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Netherlands Rewritten -- October 2001 Executive Summary:
The Netherlands is a charter member of the North Atlantic Treaty Organization (NATO) Alliance, and has actively supported the collective security and peacekeeping aspects of NATO’s post-Cold War strategy. Like many other NATO members, the Netherlands has tried to balance costly defense priorities (such as professionalism, equipment modernization, and force levels) within static or shrinking defense budgets. The Royal Netherlands Navy (RNlN), and particularly it supporting industry, have actually faired quite well in this constrained budget environment. Major construction programs authorized in the Defense White Paper 1991, the Defense Priority Review 1993, and the Defense White Paper 2000 are in various stages. The De Zeven Provincien Destroyer Program is underway, with four units planned; and a new hydrographic survey ship (AGS) has commenced construction. Additionally, a second Rotterdam class landing platform, dock (LPD), and a second Amsterdam class fleet replenishment ship (AOR), and will begin construction in the middle of the decade. The RNlN also has long-term requirements to replace its eight Karel Doorman class frigates, and twelve Alkmaar (Tripartite) class coastal minehunters (MHCs). Planning for both of these programs will commence later in this next decade, with delivery in the next decade. General
Key Economic Indicators
Currency: Netherlands guilder (NLG), gulden, or florin. The Netherlands will be transitioning to the Euro for all transactions in 2002. As of 15 August 2001, 1NLG=0.453780EUR. Economic Overview: The Netherlands has a prosperous and open economy, which depends heavily on foreign trade. It is noted for stable industrial relations; a large current account surplus from trade and overseas investments; net exports of natural gas; and a unique position as a European transportation hub with excellent ports, and air, road, rail, and inland waterway transport. Dutch trade and investment policy is among the most open in the world. The Government has successfully reduced its role in the economy during the 1990s; and privatization, liberalization, and deregulation have become dominant recurring themes in the government’s economic policy resulting in six years of economic expansion. Gross Domestic Product (GDP) continues to average 4% annually, combined with falling unemployment and modest inflation. Only mildly effected by the crisis in emerging markets and a subsequent slowdown in the Euro-zone, the Dutch economy expanded by 3.7% in 1999 and over 4% in 2000, with 4% estimated growth for 2001 and modest growth for the out years. Continuous growth is largely due to Dutch economic policy that is geared chiefly towards environmentally sustainable economic growth and development by way of economic restructuring, energy conservation, environmental protection, regional development, and other national goals. Alliances and International Organization Participation: Alliances and Foreign Relations: The Netherlands abandoned its traditional policy of neutrality after World War II. The Dutch have since become engaged participants in international affairs. Dutch foreign policy is geared to promoting a variety of goals: Transatlanticism; European integration; third world development; and respect for international law, human rights, and democracy. The Dutch Government conducted a review of foreign policy main themes, organization, and funding in 1995. The document, The Foreign Policy of the Netherlands: A Review, outlined the new direction of Dutch foreign policy. The Netherlands prioritizes enhancing European integration, maintaining relations with neighboring states, ensuring European security and stability (mainly through the North Atlantic Treaty Organization (NATO) and recognizing the important role the US plays in the security of Europe), and participating in conflict management and peacekeeping missions. As a relatively small country, the Netherlands generally pursues its foreign policy interests within the framework of multilateral organizations. The Netherlands is an active and responsible participant in the United Nations (UN) system as well as other multilateral organizations such as the Organization for Security and Cooperation in Europe (OSCE), Organization for Economic Cooperation and Development (OECD), World Trade Organization (WTO), and International Monetary Fund (IMF). A centuries-old tradition of legal scholarship has made the Netherlands the home of the International Court of Justice, the Iran Claims Tribunal, the Yugoslavia and Rwanda War Crime Tribunals, the European police organization (Europol), and the Organization for the Prevention of Chemical Weapons. The Dutch are also strong advocates of European integration, and most aspects of their foreign, economic, and trade policies are coordinated through the European Union (EU). The Netherland’s postwar customs union with Belgium and Luxembourg (the Benelux group) paved the way for the formation of the European Community (precursor to the EU), of which the Netherlands was a founding member. International Organization Participation: AfDB, AG (observer), AsDB, Australia Group, Benelux, BIS, CCC, CE, CERN, EAPC, EBRD, ECE, ECLAC, EIB, ESA, ESCAP, EU, FAO, G-10, IADB, IAEA, IBRD, ICAO, ICC, ICFTU, ICRM, IDA, IEA, IFAD, IFC, IFRCS, IHO, ILO, IMF, IMO, Inmarsat, Intelsat, Interpol, IOC, IOM, ISO, ITU, MTCR, NAM (guest), NATO, NEA, NSG, OAS (observer), OECD, OPCW, OSCE, PCA, UN, UN Security Council (temporary), UNCTAD, UNESCO, UNFICYP, UNHCR, UNIDO, INITAR, UNMIBH, UNMIK, UNTSO, UNU, UPU, WCL, WEU, WHO, WIPO, WMO, WtoO, WtrO, ZC. Defense Policy and Strategy Like its NATO allies, the Netherlands has adopted its defense policy and strategy to reflect the realities of the post-Cold War Europe. Policy papers written in the early 1990s (the Defense White Paper 1991 and the Defense Priority Review 1993) reflected the demise of the Soviet Union and the dramatically reduced threat of armed conflict in Western Europe. In its place, the Netherlands embraced NATO’s new policy tenants of collective security and peacekeeping. As such, the Netherlands has been an active participant in UN and NATO collective security and peacekeeping operations in the Middle East and the Balkans. In November 1999, the latest defense white paper, Defense White Paper 2000, was released by the Dutch Government and provides the direction of the Netherlands Armed Forces (NAF) over the next decade. The white paper establishes the shape of the NAF for the first decade of the 21st Century. The original Framework Memorandum for the Defense White Paper2000 was released in late 1998, and represented the main guidelines for the final document. The Defense White Paper 2000 describes the future roles of the Armed Forces as the following:
