The Netherlands: An Economic Powerhouse and Strategic Partner
When many people think of the Netherlands, pictures of tulips, windmills, dykes, masterful pieces of art, wooden clogs, and canals probably come to mind — images that have defined Dutch culture for centuries.
While those images remain relevant, they only tell part of the story behind the Netherlands, a longstanding innovative country of entrepreneurs who believe in promoting international trade and supporting peace, justice, and security around the world.
“We are proud of our heritage, but we are investing in our future, and such investment relies on healthy trade and a sustainable European economy,” said the Netherlands Ambassador to the US Henne Schuwer.
“We’ve always been a trading nation, which Americans can see through our longstanding economic ties,” he said. “Now, with the Netherlands Presidency of the EU in its early days, we hope to show the US, and the rest of the world, how the Dutch are partners who collaborate to ensure a strong global economy.”
The Netherlands as a Trading Nation
The Dutch have always traded with other nations, a legacy perhaps best shown in the Netherlands’ place in today’s global economy. Consider the following:
- Dutch exports totaled $671.8 billion in 2014, up 34.6% since 2010;
- the Netherlands is Europe’s second largest exporter after Germany, and the world’s sixth largest exporter, and;
- the Netherlands is the world’s second largest exporter of agricultural products, behind only the United States.
These numbers are merely the most recent snapshot of the Netherlands’ long history as a trading nation, a practice that took root four centuries ago on land that would later become the United States.
Dutch-American Economic Ties
In 1609, the Dutch ship, the Half Moon, landed on the shores of what is now Manhattan, planting the seeds for the economic ties between the Netherlands and the US today. That economic partnership has created hundreds of thousands of jobs, numerous sound investments, and countless promising opportunities.
And those economic ties keep growing stronger, with investments flowing both ways across the Atlantic Ocean.
For example, the United States is the No. 1 investor in the Netherlands, with $723 billion in investments. And with a $274 billion investment in the US, the Netherlands is a fixture in the top five largest foreign investors in America.
In fact, the economic ties between the US and the Netherlands support 685,000 American jobs, or enough to employ every resident of Washington, D.C.
“Our trading partnership with the US is the envy of many other countries,” Ambassador Schuwer said. “We will bring our experiences of that successful relationship to the table as we consider the economic policies of Europe during our Presidency of the EU.”
The Netherlands Presidency of the EU
The Netherlands will focus on four goals for the EU in these next six months:
- Migration and international security
- Europe as an innovator and job creator
- Sound finances and a robust eurozone
- Forward-looking climate and energy policy
While all these goals are important, one flows through the others: the economy.
Only with a robust economy will the concerns of migration and international security decrease. Only with faith in the economy will investments in innovation flow freely and create more jobs. And only with sound financial policies will the EU grow a circular economy that leads to a future-proof model of sustainable growth.
Keys to a Growing Economy
The global economy is growing again after a widespread and deep financial crisis.
“But just as athletes must exercise caution when playing again once they recover from an injury, world leaders must exercise prudence in the financial policies they create to support a growing economy,” said Ambassador Schuwer. “Few, if any, nations could exercise such prudence as well as the Netherlands.”
One only needs to look how Dutch leaders responded to the economic crisis within their own borders to determine how to apply similar policies to the EU as a whole.
As tax revenue plummeted because of the crisis, the Dutch government’s debt rose to ease the deficit. But higher debt inevitably leads to higher interest payments, creating an unsustainable long-term budget outlook.
Dutch leaders responded by implementing policies to put the Netherlands public finances back in order. Deep and responsible cuts to Dutch government budgets have eased the financial burden on taxpayers.
Zero-based budgets ensure the wise spending of public money. Civil servants no longer base next year’s budget on last year’s spending. When planning their budgets for next year, they now start with no money and must justify each euro spent.
The Netherlands even undertook the controversial choice of overhauling its respected pension system. Though many retirees and those nearing retirement did not like the cutbacks, the majority have accepted that the need for reductions helps ensure the nation’s financial health and long-term stability.
An Honest Broker
The Netherlands’ main task during the presidency is to serve as an honest broker who builds compromises among the EU’s 28 member states. As a hospitable, efficient, fiscally responsible, and innovative nation, the Netherlands is well positioned to fill this role.
To keep the EU financially healthy and ensure its long-term outlook, leaders must apply Dutch financial practices to EU measures. Dutch leaders have taken huge steps to place the Netherlands’ financial house in order, and feel strongly that the EU needs to live within its means.
“Only with a stable European economy will we be able to accomplish the other goals of the Netherlands presidency, and return the global economy to long-term, sustainable growth,” Ambassador Schuwer said.