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The Netherlands is the main constituent country of the Kingdom of the Netherlands. It is a small, densely populated country located in Western Europe with three island territories in the Caribbean. The European part of the Netherlands borders Germany to the east, Belgium to the south, and the North Sea to the northwest, sharing maritime borders with Belgium, the United Kingdom, and Germany. The largest cities in the Netherlands are Amsterdam, The Hague, and Rotterdam. Amsterdam is the country's capital, while The Hague holds the Dutch seat of government and parliament. The port of Rotterdam is the largest port in Europe – as large as the next three largest combined – and was the world's largest port between 1962 and 2004. The name Holland is also frequently and incorrectly used to refer informally to the whole of the country of the Netherlands. "Netherlands" literally means "lower countries", influenced by its low land and flat geography, with only about 50% of its land exceeding one meter above sea level. Most of the areas below sea level are man-made. Since the late 16th century, large areas (polders) have been reclaimed from the sea and lakes, amounting to nearly 17% of the country's current land mass. With a population density of 408 people per km2 – 505 (July 2016) if water is excluded – the Netherlands is a very densely populated country. Only Bangladesh, South Korea, and Taiwan have both a larger population and a higher population density. England at 420 people per km2 is also more densely populated. Nevertheless, the Netherlands is the world's second-largest exporter of food and agricultural products, after the United States. This is partly due to the fertility of the soil and the mild climate. The Netherlands was the third country in the world to have an elected parliament, and since 1848 it has been governed as a parliamentary democracy and a constitutional monarchy, organized as a unitary state. The Netherlands has a long history of social tolerance and is generally regarded as a liberal country, having legalized abortion, prostitution and euthanasia, while maintaining a progressive drugs policy. In 2001, it became the world's first country to legalize same-sex marriage. The Netherlands is a founding member of the EU, Eurozone, G-10, NATO, OECD and WTO, and a part of the trilateral Benelux Union. The country is host to the Organisation for the Prohibition of Chemical Weapons and five international courts: the Permanent Court of Arbitration, the International Court of Justice, the International Criminal Tribunal for the Former Yugoslavia, the International Criminal Court and the Special Tribunal for Lebanon. The first four are situated in The Hague, as is the EU's criminal intelligence agency Europol and judicial co-operation agency Eurojust. This has led to the city being dubbed "the world's legal capital". The Netherlands is also a part of the Schengen Area.
The remarkable growth of Dutch involvement with the international capital market, especially in the second half of the 18th century, was mediated by what we now would call merchant banks. In Holland, these grew out of merchant houses that shifted their capital first from financing their own trade and inventories to acceptance credit, and later branched out specifically into underwriting and public offerings of foreign government bonds (denominated in Dutch guilders) in the Dutch capital markets. In this respect the domestic and foreign bond markets differed appreciably, as the Dutch government dealt directly with Dutch investors (as we have seen above).
Dutch involvement with loans to foreign governments had been as old as the Republic. At first, such loans were provided by banking houses (as was usual in early-modern Europe), with the guarantee of the State’s General, and often also subsidized by the Dutch government. An example is the loan of 400,000 Reichstalers to Gustavus Adolphus of Sweden around 1620 directly by the States General. When the king could not fulfill his obligations, the Amsterdam merchant Louis de Geer agreed to assume the payments in exchange for Swedish commercial concessions (iron and copper mines) to his firm. Similar arrangements between Dutch merchants and foreign governments occurred throughout the 17th century.
The transition to more modern forms of international lending came after the Glorious Revolution of 1688. The new Dutch regime in England imported Dutch innovations in public finance to England, the most important of which was the funded public debt, in which certain revenues (of the also newly introduced excises after the Dutch model) were dedicated to the amortization and service of the public debt, while the responsibility for the English debt shifted from the monarch personally, to Parliament. The management of this debt was entrusted to the innovatory Bank of England in 1694. This is one fell swoop put the English public debt on the same footing of creditworthiness in the eyes of Dutch investors, like the Dutch one. In the following decades, wealthy Dutch investors invested directly in British government bonds, and also in British joint-stock companies like that Bank of England, and the Honourable East India Company. This was facilitated as after 1723 such stock, and certain government bonds were traded jointly on the London and Amsterdam Stock Exchanges.