These guidelines emphasize combat readiness, force projection, deployability, flexibility, mobility, and international interoperability. Resources that are directed towards these guidelines will have priority over those oriented against the now unlikely threat of a large-scale attack on NATO. Dutch defense policy is calling for increased cooperation between the services and other governmental organizations, both as a means of enhancing operational capabilities and as a cost-cutting measure. Like many other Western nations, service staffs are being merged under joint umbrella organizations as a means of reducing the size of staffs and eliminating duplicative functions. As part of these initiatives, the National Command structure is to be reduced by about 800 staff positions, and a new special inter-service unit will be established to facilitate civil-military cooperation. To carry out the future roles assigned to the armed forces, the NAF must be capable of the following:
In addition to its membership in NATO, the Dutch also pursue defense cooperation on a bilateral level. such as the formation of the German-Netherlands Army Corps, and the joint operations of the Royal Netherlands and Belgian Navies under a combined fleet concept. Defense Organization The Queen retains nominal responsibility as Commander-in Chief of the Netherlands Armed Forces (NAF). However, under the Netherlands’s Parliamentary system; the Cabinet, headed by the Prime Minister, holds executive authority over the NAF. The Prime Minister exercises his authority over the Armed Forces through the Minister of Defense, who is responsible for policy development and implementation within the armed forces. The State Secretary for Defense is responsible for personnel policy, material procurement, and daily management of the armed forces. The Minister of Defense is advised by a Council of Ministers; and is assisted in the performance of his duties by the Chief of the Netherlands Defense Staff, and a number of staff elements. The Chief of Defense Staff is the most senior military advisor to the Minister of Defense on operational policy and is the corporate planner of the Ministry of Defense. The Chief has overall responsibility for the defense planning process and also has an important role in directing the Army, Navy, Air Force, Royal Military Constabulary, and Interservice Command. The Commanders-in-Chief of the individual services have control over the formulation of the doctrine of their respective services. Key Defense Organization Personalities: Mr. Frank H. G. de Grave
Additional information on the Netherlands Ministry of Defense is available on the Internet at http://www.MINDEF.NL/ Defense Forces The Netherlands Armed Forces consist of approximately 64,000 active duty personnel, including:
Approximately 96,000 reserve and paramilitary personnel support the active duty force, including:
Naval Organization The Royal Netherlands Navy (RNlN) consists of approximately sixty-seven ships and craft, and thirty naval aircraft. It is administratively organized into the following commands:
The bulk of the RNlN is grouped in two balanced and integrated task forces that each have two air defense frigates (Tromp or Jacob Van Heemskerck class), four Karel Doorman class frigates, one AOR, two submarines, ten helicopters, and several MPA. Operationally, the Netherlands and Belgium have combined their fleets under the operational command of Admiral Benelux (ABNL), which is headquartered in Den Helder, Netherlands. Key Navy Personalities:
Additional information on the RNlN is available on the Internet at http://www.mindef.nl or http://www.MINDEF.NL/english/rnln1.htm Naval Forces The Royal Netherlands Navy currently consists of approximately sixty-eight ships and craft:
Defense Budget
* Currency conversions based on exchange rates for 13 September 2001 (US$1=2.42NLG) Like many of its NATO allies, the Netherlands has steadily cut its defense budget throughout the 1990s. Under the Defense White Paper 2000 plan, the annual military budget will remain at or near current levels for the better part of the decade. In early 2001, the Dutch Government did announce a US$825 boost in defense spending for the decade (2002 – 2011). The new funds were established to assist in the further integration into the European defense structure, and to adapt forces for rapid reaction, which include many of the projected programs under the Defense White Paper 2000 plan. Defense Acquisition and Procurement Process The Netherlands defense procurement procedures are based on the following laws:
The Netherlands does not advertise procurement opportunities for military equipment. Information is sent only to those firms that are on a qualified source list. It is very important for firms to request placement on the qualified source list for future military procurements. Being added to the qualified source list can be accomplished by writing to the appropriate service in The Hague. Firms wishing to do business with the Netherlands Ministry of Defense are recommended to have local representatives as well. The Netherlands procurement process is accomplished at two distinct levels:
