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Netherlands Economical Facts

 

Economical overview

Foreign trade forms the basis of the Dutch economy and benefits from its geographical location as a natural transport hub in Europe. Trade dependence is both direct and indirect: trade generates income while the industry and parts of agriculture need raw materials, not least as their own natural resources are limited.

The Netherlands is one of the world's largest trading nations. Both imports and exports of goods and services each amount to more than two-thirds of the country's gross domestic product (GDP).

  • Countryaah.com: Major imports by Netherlands, covering a full list of top products imported by the country and trade value for each product category.

A large part of the trade to and from the EU market goes through the Netherlands. The port of Rotterdam is the largest in Europe and one of the largest in the world. Amsterdam Airport Schiphol is one of the most important in Europe. For almost the entire post-war period, the Netherlands has had significant surpluses in trade with the rest of the world, both in terms of goods and services.

Amsterdam is an important center for the trade in tobacco, diamonds and precious metals. The Netherlands also has significantly high foreign direct investment and many foreign companies are located in the country. About a tenth of all employees work for foreign companies.

Economical Facts of Netherlands

Trade benefits from an open economy, almost free of customs and other barriers to trade. But it also makes the economy extremely sensitive to fluctuations in the world economy.

  • Abbreviationfinder.org: Check this abbreviation website to find three letter ISO codes for all countries in the world, including NED which represents the country of Netherlands.

A recession shortly after the turn of the millennium, the Netherlands hit harder than any other country in Western Europe. Lack of labor had pushed wages and inflation upward, and the country's competitiveness gradually deteriorated. Important commodity exports decreased when the recession began with force in 2002, leading to economic decline and shrinking GDP. Unemployment grew to the highest in 20 years, although it was still low compared to other EU countries. During the same period, the state budget was further burdened by a rapidly rising number of long-term sick leave.

As so many times before in the Netherlands, the government and trade unions in 2004-2005 agreed on a compromise package with a halt for wage increases in exchange for trade union influence over cuts in social security systems. The compromise was fruitful and in 2005 the economy improved significantly with increased GDP growth and reduced unemployment. Until 2007, the good international economy also contributed to stable economic development.

The Netherlands was then hit relatively hard both by the global financial crisis that hit 2008 and the eurozone debt crisis thereafter. The economy shrank in 2009, as in most industrialized countries. In the Netherlands, growth then became positive only for a couple of years, in 2012 and 2013, the economy shrank again. Since then it has stayed above the zero line.

In order to mitigate the consequences of the crisis, the government initiated a series of stimulus measures - early infrastructure projects, increased export credits and tax relief to companies, etc. In addition, large sums went to save the vulnerable banking sector. All of this contributed to a budget deficit that in 2009 and 2010 was above 5 percent of GDP. Only in 2013 was the deficit down below the euro zone ceiling of 3 percent of GDP.

A new cloud of concern for the economy surfaced when the British voted in favor of leaving the EU in the summer of 2016. According to the OECD Economic Cooperation Organization, the Netherlands is one of three countries most at risk of "Brexit", due to the country's large trade exchange and extensive investments in the UK (the others are Ireland and Luxembourg).

FACTS - FINANCE

GDP per person

US $ 53,024 (2018)

Total GDP

US $ 913,658 million (2018)

GDP growth

2.6 percent (2018)

Agriculture's share of GDP

1.6 percent (2018)

Manufacturing industry's share of GDP

11.1 percent (2018)

The service sector's share of GDP

69.9 percent (2018)

Inflation

2.5 percent (2019)

Government debt's share of GDP

52.4 percent (2018)

Currency

euro 1

Merchandise exports

US $ 574,585 M (2018)

Imports

US $ 487 245 M (2018)

Current account

US $ 99,063 million (2018)

Commodity trade's share of GDP

150 percent (2018)

Main export goods

machinery, transport equipment, chemical products, natural gas, food

Largest trading partner

Germany, Belgium, France, UK, China, Italy

  1. 1 euro = 100 cents

2006

November

New elections are held

November 22

The government parties have a headwind when new elections are held, mainly due to the economic downturn. CDA loses three seats but remains the largest with 41 seats. The VVD backs 6 seats to 22. The D66 halves from 6 seats to 3. The Labor Party makes another poor choice and shrinks from 42 seats to 32. The Socialist Party advances from 9 to 26 seats. A newly formed xenophobic party, the Freedom Party (PVV), gets 9 seats and enters the parliament, while the old LPF (now converted to List five Fortuyn, LVF) lapses. For the first time, a party for animal rights also enters a European parliament.

July

Balkenende forms a minority government

Prime Minister Jan Peter Balkenende continues to rule at the head of a government consisting of the ministers from the CDA and the VDD.

June

The government is cracking down again

The government falls when D66 jumps off the collaboration in protest against the handling of the Ayaan Hirsi Ali case (see May 2006). This is happening despite the fact that the Minister of Migration Verdonk changed before the impending government crisis, saying that a loophole in the law was found that allows Hirsi Ali to stay in the country. But a distrust vote is announced and D66 supports it.

May

Controversy surrounding the MP

A Somali-born MP, Ayaan Hirsi Ali, resigned after it was revealed that she had submitted false information in connection with her asylum application in 1992. Hiris Ali is known, among other things, as a screenwriter for van Gogh's film Submission (see November 2004). Migration Minister Rita Verdonk, who, like Hirsi Ali, is a member of the VVD, demands that her citizenship be withdrawn.

February

Increased efforts in Afghanistan

Decides that the Dutch force in Afghanistan of over 600 people should be increased to 1 600 men; The force is part of the NATO-led international ISA force. The soldiers are to be placed in the troubled area of ​​Uzurgan.

 

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