The state of the economy: Statistics Netherlands presents 2019 annual figures at Erasmus School of Economics
On 13 February, Statistics Netherlands (CBS) presented the annual figures over 2019 for the first time at Erasmus School of Economics. The programme started with a reflection on the economy by Minister of Economic Affairs, Eric Wiebes. The figures were then presented by Peter Hein van Mulligen, chief economist at CBS. A panel discussion between minister Wiebes, van Mulligen, Bas Jacobs, Professor of Public Economics at Erasmus School of Economics, and Sandra Phlippen, chief economist at ABN AMRO, concluded the event.
6 goals to establish growth
The minister mentions that per-capita wealth increased with 25% in 2001, but most households did not notice this increase at all. This is because this increase in wealth was fully used to pay off the national debt and as an investment in pension funds and healthcare. Without any changes, economic growth would only amount to 1% for the coming 20 years. The government has therefore listed 6 objectives in a so-called growth plan. The goal is to increase economic growth for the coming 20 years to 1.5%, which would eventually amount to 100 billion extra in monetary terms. The 6 areas in which these goals are established are: education, labour participation, research & development, infrastructure, and climate change.
Economic growth lowest in 5 years
In the fourth quarter of 2019, GDP grew with 0.4% compared to the previous quarter, due to an increase in consumption and investments. However, economic growth for 2019 was only 1.7%; the lowest in 5 years. In 2018, GDP growth was 2.6%. In Europe, the Dutch economy did relatively well, with only Spain showing higher growth figures. Germany only experienced an 0.6% increase in GDP.
Statistics Netherlands also presented other figures related to the labour market and the trade sector. The number of jobs in the Netherlands has been increasing for the past 6 years and has continued to increase in 2019. The total number of jobs has increased with 153.000. Exports increased with 3.7% in the fourth quarter of 2019 in comparison to 2018. Consumption increased as well in the last quarter of 2019. The total consumption was 1.8% higher than in 2018.
"Dutch economy a 9? I’d give it a 6.5"
In the panel discussion that followed, Sandra Phlippen, Bas Jacobs, minister Wiebes and Peter Hein van Mulligen discussed the state of the economy and the role of the government in economic policy and the labour market. Bas Jacobs mentioned he found the 1.7% growth very disappointing. He does not agree with Klaas Knot, President of De Nederlandsche Bank, who rates the Dutch economy with a 9. Professor Jacobs believes the current state of the economy deserves an average 6.5 instead. Sandra Phlippen, however, was pleasantly surprised. At ABN AMRO, estimates for economic growth were below the actual numbers of Statistics Netherlands. These low estimates were related to events that occurred during the year that should have had a big impact on the economy, such as Brexit and the trade war between China and the US. Minister Wiebes is less satisfied with the current state of the economy. More than 40% of the Dutch are unhappy with their income. Wiebes believes it cannot go on like this and a lot of work still needs to be done in relation to the 6 objectives of the government's growth-plan.
Logical choice to present annual figures at university
This is the first time that one of the most important indicators of the Dutch economy has been presented outside the offices of Statistics Netherlands. "It is a logical choice for us", says Statistics Netherlands spokesman Thomas Ruigrok about the choice for Erasmus School of Economics. "We want to make our figures accessible to everyone and spread them as widely as possible, in the broadest sense of the word. Students are the policymakers and economists of the future.”