Macroeconomic scoreboard

Table description


This table shows the indicators of the macroeconomic scoreboard. Furthermore, some additional indicators are shown. To identify in a timely manner existing and potential imbalances and possible macroeconomic risks within the countries of the European Union in an early stage, the European Commission has drawn up a scoreboard with fourteen indicators. This scoreboard is part of the Macroeconomic Imbalance Procedure (MIP). This table contains quarterly and annual figures for both these fourteen indicators and nine additional indicators for the Netherlands.

The fourteen indicators in the macroeconomic scoreboard are:
- Current account balance as % of GDP, 3 year moving average
- Net international investment position, % of GDP
- Real effective exchange rate, % change on three years previously
- Share of world exports, % change on five years previously
- Nominal unit labour costs, % change on three years previously
- Deflated house prices, % change on one year previously
- Private sector credit flow as % of GDP
- Private sector debt as % of GDP
- Government debt as % of GDP
- Unemployment rate, three year moving average
- Total financial sector liabilities, % change on one year previously
- Activity rate, % of total population aged 15-64, change in percentage points on three years previously
- Long-term unemployment rate, % of active population aged 15-74, change in percentage points on three years previously
- Youth unemployment rate, % of active population aged 15-24, change in percentage points on three years previously

The additional indicators are:
- Real effective exchange rate, index
- Share of world exports, %
- Nominal unit labour costs, index
- Households credit flow as % of GDP
- Non-financial corporations credit flow as % of GDP
- Household debt as % of GDP
- Non-financial corporations debt as % of GDP
- Activity rate, % of total population aged 15-64
- Youth unemployment rate, % of active population aged 15-24

Data available from: first quarter of 2006.

Status of the figures:
Annual and quarterly data are provisional.

Changes as of 5 July 2021:
For all indicators except for the long-term unemployment, figures on the first quarter of 2021 have been added. For the long-term unemployment the figure for the fourth quarter of 2020 have been added, as well as the annual figure for 2020.
Furthermore, some figures have been adjusted: Current account balance, Net international investment position, the private credit flow, non-financial corporations credit flow, households’ credit flow, private sector debt, households’ debt, non-financial corporations’ credit flow have been adjusted as of 2018.

When will new figures be published?
New data are published within 120 days after the end of each quarter. The first quarter may be revised in October, the second quarter in January. Quarterly data for the previous three quarters are adjusted along when the fourth quarter figures are published in April. This corresponds with the first estimate of the annual data for the previous year. The annual and quarterly data for the last three years are revised together with the publication of the first quarter in July.

Description topics

Current account balance, % of GDP
Current account balance, % of gross domestic product (GDP), three-year moving average.

The current account balance is made up of three parts:

- The trade balance: value of exports of goods and services minus value of imports of goods and services;
- Balance on income: primary income received from the rest of the world minus primary income paid to the rest of the world. Primary income consists of compensation of employees, taxes and subsidies on production and imports, and property income;
- Net current transfers: current transfers received from the rest of the world minus current transfers paid to the rest of the world. Current transfers are dividend tax, social security premiums and benefits and other current transfers.

Sources:
The current account balance is based on the balance of payments as set by the De Nederlandsche Bank (DNB). The GDP is compiled by Statistics Netherlands (CBS) on the basis of its available sources.

Calculation of the scoreboard indicator:
First, the current account balance is calculated as a percentage of GDP. Subsequently the three-year moving average of these percentages is calculated.

Interpretation of the indicator:
In most cases, a current account surplus means that an economy has a positive trade balance, i.e. it exports more than it imports. A positive trade balance contributes to economic growth and may be the result of a strong international competitiveness.
Usually, a current account surplus is accompanied by a net capital outflow, which improves the economy's net international investment position. Conversely, a long-term current account deficit is accompanied by a net capital inflow, which can make the economy vulnerable to foreign investment sentiment.

