Former ASML CEO warns the Netherlands faces tough choices to secure future prosperity

Former ASML chief executive Peter Wennink argues in a government-commissioned report that the Netherlands faces tough decisions if it wants to foster investment and maintain its standard of living. The report says that breaking the current deadlock over nitrogen emissions will demand changes in dairy farming. It also calls for a restructuring of the social-security system and notes that some heavily energy-dependent industries may ultimately need to shift their operations abroad.

In his report, Wennink examines what the Netherlands must do to ensure it earns sufficient revenue in the years ahead. He argues that, to maintain spending on health care, defense, and the energy transition, the economy should expand by 1.5 to 2 percent annually, well above today’s expected growth rate.

The report concludes that major investment will be essential, somewhere between 151 billion and 187 billion euros in additional spending by 2035. Those funds should flow to high-productivity, strategically vital fields like artificial intelligence, security, biotechnology, and climate-related technologies. Strengthening these areas would also help the Netherlands lessen its reliance on both the United States and China.

However, the report warns that the basic conditions for enabling such investment are lacking. It notes that permit procedures must be sped up, the strained electricity network requires expansion, and energy prices have to be reduced.

Wennink argues that agriculture is one of the areas where the most difficult choices must be made. He says the country can only break the current nitrogen impasse by implementing buyout programs in the cattle sector, which is a major source of nitrogen emissions in protected natural regions.

The report says difficult choices are also required in sectors that consume large amounts of energy. Wennink stresses that it would be best for the Netherlands to retain industries like steelmaking, refining, and chemicals, since they produce key inputs for advanced manufacturing and hold strategic value. The same priority, he notes, does not apply nearly as strongly to industries such as paper production.

According to the report, the labor market also requires significant reform. It notes that the current social-security framework is outdated and no longer suited to today’s economy. Wennink contends that start-ups and mid-sized firms can only expand if permanent jobs become easier to adjust and flexible positions provide stronger guarantees. As things stand, restructuring carries high costs, limiting companies’ ability to respond to changing conditions.

Wennink proposes appointing an independent commissioner to help the government accelerate the implementation of strategic initiatives. Wennink argues that a more decisive governing structure is essential to enable the level of innovation investment the country requires.

His report recommends creating a “Government Commissioner for Future Prosperity,” whose role would be to cut through interministerial hurdles and improve coordination between public bodies and private companies. The commissioner would not make political decisions; that authority would continue to rest with the Cabinet and Parliament.

Wennink calls for the establishment of a national investment bank with at least 10 billion euros in working capital, alongside a government agency with a 2 billion euro budget to promote innovation. He argues that such initiatives would more effectively leverage private investments and that long-term projects yielding productivity gains and growth should be given greater political priority than they are today.

De Unie labor union criticized Wennink’s report for overlooking the human factor. “Workers are treated as production resources and cost items,” says union chairman Reinier Castelein, noting that people are essential to the country’s earning capacity.

Commissioned by the government, Wennink’s report offers recommendations for the Dutch economy. “It correctly highlights numerous obstacles that limit the country’s business environment,” De Unie acknowledges. However, the labor group points out that the report falls short of presenting “a robust agenda for quality work, where employees can exercise autonomy over their lives.”

Wennink argues that fostering growth for start-ups and SMEs means loosening the rigidity of permanent contracts and giving flexible contracts greater security. “Acting as if permanent positions remain too inflexible and reorganizations too expensive ignores the significant sacrifices made in recent years,” Castelein emphasizes.

The CNV union likewise voices criticism of Wennink’s report. “Undermining social security and bringing back precarious employment will harm the economy,” the union argues. “Focusing on people and providing job security is what builds a strong economy.”

Wennink proposes, among other measures, ending the second year of employer-paid sick leave. CNV leader Piet Fortuin criticizes the plan as misguided. “It will likely increase the number of people entering WIA,” he warns. “A significant group risks being sidelined because re-entering regular employment becomes harder.” Fortuin adds that the unions were not consulted in preparing the report, calling that “strange.”