some centuries. The name has often been interchangeable with florin.
The guilder was used most in the Netherlands (as the Dutch guilder), until it was replaced by the euro on 1 January 2002. The Netherlands Antillean guilder is currently the only guilder which is in use, which after the dissolution of the Netherlands Antilles remained the currency of the new countries Curaçao and Sint Maarten and (until 1 January 2011) the Caribbean Netherlands.
One-and-a-half guilder was called a daalder (see thaler); two-and-a-half guilder was called a rijksdaalder. The word daalder/thaler is the origin of dollar.

en.wikipedia.org/wiki/Netherlands_Authority_for_the_Financial_Markets

[pieter]

Dutch Central Bank DNB forecasts: Economy coming to a virtual halt

Press release
Date 9 December 2011

The Dutch economy will come to a virtual halt next year. GDP growth will fall to 0.2% and unemployment will rise to 5.3% in 2012. However, economic developments depend on the course of the European debt crisis. If the crisis is tackled quickly and decisively, a restoration in confidence may give the economy a positive boost, according to the new half-yearly forecast by DNB published today.

Growth in Dutch GDP (gross domestic product) over 2011-2013 will be much lower than expected a half-year ago. DNB foresees growth of 1.4% in 2011, but in the second half of this year the economy enters a technical recession (two quarters with negative growth). In 2012 growth will dwindle to almost nothing (0.2%). GDP growth may subsequently pick up cautiously to 1.3% in 2013. Unemployment will rise to 5.3% next year and to almost 6% in 2013.

The more sombre growth prospects result from the lower growth in world trade and the increased loss of confidence among enterprises and consumers. Households tend to save more because their financial situation is deteriorating, notably through declining house prices.

The government deficit will first improve from 4.4% of GDP in 2011 to 3.5% of GDP in 2012. However, the downward economic cycle will depress government revenues, contributing to a widening of the deficit in 2013 to 3.7% of GDP. This will bring it above the signal margin that triggers extra austerity measures under the budgetary rules.

The indefinite outcome of the European debt crisis generates extremely large uncertainties. The basic assumption underlying this forecast is that the debt crisis will be resolved in due course without major shocks. A disorderly resolution to the crisis is conceivable, but this is not covered by the usual models and scenario’s that are used in these half-yearly forecasts. Decisions that are crucial for the functioning of EMU will be made shortly. If the debt crisis is tackled quickly and decisively, a restoration in confidence may already give the economy a positive boost next year.

[karl]

I think perhaps Pieter has best described of the closeness of our two systems and mainstay financial partners in both trade exchange and between our two peoples.

It is true, most of us do enjoy friendships with the Dutch in their land. I think it is because we are more close in our respective habits and conditions of climate and living. For as of our selves {North Germany}, we are each a sea going peoples with closeness to our mother the sea.

Another closeness, is our shared form of Capitalism {Rhineland Model}. With this, a shared expectations of responsibilities in manner of finances and banking: The following url is exampled description of models Rhineland and Anglo-Saxon.

www.ser.nl/en/publications/speeches%20chairman/2009/20090514.aspx

Another example of trade closeness is the capability and capacity of the various deep water access ports of the Netherlands. For in conjunction with port facilities on our side, it is of relative ease in shipping planning between our two sides. For once shipped in and for out shipping, it is primarily over land transport to customers domestic, foreign and to our east. For in doing so in land transport, it is vital of a strong infrastructure of dependable hard surfaced roadway. In this manner, is shared between us.

The Dutch are very dependable in manners of planning and security of off loaded containers that are the standard of shipping. Once those containers are off loaded, the seals are checked at their ports, then rechecked upon our acceptance and rechecked once again upon leaving our borders as east bound.

The above is of course commensurate with commerce. It is people that are the key to communication and living. Perhaps as Pieter has very well described, we are a close people. The Dutch are a proud peoples, and most of all, they are human with a shared warmth of friendliness.

Karl

[pieter]

Dec 15, 2011 6:32:22 GMT -7 karl said:

I think perhaps Pieter has best described of the closeness of our two systems and mainstay financial partners in both trade exchange and between our two peoples.

It is true, most of us do enjoy friendships with the Dutch in their land. I think it is because we are more close in our respective habits and conditions of climate and living. For as of our selves {North Germany}, we are each a sea going peoples with closeness to our mother the sea.

