The Netherlands is one of the most developed countries in the world. The Netherland's GDP in 2009 was EUR 469.42 billion. GDP growth declined to 4.0% in 2009. In Q3 2010, the economy grew at a rate of 1.9%.

The Netherland's GDP in Q3 2010 was EUR 116,896 million compared to Q2 2010 when it was EUR 120,255 million.

(Source: Central Bank of Netherlands)      

The Netherland's GDP grew between 2000 and 2008. In 2009, the Dutch economy saw a decline in GDP due to the global economic financial crisis.

The Dutch economy was affected in the 2^nd half of 2008. This was because of the dependency of the Dutch economy on international trade and being one of the most open economies in the world. The Netherlands is mainly dependent on the export of goods and services. Merchandise and service trade contributes to more than 2/3 of  GDP. The Netherlands has always maintained a trade surplus and has never had a trade deficit. In 2007 the trade surplus was approx. USD 47 billion which declined to USD 43.2 billion and decresed again to USD 42.2 billion in 2009.

The Dutch economy is service driven. The service sector contributes to more than 3/4 of national income. Transportation, distribution, logistics, financial services and hotels are the major components of the service sector.

Industrial activity contributes approximately 1/4 to national income which includes food processing, metals processing, oil refining and the chemicals industry.

The Netherland's exports of goods and services in 2009 was EUR 378,040 million which was far less than in 2008 when it exported EUR 410,391 million worth of goods and services.

The Netherlands imported EUR 373512 million in 2008 and EUR 341,806 million worth of goods and services.

The Dutch economy shrank by almost 4% in 2009. The Dutch economy saw the number of exports drop in the first half of 2009, but started recovering in the second half of the year. Consumer spending decreased and the industry saw the lowest manufacturing capacity utilization in March. The number of bankruptcies increased sharply, there was a rise in unemployment and job vacancies almost halved in the first half of 2009. Approximaetly 7,000 businesses and institutions went bankrupt in 2009.The Netherlands’s manufacturing industry was hardest hit by the slowdown, which also affected transportation and the logistics sector.

(Source: Central Bank of Netherlands)

The Dutch government provided three stimulus packages in order to support the economy and stabalise it. The first package was worth USD 8.3 billion, the second package was designed to stimulate lending and was implemented through the relaxation of export regulations and the third package was worth USD 9 billion. The government’s main objective was to infuse liquidity into the system in the form of stimulus packages. After the announcement of the packages the government also assured the shareholders that it would not cut its spending until 2011. 

The Netherlands is a member of World Trade Organization (WTO) and the Organization for Economic Cooperation and Development (OECD).

(Source:Central Bank of Netherlands, state.gov)

Income Tax

Income tax on individual incomes in the Netherlands is taxed progressively from 0% to 52%.

Individual tax

Corporate income is taxed at 20% for the first EUR 200,000 and 25% for income above EUR 200,000.

The Netherlands has a flat rate of 19% VAT.

(Source: expatax)

Inflation rate

The inflation rate in the Netherlands in 2010 was 1.3%. The inflation rate in 2011 was 2.0%.

(Source: National Statistics)

(Source: Central Bank of Netherlands)

FDI Inflow

In 2009, FDI inflow was USD 33.29 billion in comparison to USD 5.69 Billion in 2008. In 2007 the Netherlands saw a record USD 120.4 billion of FDI inflows and coincided with the period when the economy was at its peak.

(Source: Central Bank of Netherlands)

Banking sector assets

The table below displays the total assets of the Central Bank of the Netherlands.

Currency Unit: Euro (million)

(Source: Central Bank of Netherlands)

Consumer price index

Base rate 2006 = 100

(Source: Central Bank of Netherlands)

The CPI in the Netherlands is rising steadily.

Interest rates on saving deposits/time deposits

The following rates apply;

·         Marginal lending rate: 1.75%

·         Fixed rate for main refinancing operations :1.00%

·         Deposit rate as of 13 May 2009: was 0.25%

·         Long term interest rates were 3.7% for 2009 and 3.0% for 2010.

