- Private sector loses market share
- Unemployment 150 000 higher in two years
- EMU deficit in 2002 and 2003
As yet, the Dutch economy will only recover slowly from the economic downturn. Economic growth is expected to come out at 0.5% this year and at 1.5% in 2003. The pickup of the global economy is likely to be less exuberating than previously anticipated. However, the world trade volume which is relevant for the Netherlands, is expected to increase strongly by 7.75% next year.
The Dutch private sector might benefit from the upward trend in global trade, but the sharply increasing labour costs since 1998, and the strong position of the euro against the dollar put pressure on the Dutch competitiveness, causing a loss of market share for the private sector.
The government expenditures, which contribute significantly to growth this year, will barely increase in 2003 as a result of the planned spending cuts. As a consequence, the EMU deficit in 2002, forecast at 0.5% of GDP, will not grow further next year probably.
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(source: Netherlands Bureau for Economic Policy Analysis)