According to the second estimate of Statistics Netherlands’ quarterly national accounts, Dutch economic growth came to 1.5 percent in the third quarter of 2004 compared with the same quarter in 2003. The is the largest increase in the volume of gross domestic product (GDP) in the last three years. The figure is 0.1 of a percent point up on the first estimate.
The substantial increase in exports contributed most to the growth. Household consumption, fixed capital formation and consumption by the government grew more modestly than twelve months previously.
Slight upward adjustment in economic growth
Economic growth in the third quarter of 2004 is 0.1 of a percent point higher in the second estimate than in the first estimate, published in November. The previously mentioned slight dip in investment has turned out to be a slight rise. Consumption by households has also been adjusted upwards. Exports, imports and government consumption have been reduced slightly.
Quarter-on-quarter growth 0.3 percent
After correction for working day and other seasonal effects, the volume of GDP was 0.3 percent higher in the third quarter than in the second quarter of 2004. This, too, is 0.1 of a percent point more than in the first estimate. The modest positive growth follows a slight decrease in the second quarter. Before that quarter-on-quarter growth was positive for three successive quarters.
Imports and exports continue strong growth
In the third quarter of 2004 the volume of exports of goods and services was 7.8 percent higher than in the same quarter of 2003. Exports grew faster than imports in the second quarter of 2004. In 2003 the volume of exports was the same as in 2002. Export growth in the third quarter of 2003 was the highest since the end of 2000. Imports were 8.0 percent higher than in the third quarter of 2003.
Slight increase in investment
Fixed capital formation was 0.7 percent higher in the third quarter of 2004 than twelve months previously. Higher investment in machines and equipment contributed to this modest growth. This is in line with the slightly higher capacity utilisation in the manufacturing industry in 2004. Businesses also invested more in company cars and computers. Investment in real estate was lower. More money was put into residential buildings, but less into infrastructure and especially office and factory buildings.
Government consumption hardly grows
The volume of government consumption was 0.3 percent higher in the third quarter of this year than in the same quarter last year. This increase is considerably smaller than the growth rates in recent years. Real expenditure on care was higher in the third quarter of 2004 than twelve months previously. Spending on public administration was lower, on the other hand.
Slightly faster growth for household consumption
In the third quarter of 2004 the volume of consumption by households was 0.7 percent higher than in the same quarter last year. This increase is slightly larger than the 0.4 percent increase in the first two quarters of 2004. In 2003 consumption fell by 0.9 percent.
After correction for price developments, consumers spent more on goods and services than in the third quarter of 2003. For goods this is the first increase since the first quarter of 2003. Spending on food, drink and tobacco was higher, but consumers spent fractionally less on durable goods such as furniture and cars. The decrease in spending on durables was the smallest in one and half years though.
Production growth mainly in trade, transport, farming and gas
Trade and transport benefited most from the modest economic recovery. In addition, agricultural crops were better than last year and more natural gas was produced in the third quarter of 2004, and mainly exported. Manufacturing production hardly increased. Production in the metal industry was higher, but that in the chemical sector decreased for the first time in two and a half years. One important reason for this is that installations were taken out of operation for purposes of maintenance. The recovery in the employment agency sector definitely contributed to the slight growth of financial and business services. The growth in the care sector accounted for the entire growth in non-commercial services. Lower investment in office and factory buildings pushed down output in the construction sector.
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