The banks offer saving rates of 1.50% on deposits.

 (Source: De Nederlandsche Bank, De Nederlandsche Bank)

Government expenditure

In 2009, total government expenditure in 2009 was EUR 293,714 million, 51.4% of GDP. For the third quarter of 2010, total expenditure was EUR 71,920 million.

(Source: Central Bank)

Official exchange rate 2009

The value of the Euro against the US Dollars was 1.46 in 2009. The exchange rate of the Euro to the Japanese Yen was 131.21.

(Source: Bank of Finland)

Government finances

Revenue

The total government revenue in 2010 (up to the third quarter) was EUR 60,253 million. In 2009, total revenue was 46% of GDP.

(Source: Central Bank of Netherlands)

Current account balance - surplus/deficit

The Netherlands has had a current account surplus in the past five years. This indicates that the Netherlands is mainly dependent on the exports of goods and services for growth. In 2008 and 2009 the surplus declined due to lower demand for goods and services from other countries.

(Source: Central Bank of Netherlands)

Balance of payment account for the year 2009.

This shows that the Netherlands has maintained a surplus in the balance of payments (goods and services). Outflows of direct investments abroad by the Netherlands to other countries was EUR 20826 million and the inflows from other countries to the Netherlands was EUR 23437 million.

(Source:De Nederlandsche Bank (DNB)

The labour force in the Netherlands until the third quarter in 2010 was 7.87 million, a decrease of approximately 0.3% from the corresponding period in the previous year. Women accounted for about 44.6% of the total labour force in Q3 2010. The total unemployment rate in December 2011 was 4.8%.

(Source: National Statistics)

The labour regulations in the Netherlands are rigid. The cost of employing is high and removing an employee is costly and not easy.                                 

The net labour participation rate was 67.7% in the third quarter of 2010. The net participation for men and women was 75% and 60.3% respectively.

(Source: National Statistics)

Minimum wage

The minimum wage limit prevailing in the Netherlands has been in effect since 2011 and is EUR 1,424.40 per month.

(Source: Fedee)

Level of unionization

Approximately 1.9 million employees in the Netherlands are members of trade unions.

The main labour unions in the Netherlands include:

·         Christelijk Nationaal Vakverbond (CNV).

·         Federatie Nederlandse Vakbeweging (FNV).

·         Federation of Managerial and Professional Staff Unions (MHP)

The FNV consists of 19 unions which jointly represent approximately 1.4 million members. It is the largest and strongest trade union confederation in the Netherlands. The National Federation of Christian Trade Unions (CNV) is a Christian trade union federation and has more than 350,000 members. The MHP trade union federation is for middle and higher level employees.

 (Source: CNV, FNV, MHP)

The Netherlands is a parliamentary democracy under a constitutional monarch. The national government has three major institutions:

·         The Monarch

·         The Council of Ministers (Cabinet)

·         The State General (Parliament)

The Monarch is the representative head of state. The current Dutch monarch is Queen Beatrix. Queen Beatrix of the Netherlands has a role in the formation of the government and in the legislative process. The monarch does not have real political powers and is only the titular head of the state. The Monarch nominates mayors and political members who form the government after the general elections. The monarch also signs laws approved by the parliament. The parliament of the Netherlands has two houses - the upper house and the lower house. The upper house is the senate and the lower house is the House of Representatives.

The main political parties active in the Netherlands include:

·         The Liberal Party (VVD),

·         Labor Party (PvdA),

·         Freedom Party (PVV),

·         Christian Democratic Appeal Party (CDA)

The prime minister is Mark Rutte from the Liberal party and has been in office since October 2010.

In Dutch politics the change in government does not generally result in drastic changes in foreign or domestic policy.

Regulatory environment in Netherlands

The government in the Netherlands is based on a constitutional monarchy framework which means that the head of state is the representative of the people chosen by the people and is bound to govern by the constitutional laws.

