Growing export dependence Dutch manufacturing industry

20/04/2017 15:00
Out of every one euro earned by the Dutch manufacturing industry, 70 euro cents are generated by exports. In 2015, the Netherlands’ dependence upon foreign markets reached its highest point in two decades, as reported by Statistics Netherlands (CBS) on the basis of new research.
Export dependence is far greater in the manufacturing industry than across the overall economy, where it amounted to 32 percent in 2015. This percentage is relatively high in comparison with many other countries. Examples of industry sectors which have become increasingly dependent on foreign markets include food and beverage production.
Export dependence has increased gradually over the past two decades. The percentage declined during the economic crisis in 2009, but picked up again afterwards.

Value added in own exports and supplies to exporters

In 2015, Dutch manufacturers created over 71 billion euros in value added of which nearly 50 billion euros were due to exports. In addition, the manufacturing industry provided 700 thousand full-time jobs, of which 426 thousand were due to exports.
The highest-earning component were own exports of e.g. motor cars produced by the Dutch automobile industry. To a lesser extent, the sector earns revenue from supply of commodities for exportation by other businesses; for example, the metal industry supplying steel to the automobile industry.

Chemical industry relies most heavily on foreign markets

There are wide disparities among the various industry sectors. For example, 92 percent of the chemical industry is export-driven, whereas the furniture industry is much more focused on domestic demand with 29 percent export dependence. Large sectors including the public sector, education and care are much more focused on the domestic market due to their nature.
y
31,6
70,1
92,3
85,1
81,4
80,8
76,8
75,9
74,9
71,2
69,4
59,2
56,6
40,5
29,2

Importance of China has more than doubled

The top ten most important sales countries for the Dutch manufacturing industry is fairly consistent. In 2015, as in 2006, the six top-ranking countries were Germany, Belgium, the United Kingdom, France, the US and Italy.
China – in seventh place – is rising most significantly, coming from 14th place in 2006. China’s share in the Dutch manufacturing industry’s total export revenue more than doubled over a nine-year period, from 1.3 to 2.9 percent. At the same time, the shares occupied by the six highest-ranking countries (except the US) declined. The subsiding importance of traditional export markets is related to the comparatively greater economic growth in China (and other emerging markets).
y
19,7
10,5
8,8
8,3
6,4
5,2
1,3
3,4
1,7
1,9

Highly export-driven industry compared to global economic players

Compared to the world’s largest economies (US, China, Germany and Japan), the Dutch manufacturing sector is highly focused on exports. The domestic market in the Netherlands is much smaller than in these countries. As shown by OECD data, only Germany – manufacturing powerhouse and export champion – resembles the Netherlands in terms of export dependence being above average.
In comparison with similar-sized economies such as Denmark and Sweden, the Netherlands’ manufacturing industry relies somewhat more heavily on exports. Belgian manufacturers, on the other hand, are substantially less focused on foreign export markets.