COUNTRY FOCUS
NETHERLAND’S
ECONOMIC OUTLOOK
IN FIVE CHARTS
G
rowth in the Netherlands has picked up and
unemployment has fallen sharply in recent years. But
real wage and productivity growth have been slow,
possibly exacerbated by the increasing share of short-term
labour contracts. Finally, the high savings rate and low level
of domestic investment by large multinationals, as well as the
high debt and illiquid assets of households, are hindering a
pickup in the country’s growth potential.
1. The Dutch economy has grown faster than the euro
area average over the past few years, refl ecting recovering
consumption and investment, and strong net exports. Labour
market developments were favourable, with unemployment
reaching a historic low of 3.8 percent. However, wages grew
moderately, and infl ation remained subdued.
2. The current account surplus remains high at almost 10
percent of GDP, refl ecting high corporate savings by mostly
multinational corporations residing in the Netherlands. Slower
global trade and expedited phasing-out of gas production
should lead to lower exports and a modest rebalancing in the
short term. However, returns on a rising net foreign assets
position will preserve the large current account surplus over
the medium term.
Source: IMF World Economic Outlook.
Note: 2018 is an estimate.
Source: CBS, Eurostat, IMF BOP database, and IMF Staff calculations.
8 • Extraordinary and Plenipotentiary Diplomatist • Vol 7 • Issue 4 • April-May 2019, Noida