Dutch economic growth continues
The Dutch economy grew by about 2% in 2015 – twice as much as in 2014. This improvement is entirely driven by accelerating consumption and investment. For the first time in years their joint contribution to growth was greater than that of exports.
The economy is likely to grow at about 2¼% in 2016 and 2017, benefiting in both years from the weaker euro. The low oil price is currently still giving an additional impulse.
Despite this rosy picture, we have slightly reduced our growth estimates for 2015 and 2016 because of the unexpectedly meagre GDP growth in the third quarter of 2015 and the further scaling down of gas production in the province of Groningen in 2016.
The economy is slowly closing the growth gap. Owing to the protracted crisis, GDP has been largely static since spring 2008. Under normal conditions, the economy would have expanded by roughly 11% in that period. The ‘above-average’ growth expected for the years 2015-2017 points to a steady narrowing of this ‘gap’.
Thanks to the sustained economic acceleration, the number of jobs is gradually rising. Unemployment, however, will only fall slowly. The reason is that more people are entering the labour market in response to the economic upturn, but they are not all finding work.
Inflation was lower in 2015 than in the preceding year, partly due to the energy price slump. But 2016 will bring some modest inflationary pressures. These include more expensive imports due to a further fall of the euro and a probable increase in the oil price.
Though we expect the emerging economies to get on top of their current difficulties, their problems may also persist for longer than we assume. This could put a drag on the global economy, which would also affect Dutch economic growth.