Economic growth stays 2.9 percent

06/07/2006 09:30

The Dutch economy saw robust growth in the first quarter of 2006. The Dutch gross domestic product (GDP) was up by 2.9 percent on the year before. However, the first quarter of 2006 did have two more working days than in 2005. The outcome of the second estimate is equal to that of the first estimate of 11 May. There are some adjustments on different items. Imports were higher, as were exports, stock increases and investments. Consumption was slightly lower than previously estimated, according to the second estimate by Statistics Netherlands.

Statistics Netherlands adjusted the figures for 2003, 2004 and 2005. The economic growth for each of the three years came out higher than previously published.

Slow quarter-on-quarter growth rate

The volume of GDP in the first quarter of 2006 was up by 0.1 percent on that of the fourth quarter of 2005. In the first estimate it was 0.2 percent. The quarter-on-quarter growth of 0.1 percent in the first quarter is clearly lower than in the preceding three quarters.

Economic growth broadly based

Economic growth in the first quarter of 2006 was substantially higher than the average of 2005. This is mainly because exports, investments and household consumption grew faster. Government consumption lagged behind. Exports remain the main source of economic growth. Apart from re-exports there was a robust growth of the export of Dutch products. Moreover, households spent more on durable consumer goods, which are usually imported.

From the perspective of the production side, retail and wholesale showed very high growth rates. This is due to the strong increase in exports and much increased retail sales. A great volume of natural gas was extracted for domestic and foreign buyers. The production in construction benefited from the recovery of housing construction, industry and exports. For the extra production, many entrepreneurs rely on temporary employment.

Upward adjustments for the economic growth 2003, 2004 and 2005

Economic growth for 2003, 2004 and 2005 was adjusted by 0.3, 2.0 and 1.5 percent respectively. For each of the three years, economic growth turned out higher than previously published. Both in 2003, 2004 and 2005 household consumption was higher than estimated before. Furthermore, in 2003 and 2005 investments grew faster. In 2004 the export balance was higher than previously calculated.

From perspective of the branches of industry, developments in the production of commercial services and in the manufacturing industry were more positive than estimated before.