Upper and lower limits:
For this indicator, the European Commission has set a lower limit of -4 percent and an upper limit of +6 percent.
Net international investment position
Net international investment position, % of gross domestic product (GDP).

The net international investment position is the value of financial assets of Dutch residents abroad minus the value of financial assets of non-residents in the Netherlands.

The net international investment position can be divided into:
- Net direct investment;
- Net portfolio investment;
- Net financial derivatives;
- Net official reserves;
- Net other investment.

Sources:
The net international investment position is based on the balance of payments as compiled by De Nederlandsche Bank (DNB). GDP is compiled by Statistics Netherlands (CBS) on the basis of its available resources.

Calculation of the scoreboard indicator:
The net international investment position is calculated as a percentage of GDP.

Interpretation of the indicator:
If the net international investment position is negative, a country is in debt to the rest of the world. A large negative net international investment position means that a country is sensitive to developments on international capital markets. However, the composition of the assets and debts is critical in this respect. If Dutch equity investors perform worse abroad than foreign equity investors in the Netherlands, the Dutch net international investment position will decrease, but this will not lead to an increase in Dutch vulnerability. If the net international investment position decreases because more money is borrowed abroad, vulnerability will increase, however.

Upper and lower limits:
For this indicator the European Commission has only set a lower limit: -35 percent.
Real effective exchange rate
Real effective exchange rate (42 partners).
The real effective exchange rate is defined as the nominal effective exchange rate adjusted for price developments.
Real eff.exch.rate,change on 3 yrs prev.
Real effective exchange rate (42 partners) - % change on three years previously.

The real effective exchange rate is defined as the nominal effective exchange rate adjusted for price developments.

The nominal effective exchange rate is the trade-weighted exchange rate of a currency compared to some other currencies that are important for the economy. For the scoreboard, the effective exchange rate with 42 trading partners is calculated.

Sources:
The real effective exchange rate is based on data and calculations from the European Commission (DG ECFIN) and is published by Eurostat. See Eurostat's website for more information with regard to the calculation of the real effective exchange rate.

Calculation of the scoreboard indicator:
For the scoreboard, the real effective exchange rate for the Netherland with 42 trading partners (source: Eurostat) is taken as a starting point. Subsequently the percentage change on three years previously is calculated.

Interpretation of the indicator:
The real effective exchange rate reflects both relative price developments and the development of the exchange rates. Negative growth may indicate an improvement in price competitiveness, positive growth a deterioration.

Upper and lower limits:
For this indicator the European Commission has set a lower limit of -5 percent and an upper limit of +5 percent for Eurozone countries, and limits of -11 percent and + 11 percent for non-Eurozone countries.
Real effective exchange rate, index
Real effective exchange rate (42 partners), index.

The real effective exchange rate is defined as the nominal effective exchange rate adjusted for price developments.

The nominal effective exchange rate is the trade-weighted exchange rate of a currency compared to some other currencies that are important for the economy. For the scoreboard, the effective exchange rate with 42 trading partners is calculated.

Sources:
The real effective exchange rate is based on data and calculations from the European Commission (DG ECFIN) and is published by Eurostat. See Eurostat's website for more information with regard to the calculation of the real effective exchange rate.

Calculation of the scoreboard indicator:
See Eurostat's website for more information with regard to the calculation of the real effective exchange rate.

Interpretation of the indicator:
The real effective exchange rate reflects both relative price developments and the development of the exchange rates. Negative growth may indicate an improvement in price competitiveness, positive growth a deterioration.

Upper and lower limits:
The European Commission has upper and lower limits for the change on three years previously. The European Commission has set a lower limit of -5 percent and an upper limit of +5 percent for Eurozone countries, and limits of -11 percent and + 11 percent for non-Eurozone countries.
Share of world exports
Share of world exports as a % of world exports.
The share of world exports is defined as the value of exports of goods and services in the Netherlands as a percentage of the value of world exports. The value of exports of goods and services in the Netherlands is based on the balance of payments as compiled by the Dutch Central Bank (DNB).
Share of world exports,change 5 yrs prev
Share of world exports as a % of world exports - % change on 5 years previously.