But this applied to a safely controlled ally like England. Other foreign governments were still deemed "too risky" and their loans required the guarantee, and often subsidy, of the State’s General, as before (which helped to tie allies to the Dutch cause in the wars against France). After 1713 there was no longer a motivation for the Dutch government to extend such guarantees. Foreign governments, therefore, had to enter the market on their own. This is where the merchant banks came in, around the middle of the 18th century, with their emmissiebedrijf or public-offering business. At first, this business was limited to British and Austrian loans. The banks would float guilder-denominated bonds on behalf of those (and later other) governments, and create a market for those bonds. This was done by specialist brokers (called entrepreneurs) who rounded up clients and steered them to the offerings. The banks were able to charge a hefty fee for this service.
The rapid growth of foreign investment after 1780 (as seen above) coincided with a redirection of the investment to governments other than the British. Many Dutch investors liquidated their British portfolios after the Fourth Anglo-Dutch War (which immediately resulted in a rise in British interest rates) and reinvested in French, Spanish, Polish (an especially bad choice in view of the coming Partitions of Poland), and even American government loans. The appetite for such placements abated a little after the first defaults of foreign governments (like the French in 1793), but even under the Batavian Republic (which itself absorbed the bulk of available funds after 1795) investment in foreign funds did not fall off completely. This may have been because Dutch investors did not always realize the riskiness of this type of investment. They were often badly served by the merchant banks, who had a vested interest in protecting their sovereign clients to the detriment of the bondholders. This is also indicated by the very slight agio of the interest rate of these risky loans over that for domestic bonds.
This apparent credulity on the part of the Dutch bondholders resulted in serious losses in the final years of the independent state, and during the annexation to France. The Dutch state for the first time in centuries defaulted after that annexation (a default that the new Kingdom of the Netherlands continued after the Netherlands became independent again in 1813). This tiercé (a dividing of the debt into two parts repudiated debt and one part recognized debt) followed the earlier repudiation of the French debt that had also devastated Dutch bondholders that had switched into French debt shortly before. The losses in the period 1793 to 1840 may have totalled between one-third and one half of Dutch wealth.
|Agriculture||Cereals, potatoes, grapes, olives & tomatoes.|
|Manufacture||Oil, petroleum, cement, machinery, automotive, ship, electrical, textile, footwear, plastic & ceramics.|
|Services (Including financial)||79.6% (2015 estimate)|
|SBM Offshore||Oil & Gas|
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The Amsterdam Stock Exchange is the former name for the stock exchange based in Amsterdam. It merged on 22 September 2000 with the Brussels Stock Exchange and the Paris Stock Exchange to form Euronext and is now known as Euronext Amsterdam. The Amsterdam stock exchange is considered the oldest “modern” securities market in the world. It was shortly after the establishment of the Dutch East India Company (VOC) in 1602 when equities began trading on a regular basis as a secondary market to trade its shares. Prior to that, the market existed primarily for the exchange of commodities. In that year, the State’s General of the Netherlands granted the VOC a 21-year charter overall Dutch trade in Asia and quasi-governmental powers. The monopolistic terms of the charter effectively granted the VOC complete authority over trade defenses, war armaments, and political endeavors in Asia. The first multi-national corporation with significant resource interests was thereby established. In addition, the high level of risk associated with trade in Asia gave the VOC its private ownership structure. Following in the footsteps of the English East India Company, stock in the corporation was sold to a large pool of interested investors, who in turn received a guarantee of some future share of profits. In the Amsterdam East India House alone, 1,143 investors subscribed for over ƒ3,679,915 or €100 million in today’s dollars.
The subscription terms of each stock purchase offered shareholders the option to transfer their shares to a third party. Quickly a secondary market arose in the East India House for resale of this stock through the official bookkeeper. After an agreement had been reached between the two parties, the shares were then transferred from seller to buyer in the “ capital book. The official account, held by the East India House, encouraged investors to trade and gave rise to market confidence that the shares weren't just being transferred on paper. Thus, speculative trading immediately ensued and the Amsterdam securities market was born.
A big acceleration in the turnover rate came in 1623, after the 21-year liquidation period for the VOC ended. The terms of the initial charter called for a full liquidation after 21 years to distribute profits to shareholders. However, at this time neither the VOC nor its shareholders saw a slowing down of Asian trade, so the States General of the Netherlands granted the corporation the second charter in the West Indies.