Another closeness, is our shared form of Capitalism {Rhineland Model}. With this, a shared expectations of responsibilities in manner of finances and banking: The following url is exampled description of models Rhineland and Anglo-Saxon.

www.ser.nl/en/publications/speeches%20chairman/2009/20090514.aspx

Another example of trade closeness is the capability and capacity of the various deep water access ports of the Netherlands. For in conjunction with port facilities on our side, it is of relative ease in shipping planning between our two sides. For once shipped in and for out shipping, it is primarily over land transport to customers domestic, foreign and to our east. For in doing so in land transport, it is vital of a strong infrastructure of dependable hard surfaced roadway. In this manner, is shared between us.

The Dutch are very dependable in manners of planning and security of off loaded containers that are the standard of shipping. Once those containers are off loaded, the seals are checked at their ports, then rechecked upon our acceptance and rechecked once again upon leaving our borders as east bound.

The above is of course commensurate with commerce. It is people that are the key to communication and living. Perhaps as Pieter has very well described, we are a close people. The Dutch are a proud peoples, and most of all, they are human with a shared warmth of friendliness.

Karl

Karl,

Well said, you descibed it well. Yes, also the personal relationships between the Dutch and Germans are better, because the present Dutch generations have a positive feeling about the present Germany. The Dutch love for instance the German cities and towns just over the Dutch Eastern border to go shopping, to go out and for culture (museums, galleries and exhibitions). I am talking about Münster, Dortmund, Essen, Krefeld, Düsseldorf, Köln and Aachen. And *there is a increasing group of Dutch people who like to leave their densly populated country and live on the other side if the border in Germany, where there is more space, and larger houses. In the same time a lot of German students study and live in Dutch cities and towns. University students and students of university of applied sciences and Institutes of technology. You have German entrepreneurs and creative Germans in the Netherlands. Painters, sculpturists, graphical designers, fashion designers, musicians, dancers, lawjers, scientists and other kind of people. There are quite a few succesful Dutch-German marriages and/or relationships. Maybe a quarter of my friends is half German-half Dutch or German. These people are fluent Dutch speaking, integrated/assimilated people with Dutch or German names. That they have a German accent isn't a handicap. Sometimes people find it charming and sometimes there can be a sort of mild mockery, or these people can get the question "are your German", or "you have a German kind of name" or "you look German" if they look German. Sometimes you can see the differance between Germans and Dutch people. I don't know how to describe it? Maybe Germans are more strict and decent, more rules and laws oriented, and the Dutch more easy going and direct (sometimes too direct). Ofcourse the Dutch also like to work, live and study in our Southern-neighbour country, Belgium or better said Flanders. And there are also Dutch-Flamish love relationships and marriages, bu I think more Dutch-German love relationships.
It may sound strange, but like Karl said the Dutch (Northern, Protestant and secular) culture is more close to North-Germany than Flanders, which has a more Southern culture which is maybe closer to the French, Spanish and Italian culture. We speak the same language and love Flanders and the Flemish people, but they are differant and have a different lifestile, mentality and culture. That's maybe because we love them and their cuisine, cities and hospitality.

Ofcourse Germans are different too, but we share a language group, climate, economical system, Protestant soberness, a technological based society, old trade traditions and our sport culture (Football/soccer, hockey, tennis, athletics and etc.)

Cheers,
Pieter

- Dutch don't like to be called Germans or be seen as a Germanistic people, with a German dialect. That has deeper layers, because they are different. You see that in mixed families with a Dutch father and German mother for instance. Often these people - my friends - mix the best elements of Dutch and German culture. Mostly they are just Dutch because their German mother became Dutch and was or is totally assimilated/integrated. There even was a plan in the ninetees of Dutch authorities to import East-Germans, train them in Dutch, and in that way create New Dutch people. A crazy idea, I couldn't believe my eyes when I read that report or essay about it.

* The same thing is happening in East-Germany where Polish and Czechs are coming in to live there.Often these Poles cross the border to work in Poland. The same as in the Netherlands where German Dutch come back to the Netherlands to work here and at the end of the day cross the border to go home in Germany.

