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Business

American Company Boycotts Germany

In the first recorded case of its kind, an American company says it has canceled orders from a German company, citing Germany's refusal to support a possible U.S.-led war against Iraq.

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German supplier Lederett yields its business to American companies.

Ever since Chancellor Gerhard Schröder first uttered the words "no" to a war against Iraq on the campaign trail, German business executives have been publicly agitated by political tensions between Berlin and Washington.

They fear Germany's anti-war stance could have a damaging ripple effect on German manufacturers' sales in the United States, their biggest export market outside the European Union.

Now, those fears have become a reality -- at least for one small company in economically beleaguered eastern Germany. In an open letter to Schröder that was obtained by DW-WORLD on Wednesday, a shoe supply manufacturer based in Siebenlehn reported it had lost a lucrative contract with an American company because of Germany's anti-war stance.

Though Lederett will only lose an estimated €48,000 ($52,651) a year in revenues from the cancellation of orders from Enefco International of Auburn, Maine, the symbolic meaning goes beyond numbers.

A tough contract to win

In her letter, Lederett chief Grit Kuhnt said her 46-employee company had fought for two years to become a leatherboard supplier for Enefco International, a manufacturer of footwear supplies and contract cutting and packaging. Ninety percent of Lederett's business in sales of products including shoe heels and insoles comes from exports, Kuhnt wrote.

Kuhnt also pleaded with Schröder to "take steps to protect German industry and to modify its anti-war policy vis-a-vis Iraq so that our American friends can be certain that the federal government isn't going to sacrifice American friendships that have been built over many years on the alter of short-term domestic political gain."

"We don't know how many German companies have had to undergo similar experiences," Kuhnt added, "but we are certain that the federal government would react if, for example, the automobile industry were affected in this way." She also called on Schröder to personally intervene in the matter. But as of Wednesday, she had not yet received a response from the government.

Buying American

Lederett first learned it had lost its business with Enefco on Feb. 18. In a letter to Lederett's U.S. office, Enefco president Norman Farrar said the firm would no longer purchase products from the company for the "foreseeable future" because of the "lack of support for the U.S. by the Federal Republic of Germany." Farrar said he had been "very pleased" with the quality, service and price provided by Lederett, but "because of the current political situation I feel it necessary to strengthen U.S.-based industry and purchase locally, even at a slightly increased cost."

Farrar said he hoped for a change in the political climate in Germany so that he could "once again feel comfortable using Lederett material."

The American Chamber of Commerce in Germany, a trans-Atlantic trade association with 3,000 members in the United States and Germany, said on Wednesday this was the first time on record an American company has boycotted a German company over Berlin's anti-war stance. "We hope it stays that way," spokeswoman Patricia Limburg told DW-WORLD.

German businesses rally to prevent boycott

In recent weeks, German business and community leaders have undertaken efforts to prevent the kind of boycott that has hit Lederett. The Atlantik Brücke (Atlantic Bridge) organization recently took out a full-page ad in The New York Times and in the German newspaper Die Welt to try to soothe raw feelings. The ad by the group, Germany's oldest organization promoting U.S.-German ties, praised the two countries' "community of values."

"Today, with the world being forced to defend itself against terrorism and the spread of weapons of mass destruction, we reaffirm our alliance to the United States," it said.

Anton Börner, who heads a leading German business group, the Federation of German Wholesale and Foreign Trade, has said he fears the dispute between Berlin and Washington could cause extensive damage to the country's exports, the one area of the German economy that still is advancing. "The excellent, decades-long relationship with the United States is a fundamental pillar of our prosperity," Börner said in a recent statement.

"Increased unease"

Indeed, with 10.3 percent of all German exports going to the U.S., the stakes are high. And many companies are already under increasing pressure from their American clients. "They are feeling an increased unease in their dealings with customers," German Foreign Trade Federation spokesman André Schwarz recently told DW-WORLD.

Though none of Germany's blue chip companies -- including DaimlerChrysler, BMW and Siemens -- have reported any problems yet, Schwarz told DW-WORLD that many companies were already feeling the chill. Schwarz did not want to identify any of the companies that have complained because of their reluctance to go public.

"They are worried that the next step may be that people will look for alternatives," he said.

And that's a step one American company has already decided to take. In an e-mail to DW-WORLD sent late Wednesday evening, Farrar added: "I cannot in good conscience support the German economy, even in our own very small way, while at the same time the German government shows a lack of support for the United States."

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