The share of world exports is defined as the value of exports of goods and services in the Netherlands as a percentage of the value of world exports. The value of exports of goods and services in the Netherlands is based on the balance of payments as compiled by the Dutch Central Bank (DNB).

Sources:
The value of world exports is based on data from the International Monetary Fund (IMF). IMF data are available only on an annual basis; quarterly data are based on an interpolation using both the world export volume index and the world export price index in dollars from the world trade monitor of the Netherlands Bureau for Economic Policy Analysis and euro-dollar exchange rate figures from the Dutch central bank (DNB).

Calculation of the scoreboard indicator:
Exports of goods and services are calculated as a percentage of world exports. Subsequently, the percentage change is calculated with respect to five years previously.

Interpretation of the indicator:
Exports of goods and services are a source of income for a country. A change in a country's share in world exports indicates a change in its relative competitiveness on the world market.

Upper and lower limits:
For this indicator, the European Commission has set only a lower limit: - 6 percent.
Share of world exports, percentage
Share of world exports as a % of world exports

The share of world exports is defined as the value of exports of goods and services in the Netherlands as a percentage of the value of world exports. The value of exports of goods and services in the Netherlands is based on the balance of payments as compiled by the Dutch Central Bank (DNB).

Sources:
The value of world exports is based on data from the International Monetary Fund (IMF). IMF data are available only on an annual basis; quarterly data are based on an interpolation using both the world export volume index and the world export price index in dollars from the world trade monitor of the Netherlands Bureau for Economic Policy Analysis and euro-dollar exchange rate figures from the Dutch central bank (DNB).

Calculation of the scoreboard indicator:
Exports of goods and services are calculated as a percentage of world exports.

Interpretation of the indicator:
Exports of goods and services are a source of income for a country. A change in a country's share in world exports indicates a change in its relative competitiveness on the world market.

Upper and lower limits:
For this indicator, the European Commission has set only a lower limit for the change on five years previously: - 6 percent.
Nominal unit labour costs
Nominal unit labour costs are defined as the ratio between nominal labour costs per employee and labour productivity.
Nom.unit lab.costs,change on 3 year prev
Nominal unit labour costs - % change on three years previously.

The nominal unit labour costs are defined as the ratio of labour costs per employee to labour productivity. Labour costs are the ratio of total compensation of employees to the number of employees. The total compensation of employees consists of wages and salaries and employers’ social contributions. Labour productivity is calculated as the ratio of gross domestic product (price level 2010) to the total employment.

Eurostat's method for calculating nominal unit labour costs deviates from the concept 'labour costs'. Labour costs not only consist of wages and salaries that are periodically and directly paid to employees and employers' social contributions, but also costs that are associated with the employment of personnel, such as wages in kind, holiday allowances and refunds for training costs made by the employee. Besides, wage subsidies are deducted. In this table, figures are presented according to the definition of Eurostat and the European Commission.

In addition to the nominal unit labour costs, Statistics Netherlands presents quarterly figures on unit wage costs in the table 'Loonkosten per eenheid product; nationale rekeningen'. The wage costs are the total of wages, social contributions paid by employers and taxes on wage costs minus wage cost subsidies.

Sources:
The data are from Statistics Netherlands' national accounts.

Calculation of the scoreboard indicator:
Nominal unit labour costs are calculated on the basis of available data: compensation of employees, gross domestic product (price level 2010), number of employees and number of persons employed. Subsequently, the percentage change compared to three years previously is calculated.

Interpretation of the indicator:
Positive growth means that labour costs are rising faster than labour productivity, which may adversely affect the competitiveness in the long term.