[pieter]

Examples of Dutch Germans:


Prince Bernhard of Orange, husbant of Queen Juliana (Bernhard Leopold Friedrich Eberhard Julius Kurt Karl Gottfried Peter Prinz zur Lippe-Biesterfeld


Prince Claus of Orange, husbant of Queen Beatrix (Klaus-Georg Wilhelm Otto Friedrich Gerd von Amsberg)


Dutch-German Artist, Anneke Ingwersen
I know here from the art scene of Arnhem. As a teenager she spend some time in Czechia and she spoke a little bit of Czech. I got to know her on a art bus trip for a week to Krakow. She is a good artist today.


Dutch-German musician, Yonga Sun
I know him from the music scene of Arnhem (but ofcourse he plays in Amsterdam, Brussels and Germany too). He is a very good drummer!


Dutch-German lawjer, Britta Kohler and parlementarian for the Dutch GreenLeft party

[kaima]

FRANKFURT — The Frankfurt version of the Occupy Wall Street movement has many of the trappings of the New York City original, including a tattered cluster of tents, a location close to the beating heart of financial power and a diverse group of activists trying to come up with a unifying demand.

But the Occupy Frankfurt encampment, spread out on the front lawn of the European Central Bank, is missing one feature of Zuccotti Park in New York: the police.

The Frankfurt authorities, who control the park in the middle of the city, have taken a tolerant attitude toward the encampment, while the activists have generally behaved themselves since taking up residence in October. As a result, there have been none of the polarizing confrontations seen in New York and other cities, much less any violence or pepper spray.

By anarchist standards, the Frankfurt activists are an orderly bunch. They have an outdoor kitchen that serves meals of donated food, a Web site and professional public relations operation, and a tent for community meetings.

“If all demonstrations went so well we wouldn’t have much to do,” said Michael Jenisch, a spokesman for the Frankfurt Ordnungsamt, or Office of Public Order, which issues permits for public gatherings and has been monitoring the Occupy Frankfurt encampment.

“If they have the staying power, they can camp there all winter,” Mr. Jenisch said. That attitude contrasts with that of the authorities in cities like New York, Oakland or Boston, where the police have evicted protesters from public space, and also with other financial centers in Europe.

In Zurich, for example, police cleared an encampment in November, arresting 31 people who resisted, according to Reuters. Earlier this month, police in London sent a letter to local businesses that appeared to link members of the Occupy movement with terrorist groups, according to the Guardian and other newspapers.

The Frankfurt encampment of about 50 tents is not exactly a picture of German order. The residents have trampled much of the small park to mud. Several sawed-off oil drums, apparently used for fires, lie about. Atop a knoll, someone has built a sculpture out of bent bicycle frames, toy dolls and empty beer bottles.

But there have been no arrests of Occupy Frankfurt activists, and residents of the camp described the local police more as allies than antagonists. A 42-year-old man who would give his name only as Jay, and said he was originally from North Carolina, described how the police had intervened when a group of rightist youths started shouting insults and trying to provoke a fight.

“The way I see it, they don’t bother, they protect,” Jay said, as rain began to drum on the plastic tarp covering the outdoor kitchen, where he was helping to serve a communal breakfast of donated bagels and peanut butter. “We have never had a problem with the police.”

Likewise, the Frankfurt police have never had a beef with the protesters, said Manfred Vonhausen, a police spokesman. “The people there have been totally calm,” he said.

The activists chose the site next to the E.C.B. to protest what they consider the bank’s aloofness from the democratic process and the austerity it is helping to impose on indebted countries like Greece. But the protesters do not seem to be very aware of the central bank’s policy actions, like its rate cut last week.

Leftist movements have a long history in Europe, and the German police are used to dealing with neo-Nazis, extreme-left “Autonomen” and other groups with much more of a hang for violence than the Frankfurt campers, who do not even rate a permanent police presence.

“The U.S.A. is not as used as the Europeans to dealing with these movements,” said a 50-year-old Occupy Frankfurt resident who would identify himself only as Uwe. He was managing an information stand fashioned from plastic tarps and wooden freight pallets, where passers-by could pick up leaflets and perhaps make a donation to help pay for portable toilets and other camp infrastructure. The protesters have been careful not to obstruct heavily traveled walkways that lead through the park from a nearby streetcar stop.

the rest of the article is at
www.nytimes.com/2011/12/16/business/global/at-occupy-frankfurt-calm-anarchy-has-staying-power.html?pagewanted=2&_r=1&hp

[pieter]

Occupy Arnhem does not like the local press