Netherlands: Fiscal deterioration

The economy underwent a strong contraction at the end of 2008 and in early 2009 as exports and private investment collapsed. However, unemployment has only recently started to increase, from a low level.

Overall, the economy will shrink notably in 2009, before slowly recovering in 2010 along with the pick-up in world trade.

Although the fiscal situation is deteriorating sharply, automatic stabilisers should be allowed to work fully and, if necessary, further discretionary fiscal action could be contemplated to support demand. The government should maintain its focus on active labour market policies to limit the increase in long-term unemployment. In order to assure fiscal sustainability, pension reform should be pursued.

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©OECD Observer No 274, July 2009

Economic data

GDP growth: -9.8% Q2/Q1 2020 2020
Consumer price inflation: 1.3% Sep 2020 annual
Trade (G20): -17.7% exp, -16.7% imp, Q2/Q1 2020
Unemployment: 7.3% Sep 2020
Last update: 10 Nov 2020

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