Europe is in panic since the British majority voted for leaving the European Union. What does this means for the Netherlands and the Dutch economy?
According to new figures from the national statistics office CBS, the Netherlands earned €20.5bn last year exporting goods and services to Britain, the equivalent of 3% of GDP. This makes the UK the Netherlands’ second most important export market after Germany. Belgium is in third place, followed by the US and France, the CBS said.
A British withdrawal from the EU will cost the Dutch economy €10bn in lost income by 2030, according to calculations by the government’s macro-economic think tank CPB last week. The drop in trade with Britain will mount up to 1.2% of GDP within the next 15 years, the CPB said.
Of the total production of goods and services in the Netherlands, 3.7% is with demand from the United Kingdom. This creates 300,000 jobs, or 3.3% of the Dutch employment, calculated as ING. Within the EU, only Ireland and Malta are more dependent on the United Kingdom.
Is it really so terrible?
At this point, much depends on the deal that will be reached afterwards. With a Norwegian model (participation in the EU internal market in exchange for taking over EU rules), the market can largely continue. There are no import and export duties. But whether all EU countries would agree on this, is very uncertain.
"Until Friday morning, London was of course the financial capital of the world", says Boudewijn Poldermans, who accompanies Chinese investors in Europe. "But by the Brexit brings this position completely into question in the coming years". Companies do not want to sit and wait in the next two years for the economy regulative in the UK.
Possibly, the Brexit gives Amsterdam as an international business center "a push in the back". In the preparation for the referendum, a number of companies have decided to cross the North Sea to the Dutch capital. "I will not mention names of companies that came to usduring the past weeks, but it involves some Asian companies in the financial sector that have an office in London", says a spokesman for the Amsterdam alderman Kajsa Ollongren (Economic Affairs). She expects that within the coming weeks, this should be clearer.
On a longer term, Brexit could again be a threat to Amsterdam’s economy, she warned. "After the “pause” Great Britain will have a free hands to adjust the tax rules to be very attractive to some companies to establish themselves in this country".
Among others, some things are certain.The fall of the British pound resulted in:
- lower prices on British web-stores;
- London became number one travel destination after Brexit;
- Scotch whiskey is cheaper…
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