Now a constitutional monarchy headed by King Willem-Alexander, the Netherlands, (literally meaning “lower countries”, influenced by its flat geography), began as a republic in the 16th century, where it proceeded to become one of the world’s foremost maritime trading nations.
Today, the Netherlands, the sixth-largest economy in the European Union, plays an important role as a European transportation hub – Amsterdam Airport Schiphol is Europe’s third busiest airport and the Port of Rotterdam is the largest in Europe – and is well established in a number of industries including food processing, chemicals, petroleum refining, and electrical machinery. Moreover, the City of Eindhoven is home to Brainport Eindhoven – one of Europe’s leading technology regions, regarded worldwide as a hi-tech, innovation centre.
The Netherlands has also long been viewed as a nation that offers successful work/life balance. In 2017, the United Nations World Happiness Report ranked the Netherlands as the sixth-happiest country in the world, reflecting its high quality of life.
The Netherlands is home to several large multinationals. Royal Dutch Shell is the largest private company of the Netherlands by revenue and the second largest in the world after Exxon Mobil. Other well-known multinationals are Heineken, Philips, TomTom and Randstad, all of which have their headquarters in Amsterdam, whilst global giant Unilever is located in Rotterdam. Meanwhile, the Dutch financial sector is highly concentrated, with four commercial banks – ING Group, Rabobank, ABN AMRO, and de Volksbank – possessing over 80% of banking assets, four times the size of Dutch GDP.
Yet the Netherlands isn’t only about big business. Small and medium sized enterprises (SMEs) are a vital part of the local economy. There are approximately 752,000 SMEs in the Netherlands, with almost two-fifths (38%) involved in international activities, such as trade and investment. Most of these SMEs import and export products, but international co-operation and foreign direct investment also play a key role. The trading focus for SMEs in the country is predominantly with its EU partners, with Germany being the most important trade partner of Dutch firms. Dutch SMEs account for three million full-time jobs in the Netherlands, representing approximately 70% of total Dutch employment.
According to estimates from the European Commission, the Dutch economy will grow by 2% in 2017, a slight reduction from the 2.1% growth seen in 2016, with 1.8% growth forecast for 2018. Meanwhile, the Dutch central bank, De Nederlandsche Bank, predicts the Dutch economy will grow by 2.5% this year, the highest rate since 2007, boosted by further international trade and corporate investments. The Dutch economy was significantly impacted by the last financial crisis, but domestic spending is helping the country recover, and exports will contribute almost half of total GDP growth in 2017, according to De Nederlandsche Bank.
It is fair to say that the future looks optimistic for the Dutch economy today.