Dutch economy to keep growing, but peak is over
The Dutch economy will continue to grow, but not as strongly as in the past years, according to new estimates by the Netherlands bureau for economic policy analysis CPB. Despite this, the Dutch economy continues to grow faster than the average in the euro zone, ANP reports.
The CPB expects that economic growth this year will amount to 2.6 percent of gross domestic product, and 2.2 percent next year. With that the CPB's outlook is slightly more positive than that of Dutch central bank DNB, which recently predicted 2.5 percent economic growth this year and 1.7 percent for 2019 and 2020.
The uncertainties that could affect economic growth in the Netherlands remain unchanged, according to the CPB. These include a trade war between the United States and China and the Brexit. The CPB also thinks that the 'yellow vests' protests in France and the Italian budget may pose risks.
The CPB also expects that unemployment will fall from 3.9 percent this year to 3.6 percent next year. Inflation will increase considerably by 2.4 percent next year, compared to 1.6 percent this year. That is partly due to the increase of the low VAT rate from 6 percent to 9 percent. However, wages are also rising and purchasing power will increase by 1.6 percent next year.
Public finances are also looking good, the CPB said. The government debt will fall to 48.9 percent of GDP next year, and the government will have a budget surplus of at least 1 percent for the third year in a row.