Netherlands: Economic and Political Outline

Economic Overview

The Netherlands entered into recession after the second trimester of 2008, the country was strongly affected by the international crisis due to its dependence on foreign trade.  Its GDP experienced a historic contraction of -4% in 2009. After the revival of global trade allowed the country to recover with a slow growth in 2010 (1.8%), growth again stalled in 2011 due to the fall in domestic consumption, stagnant housing market and especially the global slowdown penalizing exports. Suffering the effects of the crisis in the eurozone, the Dutch economy should enter recession in 2012.

The global economic crisis of 2008/2009 plunged public finance into the red, beyond the limits of the European Stability and Growth Pact. The government's priority is fiscal consolidation, with a goal of cutting the deficit to 3% of GDP by 2013. The government seeks to reduce spending, reform the welfare system and the financing of health care, unemployment benefits, public service and defense. The exemption system of mortgage interest payments, which weighs on public finances and creates high level of household debt, will also be revised. The implementation of reforms aimed at strengthening the financial sector and the management of an aging population is also crucial

The Netherlands presents high incomes per capita with an equal distribution of revenues.  The unemployment rate, which rose strongly since 2008, still remains at less than 5% of the active population.

Main Sectors of Industry

The agricultural sector represents 3% of the country's GNP. The profits from production are high and the use of the agricultural surface area is very intensive. Nearly 60% of the production is exported, either directly or through the food industry, what makes of the Netherlands the third exporter of agricultural products in the world. Cereals, potatoes and horticultural products are the main crops.
Industrial activity, practically, generates nearly a quarter of the GNP through food-processing, the petro-chemical industry, metallurgy and also the transport equipment industry. The Netherlands is also amongst the major producers and distributors of oil and natural gas.
Services account for more than 70% of the national income and they are mainly centered on transportation, distribution, logistics, banking and insurances.

Source: World Bank - Last Available Data.

Indicator of Economic Freedom

Score:

74.7/100

Position:

Mostly free

World Rank:

15/179

Regional Rank:

6/42

Distribution of Economic freedom in the world
Source: 2011 Index of Economic freedom, Heritage Foundation

Note: The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labor freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.

Sources of General Economic Information

Ministries

Ministry of Social Affairs and Employment
Ministry of Economical Affairs
Ministry of Agriculture and Fishery
Ministry of Finances

Statistical Office

Central Bureau of Statistics

Central Bank

Dutch National Bank

Stock Exchange

Amsterdam Exchange (AEX)

Other Useful Resources

Staten-Generaal
Tax Office

Main Online Newspapers

Het Financiel Dagblad (only in Dutch)
NRC Handelsblad (only in Dutch)
Algemeen Dagblad (only in Dutch)

Economic Portals

EVD
KB
EVD
KB

Political Outline

Type of State

A constitutional monarchy based on parliamentary democracy.

Executive Power

The chief of state is the Queen (visit the website of the royal family). Following parliamentary (lower house) elections, the leader of the majority party or leader of a majority coalition is usually appointed Prime Minister ( head of the government) by the monarch to serve a four year term. The Council of Ministers is appointed by the monarch on recommendation of the Prime Minister.

Legislative Power

A bicameral legislature. The parliament called States General consists of two chambers: First Chamber (upper house) and Second Chamber (lower house). The government has the right to dissolve the parliament, one or both the chambers.

Main Political Parties

- CDA (Christian Democratic Appeal) – Christian democrats,
- CU (Christian Union) - a orthodox reformed political party with more centre-left ideas,
- D66 (Democrats 66) - a progressive-liberal and radical-democratic political party,
- Green Left - an eco-socialist and anti-capitalist political party,
- PvdA (Labour Party) – a social-democratic political party,
- PVV (Party for Freedom) - a right wing party known for their hard stands on immigration
- SP (Socialistic Party) - a left wing party forms of the remainder of the communist party, extremely socialistic,
- VVD (People’s Party for Freedom and Democracy) - a centre-right, free market, liberal party.

Current Political Leaders

Queen: BEATRIX (since April 1980) hereditary
Prime Minister: Jan Peter BALKENENDE (since July 2002) CDA, heading a coalition government with the PvdA and CU until the next general elections in November 2010.

Next Election Dates

First Chamber: May 2011

Indicator of Freedom of the Press

World Rank:

4/179

Evolution:

same place compared to 2010

Source: Worldwide Press Freedom Index 2011, Reporters Without Borders

Note: The world rankings, published annually, measures the violations of press freedom worldwide. It reflects the degree of freedom enjoyed by journalists, the media and digital citizens of each country and the means used by states to respect and uphold this freedom. Finally, a note and a position is assigned to each country. To compile this index, Reporters Without Borders (RWB) prepared a questionnaire sent to partner organizations,150 RWB correspondents, journalists, researchers, jurists and activists of human rights, including the main criteria - 44 in total - to assess the situation of press freedom in a given country. It includes every kind of direct attacks against journalists and digital citizens (murders, imprisonment, assault, threats, etc.) or against the media (censorship, confiscation, searches and harassment etc.).