Identifier
Created
Classification
Origin
09BRUSSELS497
2009-04-03 06:33:00
UNCLASSIFIED
Embassy Brussels
Cable title:  

CHARGE'S VISIT TO MONS, BELGIUM

Tags:  PGOV PREL ECON ETRD EINV BE 
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RUEHLN RUEHLZ RUEHNP RUEHPOD RUEHROV RUEHSK RUEHSR RUEHVK RUEHYG
DE RUEHBS #0497/01 0930633
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FM AMEMBASSY BRUSSELS
TO RUEHC/SECSTATE WASHDC 8800
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE
UNCLAS SECTION 01 OF 02 BRUSSELS 000497 

SIPDIS

STATE FOR EUR/WE

E.O. 12958: N/A
TAGS: PGOV PREL ECON ETRD EINV BE
SUBJECT: CHARGE'S VISIT TO MONS, BELGIUM

UNCLAS SECTION 01 OF 02 BRUSSELS 000497

SIPDIS

STATE FOR EUR/WE

E.O. 12958: N/A
TAGS: PGOV PREL ECON ETRD EINV BE
SUBJECT: CHARGE'S VISIT TO MONS, BELGIUM


1. Summary: On March 30 Embassy Brussels Charge traveled
with Embassy officers to the town of Mons in the Belgian
province of Hainaut. Mons is a major town in the
French-speaking Wallonia region of Brussels. The Charge met
with the Governor of Hainaut Province, a city councilman of
Mons, and the management of a U.S. company operating near
Mons, Dow Corning. He also spoke to a group of about 150
students at the University of Mons-Hainaut. Mons is one of
the most economically depressed areas of Belgium, with
unemployment likely exceeding 20 percent, a large Muslim
population, and very limited, if any, government efforts to
facilitate integration or prevent radicalization. U.S.
businessmen operating there are pessimistic on a return to
economic growth before 2010, based on sales of a product that
serves as a leading economic indciator. End Summary.

PROVINCIAL GOVERNMENT
--------------


2. Claude Durieux, Governor of Hainaut Province, told Charge
that the province has a special connection with the United
States because of the presence of SHAPE, NATO's military arm,
and the U.S. Air Base at Chievres. Durieux said the area
hosts about 3000 U.S. service members and their dependents
all told. The two military installations contribute
significantly to the local economy. The city of Mons and the
province make it a point to welcome and give an orientation
tour to the spouses of newly-assigned service members.


3. Durieux said that the historical basis of Hainaut's
economy was coal and steel production, but that the province
went into a crisis in the early 1960's as those industries
became uneconomical. One major handicap cited by Durieux is
lack of English language capabilities among workers.
However, EU assistance is helping to strengthen the
University in Mons and addressing that problem. The
provincial government has established a "one stop shop" for
licenses and permits to make starting a business easier. It
provides some incentives for new businesses that vary
depending on the number of jobs created. Also, he said, the
government has created an "enterprise zone" and is happy to
have U.S. investment like the Dow Corning silicone production

plant which Charge visited later in the day. The trend is
toward new technologies, and Durieux mentioned the recent
arrival of a Google installation and an innovation center
established by Microsoft. The presence of Microsoft and
Google is attracting the attention of other computer software
companies, he said. Another advantage is the "Biopole"
created at Charleroi, the other major urban area in Hainaut,
which is focused on biotechnology industries. Nevertheless,
Durieux continued, the unemployment rate in the province
continues at a stubbornly high 20 percent. At the same time,
the technical schools, which could provide salable skills to
students, are losing favor with young people. He said that
many young people drop out of school, having seen their
parents, and in some cases their grandparents as well, live
on unemployment benefits.


4. Mons is eager to become the "European Capital of Culture"
in 2015, but it has competition from Liege for the title,
which is reserved to a Belgian town for that year. Durieux
is certain that Mons will prevail and that the honor will
bring with it significant economic benefits. Although the
governor did not mention it, the competition has created some
bitterness and bad blood between the two towns.


