Coronavirus could put an end to Dutch economy's higher-than-expected growth
The Dutch economy is expected to grow by 1.4 percent this year and 1.6 percent next year, according to the latest estimations by central planning office CPB. The expected growth is slightly higher than previous estimations in December. The CPB warned that the effects of the coronavirus outbreak on the economy are still very uncertain, but the virus will negatively impact economic growth if it is not quickly gotten under control.
The current estimates on economic growth is based on the assumption that the coronavirus outbreak will quickly be dealt with. "It is clear that the coronavirus is already having a negative impact on the economy. If the spread of the virus is not stopped quickly, this will further have a negative impact on economic growth," CPB director Pieter Hasekamp said.
The Planning office also drew up a scenario in which the Covid-19 outbreak is not halted quickly and spreads further. In that case, the coronavirus will result in the Dutch economy growing only 0.5 percent in 2020 and 0.3 percent in 2021.
The Dutch economy's growth in the coming two years can mainly be attributed to more government- and consumer spending, according to the CPB. Tax cuts and higher wages due to the shortages on the labor market mean that Netherlands residents have more to spend. Purchasing power in the Netherlands is therefore expected to grow by 2.1 percent this year.