Upper and lower limits:
For this indicator, the European Commission has set only an upper limit: + 9 percent for Eurozone countries and + 12 percent for non-Eurozone countries.
Nominal unit labour costs, index
Nominal unit labour costs - index

The nominal unit labour costs are defined as the ratio of labour costs per employee to labour productivity. Labour costs are the ratio of total compensation of employees to the number of employees. The total compensation of employees consists of wages and salaries and employers' social contributions. Labour productivity is calculated as the ratio of gross domestic product (price level 2010) to the total employment.

Eurostat's method for calculating nominal unit labour costs deviates from the concept 'labour costs'. Labour costs not only consist of wages and salaries that are periodically and directly paid to employees and employers' social contributions, but also costs that are associated with the employment of personnel, such as wages in kind, holiday allowances and refunds for training costs made by the employee. Besides, wage subsidies are deducted. In this table, figures are presented according to the definition of Eurostat and the European Commission.

In addition to the nominal unit labour costs, Statistics Netherlands presents quarterly figures on unit wage costs in the table 'Loonkosten per eenheid product; nationale rekeningen'. The wage costs are the total of wages, social contributions paid by employers and taxes on wage costs minus wage cost subsidies.

Sources:
The data are from Statistics Netherlands' national accounts.

Calculation of the scoreboard indicator:
Nominal unit labour costs are calculated on the basis of available data: compensation of employees, gross domestic product (price level 2010), number of employees and number of persons employed.

Interpretation of the indicator:
Positive growth means that labour costs are rising faster than labour productivity, which may adversely affect the competitiveness in the long term.

Upper and lower limits:
For this indicator, the European Commission has set only an upper limit for the change on three years previously: + 9 percent for Eurozone countries and + 12 percent for non-Eurozone countries.
Deflated house prices
Deflated house prices, % change on one year previously.

Deflated house prices are the ratio between the house price index on the one hand and the deflator for household consumption on the other.

The house price index shows the average price development of all own (i.e. non-rental) homes, both existing and newly constructed, which are intended for permanent residence by a private household.

The deflator for household consumption reflects average price developments in consumption expenditure by households (including non-profit institutions serving households). This deflator is similar, but not identical, to the consumer price index (CPI).

Sources:
The house price index is calculated by Statistics Netherlands (CBS). Statistics Netherlands does not yet publish the house price index used here, but does publish a price index of existing residential property on a quarterly basis. See the website of Eurostat for more information about the house price index.

The deflator for household consumption is derived from Statistics Netherlands’ national accounts.

Calculation of the scoreboard indicator:
The house price index is divided by the deflator for household consumption. Subsequently the percentage change with respect to one year previously is calculated.

Interpretation of the indicator:
The indicator compares the development of house prices with the development of the average consumer prices for households. Positive growth means that house prices are rising faster than consumer prices. In time, this may indicate a price bubble in the housing market.

Upper and lower limits:
For this indicator, the European Commission has set only an upper limit: +6 percent.
Private sector credit flow
The private sector credit flow shows by how much debts of households, non-profit institutions and non-financial companies have increased (or decreased), excluding price developments of bonds and money market paper.
Private sector credit flow as a % of GDP
Private sector credit flow, % of gross domestic product (GDP).

The private sector credit flow shows by how much debts of households, non-profit institutions and non-financial companies have increased (or decreased), excluding price developments of bonds and money market paper. Debts include only securities (excluding shares and derivatives) and loans, and are consolidated, i.e. debts within the same sector are not included.

Sources:
The data are from Statistics Netherlands' national accounts.

Calculation of the scoreboard indicator:
The private credit flow is calculated as a percentage of GDP.

Interpretation of the indicator:
A high credit flow to the private sector, consisting of non-financial corporations, households and non-profit institutions serving households, increases the vulnerability of these sectors to developments in the business cycle, interest rates and inflation. Strong price fluctuations in financial and non-financial assets may also have their origin in changes in the private credit flow.

Upper and lower limits:
For this indicator, the European Commission has set only an upper limit: +14 percent.