ROTTERDAM - The city of Rotterdam appears to be the first victim of the diplomatic row between China and the Netherlands over the construction of a number of submarines for Taiwan. Out of dissatisfaction with the order to Rhine-Scheldt Verolme (RSV) China's largest shipping company no longer allows its ships to use the docks in the port of Rotterdam. Shell is also the victim of a boycott after the submarine affair.

Shipbuilder RSV itself is also affected by the boycott. The company is with the yards of Wilton-Feyenoord and the Rotterdam Dry Dock Company (RDM) the largest party in the ship repair market. The boycott could save work on 200 Chinese ships annually.

The management of the China Ocean Shipping Company has stated that it is not an empty threat. From lokale director Vos, let us know in De Volkskrant, that after a collision on the Western Scheldt, the freighter Xing Ming diverted to Hamburg for repairs. The ship has unloaded the cargo in Rotterdam, then have some emergency repairs carried out at somewhat smaller yards, to be able to sail to Germany.

Submarines

The submarine affair revolves around the Taiwanese order for two Walrus-class submarines at RSV's Rotterdam shipyards. China still sees Taiwan as a renegade province.

The Dutch government has provisionally approved the lucrative deal (450 miljoen gulden). The situation in the shipbuilding industry meant that this deal would keep RSV going for years to come. RSV personnel may also go to Taiwan to train people there.

Trade

For the time being, the import and export of Chinese trade via Rotterdam will continue. Vos says in the Volkskrant that the China National Chartering Corporation, which deals with all trade to and from China, has not yet responded to the submarine affair.

Rotterdam has so far been the most important transit port for Chinese goods, but according to Vos, the trade is quite simple to divert via Hamburg or Bremen. Relocating to Belgium is also an option.

Shell

Oil company Shell is also a victim of the Chinese boycott. Until recently, the company was in far-reaching negotiations to build a lubricating oil plant in China's Shanxi province. A spokesman for the Chinese Embassy made it clear today that all talks have been stopped and that "under current circumstances it is not advisable to continue the work".

Shell is particularly affected because almost all Chinese aircraft use Shell kerosene. That sale would now also be in danger.

How much the trade boycott will cost Shell, the oil company cannot say. Shell also says it deeply regrets the Chinese decision.

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To care

Mayor Van der Louw of Rotterdam has again expressed his concern about the consequences of the submarine affair. Two years ago he led a delegation from Rotterdam to China.

In the run-up to the submarine order to RSV, Van der Louw was asked to give advice. He advised to abandon the order.

According to Van der Louw, the employment temporarily generated by the submarine order to Taiwan is less important than the loss of employment that could arise in our country as a result of the Chinese boycott.

According to the city council of Rotterdam, the Chinese boycott could cost 500 jobs in Rotterdam. The loading and unloading of Chinese ships delivers such a supply in the port of Rotterdam 50 tot 60 million euros.

General cargo companies such as Müller Thomson, Multi Terminals and Kroonvlag would take the hardest blows. Bulk cargo companies such as Graan Elevator Maatschappij and Frans Swarttouw would also be affected by the boycott.


Hoe ging het verder?

In the days that followed, the Chinese brought the situation even further to a head. Op 28 January leaks out that China is in talks with Antwerp and Zeebrugge about the relocation of all trade. That same day also comes out that chemicals, destined for China, are no longer allowed to come via Rotterdam.

Van der Louw is busy lobbying behind the scenes. He is writing a letter to his Chinese colleague in sister city Shanghai, in which he apologizes for the submarine order. He also expresses the hope that the submarine affair will not be at the expense of the bond between the two cities.

The so cherished city bond with Shanghai is then put on hold by the Chinese.

More Dutch companies were told that orders from China were being canceled, such as Philips and Martinair.

Political resistance

Resistance to the deal is also growing in political The Hague. On paper, the Netherlands has no ties with Taiwan, but with the people's republic. In that regard alone, it would be remarkable that the government is allowing the deal to go ahead.

The opposition is mainly led by D66 leader Laurens-Jan Brinkhorst. An attempt just before Christmas to block the permission for the construction did not succeed with a slight difference (75-74).

But when the consequences of the Chinese boycott are clear at the beginning of February, the CDA tackles. A motion is passed calling on the cabinet to abandon the RSV order.

That motion is not taken up by Van Agt, because it would be "too late". China called its ambassador back from the Netherlands and expelled the Dutch ambassador from the country.

The consequences of the submarine affair are considerable. Prime Minister Van Agt later announced that Dutch companies would be at the back of the queue for the time being when it came to Chinese orders. Shipbuilders in particular are hit hard, because for almost five years no or hardly any new orders have been received. Japanese companies are taking over the role of the Netherlands.

Due to a large overcapacity in the shipbuilding industry, for a long time, the industry has not been doing well. It didn't work out well with RSV either. In the 1980s, the company increasingly focused on other industries, such as the construction of power stations and machines. In 1983 a postponement of payment was requested. The company had until then 2,7 billion guilders in government support.

Two years after the submarine affair, Taiwan comes back to the Netherlands for two submarines. Then the cabinet will immediately say no. This helps to improve relations between China and the Netherlands. A year later, the first trade mission goes to China. The city link between Rotterdam and Shanghai has now also been restored.

Those submarines eventually got there? Ja, but that took years. Pas in 1987 the Hai Hu and the Hai Lung were delivered. According to China expert Fred Sengers, these ships were in 2019 still in use.

Sources:

De Volkskrant – 20-01-1981 – Shipping company avoids Rotterdam docks

Het Vrije Volk – 20-01-1981 – China strikes back: no business with Shell

Het Vrije Volk – 21-01-1981 – Big mistake

Het Vrije Volk – 22-01-1981 – Not welcome

Trouw – 22-01-1981 – Education

TVNZ – 24-01-1981 – Visit canceled on request RSV

De Volkskrant – 27-01-1981 – Break with China costs 600 jobs

De Volkskrant – 29-01-1981 – China talks to Belgium

historical Newspaper – 2019, Fred Sengers – The submarine affair between the Netherlands and China

Author: Dave Datema

published: 19-01-2021

story number: 156