Additionally, the Netherlands Parliament is intensively involved in the decision-making process at various stages of major acquisition programs. Any program that involves more than US$265M requires the approval of Cabinet and the Parliament. The entire process for a major Navy acquisition could cover between eight and twelve years. A project starts with the drafting of the operational requirement by the Naval Staff, during which time the DMKM has a supporting role. For each major project, a dedicated management organization is set up under the responsibility of the Deputy Flag Officer Materiel (Projects). Smaller projects are managed under the responsibility of the Deputy Flag Officer Materiel (Engineering). All tendering/contracting is carried out under the responsibility of the Deputy Flag Officer Materiel (Procurement). Projects are considered to be complete at the end of the warranty period for the last unit. Life-cycle support is accomplished under the responsibility of the Deputy Flag Officer Materiel (In-Service Support), and utilizes its own depot-level maintenance facilities at Den Helder. Key Defense Acquisition Personalities:
Supplier Trends Most RNlN naval vessels were built and are continuing to be built in Dutch shipyards, and are fitted with Thales Nederland (formerly Signaal) sensor systems, combat management systems, and close-in weapons systems (CIWS). Beyond those specific areas of expertise (of which the Government wishes to maintain their industrial capability), the Navy has turned to a variety of West European and American producers for weapons and propulsion systems. Currently, all missile systems in use in the RNlN are of US manufacture (Standard SM-1 and SM-2, and NATO Sea Sparrow surface-to-air missiles; and Harpoon surface-to-surface missiles), as are the torpedoes (Mk 46 lightweight ASW torpedoes in surface ships and aircraft, and Mk 48 torpedoes in submarines). For guns, the Dutch have turned to OTOBreda for the 127mm and 76mm guns. Propulsion systems have been provided by Stork Wartsila (diesels), Rolls Royce (gas turbines), and Schelde Gears (gear boxes). As a member of the European Union, the Dutch can be expected to rely upon European suppliers to the maximum extent possible. In those areas for which they have an established industrial capability, the Government will pursue a "buy Dutch" program. In fact, the priority of programs is determined, in part, by how much local content is involved. All foreign contractors must provide at least 100 percent offset/compensation for defense procurements over US$2.5M. The seller must arrange for the purchase of Dutch goods or permit the Netherlands to domestically produce components or subsystems of the systems it is buying. The Dutch Government is considering a penalty system for noncompliance. Naval Threat – Mission During the Cold War, the RNlN operated in the open waters of the Atlantic Ocean as a blue-water navy. However, with today’s emphasis on peacekeeping missions, the Navy finds itself operating in littoral waters, and faces new, brown-water challenges. These new challenges include a much more diverse threat scenario than that of the Cold War. For the most part, the Dutch Navy of the Cold War was an ocean escort navy oriented towards anti-submarine warfare (ASW) operations. Today’s littoral operations have forced the Netherlands to consider such threats as high-speed anti-ship missiles and theater ballistic missiles. To accomplish its wartime and peacetime missions, the RNlN has assumed the following tasks in support of Dutch national security:
Naval Ship Projections The RNlN currently operates sixty-seven ships and craft. Most are relatively modern built from the 1980s through the 1990s. The majority of its vessels are built in the Netherlands, and their weapons systems are a mixture of indigenously produced systems, as well as European and US. The following shipbuilding programs are underway, or are projected throughout the decade (2002 – 2011): · De Zeven Provincien Class Destroyer: Started in 1998, this program entails the construction of four new multi-purpose destroyers. The first unit, De Zeven Provincien, was launched in April 2000, and will commission in March 2002. Three additional units will be commissioned from 2003 through 2006.· Rotterdam Class Landing Platform, Dock (LPD): The first unit of the class was commissioned in 1998. A second unit was authorized under the Defense White Paper 2000 plan in November 1999. The second unit will be probably be ordered by 2003, and commissioned by 2007.· Amsterdam Class Fleet Replenishment Ship (AOR): This program was planned in the early 1990s to replace the two units of the Poolster class AORs in service. The first unit of the class was commissioned in 1995, and the second unit will probably be laid down in 2007, with a commissioning date of 2010.· MK IX Class Landing Craft, Utility (LCU): This program started in 1996 to provide LCUs for the new Rotterdam class LPD. The decision to construct a second unit of the Rotterdam class will require five additional MK IX LCUs. A construction contract can be expected by 2004.· Future Corvette: The RNlN will probably begin planning for the replacement of the two Jacob Vans Heemskerck and the first four units of the Karel Doorman class frigates around 2009. In guideline with the Defense White Paper 2000 objectives, fourteen major surfacecombatants will be retained. More than likely, a corvette sized vessel will replace the two classes of frigates. · Future Coastal Mine Hunter (MHC): The RNlN will be modernizing its twelve Alkmaar (Tripartite) class MHCs to extend their service lives through the next decade. By 2009, the RNlN will probably begin planning for their replacement.· Hydrographic Survey Ship: This program was authorized under the Defense White Paper 2000 plan in November 1999 to replace the Buyskes and Tydeman class hydrographic survey ships in service. Both units will be in service by the end of 2004.RN1N New Construction Projects
* FOC RfP is the First of Class Request for Proposal
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