Manufacturers expect to invest more in 2011

  • Nearly all sectors of manufacturing expect investment to rise in 2011
  • Chemical industry very positive
  • Lower investment expected for 2010

According to Statistics Netherlands’ autumn survey of investment expectations, Dutch manufacturers foresee a 24 percent rise in investment next year compared with 2010.

Nearly all sectors of manufacturing expect to invest more in 2011. Companies in the chemical sector in particular are very positive: they expect investment spending to rise by 70 percent.

The chemical industry is the second largest investor among manufacturers. In 2009 it invested nearly 1.4 billion euro. Only the food, drink and tobacco industry invested more: nearly 1.7 billion euro. Manufacturers in the latter sector expect to invest 15 percent more next year.

Manufactures are more pessimistic about 2010. They predict a 21 percent drop in investment from 2009. Companies in the basic metal and metal products industry are the most negative. They anticipate investment spending in 2010 to be less than half the amount in 2009. This decrease is larger than the expectations voiced in the spring survey. One reason for this is that investments have been postponed to 2011 or later.

Manufacturing companies say the main reason to invest is to replace obsolete tangible assets. Both in 2010 and 2011, nearly 40 percent of investment spending is indeed used for replacement purchases. Just over 30 procent is used to expand production capacity.