(Source:Heritage.org)

The Netherlands economic freedom score is 74.7, making its economy the 15th freest in the 2011 Index of Economic Freedom. Netherlands ranks 6^th out of 43 regional countries in the Europe region. The Netherlands overall score is higher than the global and regional averages.

Corruption perception

The Corruption Perceptions Index (CPI) is a survey to measure the perceived level of corruption across countries worldwide. The Netherlands is ranked 7^th in 2010, indicating low corruption levels in the Netherlands. However, its ranking has slipped one position compared to the 2009 index. The Netherlands is less corrupt compared to neighbouring nations such as Belgium and Germany.

(Source: transparency.org)

Freedom of information

The Netherlands adopted the Freedom of Information Act in 1978. This was replaced by the Act on public access to Government information in 1991. This act provides citizens access to documents in possession of various public organisation and companies working on behalf of the public organisations.

(Source: epractice.eu)

The Netherlands is ranked first along with five other countries in the World Press Freedom Index 2010, indicating the media in the Netherlands is free and not restricted.

(Source: rsf.org)

Newspapers

The main newspapers circulated in the Netherlands include:

·         Algemeen Dagblad

·         NRC Handelsblad  

·         De Telegraaf  

·         De Volkskrant  

·         Trouw

·         Het Parool

·         Het Financieele Dagblad

·         Elsevier

·         Vrij Nederland

(Source: BBC)

Judicial system

The judiciary in the Netherlands consists of:

Supreme Court - based in the Hague, it is the highest court for civil, criminal and tax laws in the Netherlands

Special Tribunals- includes three special tribunals divided into specific areas of administrative law:

·         Central Appeals Tribunal: is the highest authority related to social security and civil services and is based in Utrecht.

·      Trade and Industry Appeals Tribunal: is also known as the Administrative High Court for Trade and Industry. It hears cases related to social-economic disputes. and is based in the Hague.

·         Administrative Jurisdiction Division of Council of State – is the highest administrative court in the Netherlands.

Courts of appeal

There are five areas the Court of Appeal covering jurisdiction over 19 districts. The Hague and Amsterdam are in the west, Arnhem in the east, s-Hertogenbosch in the south and Leeuwarden for the north.

District courts

The Netherlands is divided into 19 districts. Each district has its separate court, with each court taking up cases in the following sectors:

·         Sub-district sector

·         Criminal law sector 

·         Civil law/ family law sector

·         Administrative law sector

(Source:  Rechtspraak)

The total population of the Netherlands in 2010 was 16.574 million. The population growth rate per 1,000 people was 5.4%. The population density in 2010 was 491 per sq.km compared to 489 per sq. Km. in 2009.

(Source: National Statistics)

(Source: National Statistics)

The gender ratio in the Netherlands is balanced or almost equal. In 2010, the Netherlands had 102.05 women for every 100 men. The male population in the Netherlands in 2010 was 8,203,476 and there were 8,371,513 women.                                                                           

The average age for men is 39.1 years and 41.1 years for women.

(Source: National Statistics)

The Netherlands recorded 134,235 deaths in 2009 compared to 135,136 deaths in 2008. The death rate of inhabitants was 8.1 (per 1,000) in 2009 compared to 8.2 recorded in 2008.

The mortality rate for men was 6.1 (per 1,000) 6.6 (per 1,000) for women in 2009. The total infant mortality rate in 2008 was 698 which increased to 711 in 2009.

The average life expectancy in Netherlands for men is 78.5 years and for women it is 82.6 years (2009).

(Source: National Statistics)

In 2007, 81.3% of the population lived in urban areas. The urban population growth rate for 2005-2010 was 0.9%, whereas the rural population declined by -2.7% over the same period.

(Source: UN)

The majority of the Netherland's population, approximately 60% of the total population, is in the working age group (20 to 65 years). 23.7% of the population is aged 20 years and below, whereas people aged 65 years and above made up 15.3% of the total population.

