Dredging firm Van Oord latest Dutch company expanding abroad due to domestic politics

Dredging company Van Oord will remain in the Netherlands, but its further expansion will happen at its office in Dubai. That decision to keep the headquarters in the Netherlands but expand abroad was made based on staff availability in the Netherlands and for tax reasons, among other things, outgoing CEO Pieter van Oord told the Telegraaf.

“We are a Dutch family business and are and will remain located here,” Pieter van Oord told the newspaper. He added that the Dutch market only accounts for 10 percent of the company’s total turnover. “It concerns two things: where do you want your head office to be located for tax purposes, and where do you get your talent from?”

“Asia has an unlimited labor market with a lot of talent. We have a large regional office in Dubai. There is a good chance that this will continue to grow in the coming years,” Pieter van Oord said.

The company, which became world-famous for building the palm island in Dubai, achieved a record turnover of 2.9 billion euros last year, an increase of 42 percent compared to 2022. The net result amounted to 127 million euros, a doubling compared to the year before. Van Oord is the largest ship owner in the Netherlands, with 60 ships sailing under the Dutch flag. It employs nearly 6,000 people, half of whom are in the Netherlands.

Several other companies have indicated that they intend to expand abroad instead of in the Netherlands due to local politics deteriorating the business climate. Two of the four parties currently negotiating a right-wing Cabinet - PVV and NSC - are expressly anti-immigration. That, combined with planned cuts to expat schemes and widespread staff shortages in the Dutch labor market, have companies worried about being able to attract the talent they need to expand.

ASML, the largest company in the Netherlands, has already threatened to expand abroad. And Van Oord competitor Boskalis has relocated part of its headquarters to Abu Dhabi in the United Arab Emirates, also explicitly noting the availability of talent from Asia in the region.

Another reason for Van Oord to expand abroad is due to the costs involved in the energy transition. Making business operations greener is very exciting, but leads to higher costs, Pieter van Oord told the Telegraaf. “It is a top sport to reduce emissions and convince the customer. We now make two quotes for companies: a normal one and a green one. Customers often don’t want to pay extra for being green. It is a big deal in Europe, but you don’t have to touch it in the Middle East. Family businesses think in generations, which takes the edge off this file,” Pieter van Oord said.

Pieter van Oord is stepping down as Van Oord CEO to take over at Schiphol Airport on June 1. His nephew, Govert van Oord, takes over the reins at the dredging company. The younger Van Oord said he would continue to “push” sustainability at the company. “Steps are being taken, but patience is needed.”