Caspian Energy (CE): Mr. Kamp, what do you think about the results of the outgoing year for the economy of the Netherlands and the EU in general? Which developments, in your opinion, helped the European economy get out of the prolonged debt crisis, and which ones on the contrary fostered its development?
Henk Kamp, Minister of Economic Affairs of the Netherlands: 2016 proved to be a prosperous year for the Dutch economy. With quarterly growth of 0.7% in the first three quarters of 2016, growth in the Netherlands compared favorably to economic growth in the Euro Area as a whole, which grew by 0.5, 0.3 and 0.3% respectively. For 2016 in total, economic growth in the Netherlands is projected to be 2.1%. As a consequence, GDP per capita is now back at pre-crisis levels while unemployment has reached its lowest level in over 4 years. Looking ahead, economic growth is projected to be robust and broad based. Consumer confidence is at a 9-year high, while producer confidence remains positive despite political uncertainties. In 2017 unemployment is projected to drop further below half a million, with economic growth projected to be 2.1%.
Regarding the EU in general, the economic recovery is getting more robust. Last year, economic growth in both the EU and the Euro Area were at the highest since 2010. In addition, Eurozone unemployment in September for the first time dropped below 10%. Looking forward, economic growth is projected to continue, albeit at a somewhat lower pace. In addition, unemployment in the Euro Area and in the EU as a whole is expected to show a downward trajectory in the coming years.
Prolonged uncertainty played a key role in the duration of the financial crisis and the relatively slow recovery. During the financial crisis there was a lot of uncertainty about the banking system, public finance, and even the future of the euro. Along with several other euro member states, the Dutch government restored the confidence of financial markets by taking measures to adhere to the Stability and Growth Pact. In addition, we have taken several policy measures that played a role in the recovery of the Dutch economy. We have taken steps to reform the housing market by lowering the maximum loan-to-value ratio’s and by gradually phasing out interest rate deductibility on mortgages, while we have also made efforts to bolster the banking system. In addition, we decided to lower the tax burden on labour by 5 billion in total, supporting domestic demand and boosting economic growth by 0.2%-points and 0.3%-points in 2016 and 2017 respectively.
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