Economic growth will decline in 2020 to 1.4 percent growth. This is stated in the August Estimation of the Central Planning Bureau (CPB), which serves as a starting point for the government when deciding on the budget and purchasing power for next year.
The declining growth is due to "bad wind from abroad", according to the CPB.
Unemployment is expected to reach its lowest point in 2019, but it will also be exceptionally low next year. Employment growth will fall in 2020 due to the continued increase in labor supply.
Purchasing power will continue to develop positively in 2020 as a result of the rise in real wages and, to a somewhat lesser extent, policy measures. There will also remain a surplus on the government budget, the CPB expects. That surplus will probably be smaller.
"The speed goes out"
"The turning point of the economic situation is behind us. The momentum is going out", says CPB director Laura van Geest. "Unemployment remains low, but employment growth is leveling off, especially in the market sector."
Developments abroad also ensure that the Dutch economy will have to rely mainly on domestic spending, Van Geest continues. The downside risks to the economy come mainly from US trade policy and responses, the chance of a no-deal Brexit and the political developments in Italy.
A more detailed analysis of the economic situation in the Netherlands is presented on Prince's Day, on 17 September. Then the Macro Economic Outlook 2020 (MEV) will also be published, with an explanation of the final estimate.
Second quarter 2019 was better than expected
On Wednesday, it was announced that economic growth in the Netherlands in the last second quarter of 2019 was pretty good at 0.5 percent. Lower growth rates are reported in the rest of Europe.
The economy is even shrinking in Germany. The largest economy in the eurozone was particularly affected by a decline in foreign trade. It is often said of Germany that its growth or contraction is contagious for the Netherlands, but so far it seemed to be too bad.
"German industry has been doing less for a long time and yet Dutch industry kept on turning," said Peter Hein van Mulligen, chief economist of the CBS. However, Dutch industry was faltering. "If that goes on for longer, it could well be that Dutch industry will shrink in the coming quarter. It remains to be seen what that means for growth."
See also: The Dutch economy is still growing, the German is not, and this is why
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