The Dutch economy 2012

The publication The Dutch economy 2012 is released today. The publication provides comprehensive and detailed information on the structure of the Dutch economy and economic developments in 2012. The first copy of The Dutch economy 2012 will be presented to the Dutch Minister of Finance Jeroen Dijsselbloem by Gosse van der Veen, Director General of Statistics Netherlands.

The years 2011 and 2012 were dominated by the ongoing economic crisis. The Dutch economy shrank by 1.2 percent, household consumption by no less than 1.6 percent. Although exports continued to grow, the growth rate of 3.2 percent was marginally below the level of 2011. The turbulence on the financial markets was reduced somewhat in 2012, as ECB president Mario Draghi vowed to do ”whatever it takes” to save the euro.

The German economy has outperformed the Dutch economy in recent years. Trade statistics show that German exports benefit more from emerging, rapidly growing economies like China than Dutch exports. The fact that Dutch and German exports are intertwined is not taken into account; Dutch manufacturing industry, for example, produces parts for the German (motor) industry. A recent analysis shows that this does not occur on a large scale. German manufacturing industry has indeed imported more spare parts in recent years, but the share of Dutch suppliers has remained stable. The share of China and various Central-European countries, on the other hand, has increased.

Since the onset of the recession in 2008, household spending has slumped. Dutch households have cut back drastically on home furnishing articles, alcohol and tobacco and hotels and restaurants in recent years, because household incomes have declined. The downturn on the housing market and reduced consumer confidence also play a part in this respect. In the countries adjacent to the Netherlands the situation is different. The populations in Belgium and Germany have seen their incomes improve in recent years and consumer spending in these countries is still growing. Belgian and German consumers also have more confidence in their financial future than the Dutch and they do not suffer from a faltering housing market.

In the Netherlands, the residential property market collapsed mid-2008. Residential mobility in particular among home-owning couples has been reduced dramatically. Most home owners do not move unless they are forced to, for example, if their household situation changes. Nowadays, if such a change occurs, couples tend to rent a house rather than buy one. Starters on the housing market more often opt for rental property instead of buying.

In the 1980s, the Netherlands also faced a persistent crisis, but the nature of the current crisis is obviously different. One of the main causes for the crisis in the 1980s was that the competitive position of the Netherlands was eroded as a result of excessive wage increases. Unemployment rose much more rapidly in the 1980s than nowadays and residential property prices plummeted. Unlike today, the number of private home sales remained fairly stable. The crisis of the 1980s was less enduring. After four years, for example, unemployment began to fall.