5. Durieux expects the regional and European elections of
June 2009 to feature some new issues, such as global warming.
Durieux is a member of the Socialist Party, but he said that
the ecologically based francophone political party, Ecolo, is
gaining adherents, and is attracting them mostly from the
Socialists. However, he said, this is not because of a
particularly high level of consciousness of ecological
issues, but because of dissatisfaction with corruption
allegations against Socialist officials, including the former
mayor of Charleroi. Trials of the Charleroi defendants will
begin shortly before the June elections. At the moment,
Socialists dominate the provincial government, with one
representative from another party, the francophone liberals
(MR). After the elections, he expects the provincial budget,
now 35 million euros, to be reduced. He thinks there will be
a new division of powers and responsibilities between the
federal government, the three regional governments and
municipalities.


6. Hainaut has a large population of Muslim immigrants.
Although Durieux was unable to point to specific government
programs to promote integration, he mentioned that a number
of non-governmental organizations exist to assist the
immigrant population.


BRUSSELS 00000497 002 OF 002


UNIVERSITY STUDENTS AND FACULTY
--------------


7. The Charge then visited the University of Mons-Hainaut,
and its Faculty of Translation and Interpretation. The
Charge presented the Embassy's film on the history of
Belgian-American relations, which was well received by the
students. He then led a discussion of U.S.-Belgium and
Trans-Atlantic relations and took questions from students for
approximately one hour. The appearance at the University was
followed by a lunch with the Dean of the Faculty, Professor
Alan Piette. Piette said that the faculty counts up to 500
students, who have good prospects for employment after
graduation as translators and interpreters in the
institutions of the European Union and elsewhere, including
the UN. When the discussion turned to politics, Piette was
surprisingly convinced that the chances of an eventual split
between Flanders and Wallonia are rather high. He laid the
blame on a "hidden agenda" among Flemish politicians in favor
of separatism. Piette believed the actual unemployment rate
in the region was much higher than the government's stated
rate of 20 percent. Despite the high level of unemployment in
Mons and Charleroi, he did not see many people returning to
the universities as adults to retrain themselves and improve
their chances for employment. There is no institutional
obstacle to returning to school, he said, but younger
students are somewhat intolerant of older, "different"
students.

MONS CITY HALL
--------------


8. The Charge then visited the city hall in Mons, where he
met Archile Salas, the city council member in charge of
Festivals and Sports. Salas said that as a child of
immigrants to Belgium from Greece, he is representative of
the diversity of the population of Mons. He showed the
Charge murals in the wedding hall of the city hall that
depict the city's famous "Doudou" festival held in June,
which attracts thousands of enthusiastic participants.

DOW CORNING
--------------


9. The Charge's last stop was to tour the factory owned by
U.S. company Dow Corning in Seneffe, on the outskirts of
Mons. The factory produces silicon for various industrial
uses. With over 600 employees, the plant is one of the
company's major manufacturing sites in Europe. Silicon is
used in construction, healthcare and household products, and
now the company is expanding into solar energy. Dow
Corning's senior management discussed the company's
challenges, including European chemicals registration
directives (REACH),high labor costs and corporate taxes, the
rapidly changing dollar/euro exchange rate, local staff
training needs and the economic downturn. The company
continues to operate in Belgium in part because of investment
incentives from the region of Wallonia, including low-cost
land, a 12 percent tax deduction on reinvested income and
subsidies of 23 percent of labor costs for R&D personnel.
The managers said that silicon is a leading indicator of
economic activity. According to their observations,
following a steep downturn in late 2008 the demand for
silicon is leveling out, indicating that the worst of the
recession may be coming to a close. However, based on their
sales, the company thought a return to economic growth before
the end of 2009 was growing increasingly unlikely. Charge
and Embassy's Senior Commercial Officer offered Embassy
assistance to the company to meet the challenges they talked
about.

BUSH
.