IMF now more optimistic about potential economic growth in the Netherlands

The International Monetary Fund (IMF) has raised its growth expectations for the Netherlands. The organization from Washington also expects stronger growth for the world economy.

According to the IMF, the Dutch economy will increase by 0,7 percent this year and is expected to grow by 1,5 percent next year. In the last primary estimate in April, the fund assumed pluses of 0,6 and 1,3 percent for the Netherlands.

The IMF lowered its growth expectations for the Netherlands twice in a short time earlier this year. It would not say why the prospects for the Netherlands are more optimistic now.

It is likely that the country's economy, which has always been very focused on trade, will profit from the fact that worldwide trade is increasing. The IMF slightly increased its forecasts for this in their latest estimates update.

Prospects for the eurozone are also looking more positive, although only modest increases of 0,9 and 1,5 percent are predicted.

The Netherlands's most important trade partner, the German economy, continues to struggle and has seen no changes from the IMF in its predictions.

The world economy as a whole will probably have a growth of 3,2 percent, as had earlier been predicted. Next year, growth should pick up to 3,3 percent, which is more positive than the fund thought a few months ago. This is mainly due to better prospects for the Chinese economy. The IMF has become slightly more gloomy about the United States.

IMF head economist Pierre-Olivier Gourinchas called it stable global growth but warned that there are still challenges in controlling inflation. According to the Frenchman, there is a danger that, for example, hard wage increases will stimulate inflation again.

Gourinchas also thinks governments should have their budgets more in order. "It is troubling that a country like the US is maintaining a budgetary course in which the debt ratio is continually pushed higher, posing risks to both the domestic and global economies."

As the Dutch IMF director Paul Hilbers recently said, Gourinchas pointed out the threat of economic fragmentation. He claimed that if countries continue to implement import fees on each other's products, this will disturb trade and cause lower economic growth. It will also make it harder to combat things like climate change.