Coronavirus impact on GDP growth rate in the Netherlands 2000-2021

According to quarterly pulse monitors, the Dutch economy will face a recession in 2020 due to the coronavirus and geopolitical events. This according to one of five sources in the Netherlands that presented an economic outlook for 2020. From 2018 to 2019, GDP in the Netherlands showed a 1.8 percent growth. On March 9, 2020, Rabobank economists calculated that a 0.7 percent of GDP growth was expected for 2020. The source originally noted, however, that this is not only due to the coronavirus outbreak. The Netherlands also was going to feel the future effects of the United Kingdom leaving the EU, as the UK was one of the Netherlands’ biggest trading partners. During March 2020, the Dutch economy was also negatively impacted by events such as the U.S. -China trade war or the sudden drop in oil prices. By June 2020, the 0.7 percent GDP growth forecast was revised to minus 5.7 percent.

Is COVID-19 going to have a bigger impact in the Netherlands than in other European countries?

According to a forecast from the European Commission conducted in July 2020, the Dutch economy suffered a GDP hit of 1.5 percent quarter-to-quarter in Q1 2020. In addition, a projected quarterly GDP decline of 11.5 percent was estimated in Q2 2020. Real GDP for the year 2020 was predicted to decline by 6.75 percent, a figure that was lower than real GDP losses predicted for other European countries. While the Netherlands successfully adopted emergency measures to protect employment, it was expected that the Dutch economy would be affected by lower private consumption and exports. Economic consequences in the Netherlands were predicted to be not as negative as in other countries. Belgium, for instance, was expected to face a GDP loss of 8.75 percent.

Back to reality: Dutch economic consequences so far

The coronavirus and its resulting quarantine measures caused, the largest decrease in domestic household consumption in the Netherlands in over 20 years. Restaurants were believed to be especially hit by the pandemic, whereas expenditure on food, beverages, and tobacco went up. Furthermore, between May and June 2020, the monthly unemployment rate of the Netherlands increased greatly. In January 2020, the seasonally adjusted unemployment rate for ages 15 until 75 years stood at three percent, whereas by July it had increased to 4.4 percent.