IMF predicts slower economic recovery in the Netherlands

2024-02-09 08:35:00

In 2023, the Dutch economy ultimately only increased in size by 0.1 percent, the new estimate shows. This year 0.6 percent growth is expected and next year 1.3 percent. At the end of January, the fund’s global estimates still assumed 0.2 percent in 2023, 0.7 percent this year and 1.3 percent growth for the Netherlands in 2025. And that was also a bleaker picture than the IMF had for a number of months. had outlined before.

The fact that the predictions are being adjusted once more so quickly is because researchers from the fund have conducted extensive research in our country in recent days. An IMF team also spoke with Dutch government officials and people from De Nederlandsche Bank (DNB) especially for this previously planned fact-finding mission.

These are still preliminary findings. The IMF is not very pessimistic regarding the Netherlands. “Although growth has slowed recently, the Dutch economy remains remarkably resilient,” the fund writes.

The fact that economic growth fell to a minimum last year is mainly due to the earlier increase in energy prices in combination with rising interest rates and reduced demand from abroad. In addition, the purchasing power of consumers took a major hit, which led to declining consumption figures in the first half of last year.

The IMF thinks that the economy actually improved somewhat in the last three months of last year. This recovery would have been mainly supported by increased wages and increased house prices. Industrial production and exports have not yet seen an upturn. Higher interest rates also put pressure on investments, according to the IMF.

An important positive point according to the researchers is that unemployment remains historically low and the demand for personnel at companies is still great. At the same time, inflation appears to be gradually decreasing, from 4.1 percent last year to 3 percent this year, before reaching 2.3 percent next year. According to the fund, the banking sector continues to look stable and the IMF sees improvement in public finances, despite the support measures taken to soften the impact of high energy prices.

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