NETHERLANDS/IRAN: HALTING EXPORT CREDITS

C O N F I D E N T I A L SECTION 01 OF 02 THE HAGUE 000121 SIPDIS SIPDIS STATE FOR EB/IFD/ODF, EB/IFD/OMA STATE ALSO FOR EB/ESC/TFS, EUR/UBI, IO/T PARIS ALSO FOR OECD TREASURY FOR IA/OFFICE OF TRADE FINANCE E.O. 12958: DECL: 01/23/2017 TAGS: PREL EFIN MNUC EXIM UNSC OECD NL SUBJECT: NETHERLANDS/IRAN: HALTING EXPORT CREDITS REF: A. STATE 4760 ¶B. THE HAGUE 106 ¶C. THE HAGUE 94 THE HAGUE 00000121 001.3 OF 002 Classified By: ECONOMIC COUNSELOR KAREN ENSTROM, REASONS 1.4 (B) AND (D) ¶1. (C) Ambassador delivered ref A points on halting export credit insurance for Iran to Dutch Finance Minister Gerrit Zalm on January 17. Minister Zalm told the Ambassador the Netherlands was fully committed to implementing UNSCR 1737 but was not prepared to halt export credits for Iran. EconCouns had also shared and discussed points on January 16 with Nicole Bollen, Coordinator for International Financial Issues at the Ministry of Finance (MOF) and Dutch representative to the Paris Club and OECD Export Credits Group. Per refs B and C, Emboffs discussed the issue separately with Ministry of Foreign Affairs (MFA) officials prior to the January 22-23 GAERC. ¶2. (C) On January 22, EconCouns followed up with Bollen and Martin Masselink, also from the MOF Office of International Financial Issues. These officials explained that the GONL was not willing to act unilaterally on this issue but preferred a multilateral approach. Nonetheless, Bollen said export credit insurance through the Dutch export credit agency (ECA) Atradius was already "limited and restrictive" and subject to strict due diligence procedures. Within a maximum credit exposure ceiling for Iran of 1.5 billion euros ($1.9 billion),Masselink said only 1 billion euros ($1.3 billion) of older and outstanding loans and guarantees currently existed. He clarified that all new issuances of export insurance credit would be subject to a case-by-case assessment and approval by the MOF. Masselink also shared on a close-hold basis that the GONL had recently put in place an individual cap of 25 million euros ($32 million) on any new cases. ¶3. (U) Dutch-Iran Trade Estimated Total Dutch Exports to Iran (Thousands of U.S. Dollars) -------------- 2004 $641,154 2005 $945,206 2006 (Jan-Oct) $766,654 Top Dutch Exports to Iran (2005) (Thousands of U.S. Dollars) -------------- Mineral fuels $345,161 (incl processed) Machinery and $196,828 transport equipment Chemical products $190,987 Estimated Total Iranian Exports to the Netherlands (Thousands of U.S. Dollars) -------------- -------------- 2004 $684,311 2005 $1,102,330 2006 (Jan-Oct) $1,303,235 THE HAGUE 00000121 002 OF 002 Top Iranian Exports to the Netherlands (2005) (Thousands of U.S. Dollars) -------------- Mineral fuels $1,009,141 (incl processed) Chemical products $28,101 (source: Dutch Central Bureau for Statistics) ARNALL