How quickly can the Netherlands actually switch to a war economy? That question has become more important to me since I attended a meeting in Rotterdam City Hall last week with the title The Rotterdam Summit had received. With the shocking answer after that morning that the Netherlands still has a long way to go.
The meeting with numerous entrepreneurs around the port of Rotterdam was organized by consultancy firm KPMG and VNO-NCW, whose new chairman Coen van Oostrum sat in the front row. NATO Secretary General Mark Rutte spoke as chief guest. Of course we know his own warnings and of NATO generals that Europe must prepare for war with the increasing threat and must work towards a war economy in peacetime. This war economy extends beyond increasing defense expenditure and strengthening Europe’s own defense industry, although that is often the emphasis.
It is also about increasing resilience, and that involves more than citizens having an emergency kit ready in their kitchen cupboard or basement. Resilience also lies in the energy supply, infrastructure, cybersecurity and the resilience of people, Rutte emphasized once again. Take Ukraine as an example from which we can learn a lot.
How do we make the port of Rotterdam resilient was the key question at this Rotterdam meeting, and not so much whether this is necessary and why. It is not surprising that this question arises in a location that is of eminent importance to the economy as a junction, in times of peace and war.
Overdue maintenance
Also for NATO, because in the event of war, American troops and their equipment will land here and spread further across Europe. They need not only the capacity in the port itself, but also the strong infrastructure behind it so that those troops can move through quickly. An additional reason to tackle the overdue maintenance that is widely observed, with all the billions that it costs.
- We are working on that resilience, I learned from the further conversations on stage. A few notes from my notebook.
- The Rotterdam Port Authority, director Boudewijn Siemons said, has contacts with various companies no fewer than eight resilience tables set up.
- The Ministry of Infrastructure and Water Management is working with other agencies on scenarios with alternatives for how to communicate if telephone and internet services fail, a deputy director general said.
- Three quarters of directors of companies in the Netherlands are themselves aware of the threat of war, according to KPMG research.
But the second figure that KPMG director Stephanie Hottenhuis mentioned in the same breath tells more. Because only forty percent of those directors are also concerned with that threat in their own organization. She also outlined how the world of just-in-time, where companies operate with minimal inventory, is over. That everyone will have to allow more fat on their bones to be able to draw on those reserves if the supply channels falter. But she also made it clear that the discussion about who will pay for this loss of efficiency is still ongoing. In other words: does the world of just-in-case exist?
And so everything is still under construction. The Ministry of I&W is mainly still working on plans for alternatives to communication, which still need to be practiced. The resilience tables in the port have only just started to look at what can be done together to ensure that activities in the port continue as much as possible in all circumstances.
There is no shortage of reports
The Summit does not stand alone. It is striking how many studies have been produced in recent weeks by research institutes and think tanks about the vulnerabilities that exist and the preparations that should be made.
Two weeks ago, the Hague think tank HCSS, commissioned by the trade association of fuel suppliers Vemobin, published a study into how fuel shortages in the Netherlands and Europe can limit military operations and could threaten the continued functioning of the economy. Part of the research is also the declining refining capacity in the Netherlands (i.e. in Rotterdam) and also the rest of Europe, which is shrinking much faster than would be wise, given the need for fossil fuels such as kerosene and diesel for fighter planes and tanks. That could only increase the need for imports in wartime.
This week, research institute TNO and consultancy firm Strategy& published a study, which emphasizes that as a link in strengthening the defense industry, the retention of companies in petrochemicals, basic chemicals and the materials industry is essential.
It is not daring to predict that we in the editorial office will see more such reports arriving in our email boxes. While a few years ago it was unthinkable that we would think and talk so emphatically about preparations for a war, this has now become an item high on the agenda.
Defense and resilience in wartime thus become elements in the already complex discussions about which industry we do and do not want to keep in the Netherlands, or in Europe, and in what way and with what capacity. These are discussions that are not easy anyway due to climate change, lack of space, attention to health and the environment and energy shortages. The puzzle only becomes more difficult.
Should the resilience of Dutch companies and the Dutch economy be given much more consideration? And are we already behind in building resilience? Let me know what you think via [email protected]