(Source: National Statistics)

(Source: National Statistics)

The main ethnic groups in the Netherlands include:

·         Dutch

·         Moroccans

·         Turks

·         Surinamese

·         Dutch Caribbean

The main religions in the Netherlands include Roman Catholic, Protestant and Muslim.

(Source: State.gov)

Immigration in 2009 was recorded 146,378 people  and emigration in the same year involved 111,897 people.

(Source: National Statistics)

11% of the Netherland's total population lives below the poverty line. In the European Union, only the Czech Republic has a lower percentage of people living below the poverty line.

(Source: Eurostat)

The Netherlands ranked 7^th out of 169 countries on the United Nations’ Human Development Index 2010. It is amongst countries with very high human development. The HDI provides a composite measure of three dimensions of human development: living a long and healthy life (measured by life expectancy), being educated (measured by adult literacy and gross enrolment in education) and having a decent standard of living (measured by purchasing power parity, PPP, income).

(Source: UNDP)

The literacy rate in the Netherlands is estimated at 99%. Public expenditure is the government spending on educational institutions, education administration and the subsidies which the Dutch government provides for private institutions.

According to provisional figures, the total government expenditure on education in 2009 was EUR 33,926 million. This is 5.9% of GDP and is the highest in the past five years. The majority of spending was on primary and secondary education.

The graph below shows government expenditure on education as a percentage of GDP.

*- Provisional figures

(Source: National Statistics)

Health care

The laws for health care insurance (ZVW) have been in effect since 2006, to provide healthcare services to all citizens. The government provides compensation to households in the low income group, known as care allowance.

In 2009, the government spent approximately EUR 3.5 billion on healthcare allowances. The amount spent increased by  EUR 200 million in comparison to 2008. These allowances were paid out to more than 5 million adults. In 2008, the care expenditure per capita was EUR 4,809 and the total costs were 13.3% of GDP.

The main causes of death in Netherlands are neoplasm (cancer related) and the disease related to circulatory system. The Netherlands had 46,382 health care providers, including medical specialists and other practitioners. There were 789 municipal medical institutions in 2008.

 (Source: National Statistics, National Statistics)

The main mode of public transportation in theNetherlands are road and railway travel. Railways are operated by Nederlandse Spoorwegen. Trams and metro lines are an important part of public transport. The Netherlands also has good bicycle lanes as people prefer bicycles for their daily commute.

Roadways

The total length of roads in the Netherlands is more than 137,000 kilometres. 5% are dual carriageways.

(Source: National Statistics)

Railways

The railway network in the Netherlands is among the shortest in Western Europe. The total length of railway tracks in the Netherlands in 2007 was approximately 3,000 kilometres.

(Source: National Statistics)

Ports:

The main ports in the Netherlands include:

·         Port of Alkmaar

·         Port of Amsterdam

·         Port of Breskens

·         Brouwershaven Harbour

·         Ports of Delfzijl

·         Port of Den Helder

·         Port of Dordrecht

·         Port of Eemshaven

·         Port of Gorinchem

·         Port of Groningen

·         Port of Harlingen

·         Port of Hellevoetsluis

·         Port of Moerdijk

·         Port of Nijmegen

·         Port of Rotterdam

·         Schiedam Harbour

·         Zeeland Seaports

·         Scheveningen Port

·         Port of Tiel

·         Port of Vlaardingen

·         Port of Zaltbommel

·         Port of Zierikzee

·         Port of Zwolle

 (Source:World Port Source)

Airports

The Schiphol airport in Amsterdam is the main airport in the Netherlands and isalso one of the largest in Europe in terms of passenger traffic. Other major airports in the Netherlands include:

(Source: Air charter world)

Telecommunications networks

In 2010, 14.87 million people, representing 88.6% of the total population used internet services. This figure improved slightly in 2007, when internet users accounted for 88.4% of the total population.

(Source: Internet World Stats)

The following graph represents the percentage of the total population using the internet between 2000 and 2010.

(Source: internetworldstats)