This new charter gave the VOC additional years to stay in business but, in contrast to the first chapter, outlined no plans for immediate liquidation, meaning that the money invested remained invested, and dividends were paid to investors to incentivize shareholding. Investors took to the secondary market of the newly constructed Amsterdam Stock Exchange to sell their shares to third parties. This “fixed” capital stock transactions amassed huge turnover rates and made the stock exchange vastly more important. Thus the modern securities market arose out of this system of stock exchange.
Total market capitalization: USD 651Billion
Total listed companies: 174
At the outbreak of the global financial crisis, the Dutch economy was assessed to be relatively well prepared to weather the storm, given it's very low unemployment level, large and stable current account surpluses, a low government debt level and, at that time, a budget in surplus. The fact that the Netherlands seemed to remain untouched by the (then) overseas problem, supported this view. Economic growth remained robust and above the euro area average throughout 2007. However, the negative effects of the financial crisis became more apparent in 2008 and economic growth came to a grinding halt in the second quarter. For 2009, GDP growth is expected to show the sharpest contraction ever and to be below the euro area average. In the wake of the crisis, typical Dutch strengths, like the pension system and its strong position in world trade, now have turned out to be vulnerabilities. On the other hand, the capacity of the economy to recover seems to be relatively robust in the Netherlands. It has a highly flexible labor market, low unemployment, and a very high participation rate. Furthermore, the government's budget surpluses of the past years enabled the government to allow the full working of the automatic stabilizers and to implement stimulus measures. Also, the low level of government debt enabled the government to intervene in the financial markets. Furthermore, the considerable current account surplus diminishes the Dutch dependency on foreign capital, making the country less dependent on changes in international capital flows. This does mean, however, that over the coming years a considerable fiscal adjustment will have to be made, not least to address the rising fiscal cost of aging and the cost of bank rescues, while occupational pension funds will have to recover their losses or adjust contribution and benefit rates. Hence, for all its comparative strengths, tough times are ahead for the Dutch economy.
The Netherlands has a developed economy and has been playing a special role in the European economy for many centuries. Since the 16th century, shipping, fishing, agriculture, trade, and banking have been leading sectors of the Dutch economy. The Netherlands has a high level of economic freedom. The Netherlands is one of the top countries in the Global Enabling Trade Report (3rd in 2014). As of 2013, the key trading partners of the Netherlands were Germany, Belgium, UK, United States, France, Italy, China, and Russia. The Netherlands is one of the world's 10 leading exporting countries. Foodstuffs form the largest industrial sector. Other major industries include chemicals, metallurgy, machinery, electrical goods, trade, services, and tourism. Examples of international Dutch companies operating in the Netherlands include Randstad, Unilever, Heineken, KLM, financial services (ING, ABN AMRO, Rabobank), chemicals (DSM, AKZO), petroleum refining (Royal Dutch Shell), electronic machinery (Philips, ASML), and car navigation (TomTom).
The Netherlands has the 17th-largest economy in the world and ranks 10th in GDP (nominal) per capita. Between 1997 and 2000 annual economic growth (GDP) averaged nearly 4%, well above the European average. Growth slowed considerably from 2001 to 2005 with the global economic slowdown but accelerated to 4.1% in the third quarter of 2007. In May 2013, inflation was at 2.8% per year. In April 2013, unemployment was at 8.2% (or 6.7% following the ILO definition) of the labor force. In July 2016 this was reduced to 6.0%. Economic growth in 2015 and 2016 (forecast) is about 2%. In Q3 and Q4 2011, the Dutch economy contracted by 0.4% and 0.7%, respectively, because of the European Debt Crisis, while in Q4 the Eurozone economy shrunk by 0.3%. The Netherlands also has a relatively low GINI coefficient of 0.326. Despite ranking 7th in GDP per capita, UNICEF ranked the Netherlands 1st in child well-being. On the Index of Economic, Freedom Netherlands is the 13th most free market capitalist economy out of 157 surveyed countries.
Amsterdam is the financial and business capital of the Netherlands. The Amsterdam Stock Exchange (AEX), part of Euronext, is the world's oldest stock exchange and is one of Europe's largest bourses. It is situated near Dam Square in the city's center. As a founding member of the euro, the Netherlands replaced (for accounting purposes) its former currency, the "golden" (guilder), on 1 January 1999, along with 15 other adopters of the euro. Actual euro coins and banknotes followed on 1 January 2002. One euro was equivalent to 2.20371 Dutch guilders. In the Caribbean Netherlands, the United States dollar is used instead of the euro. The Dutch location gives it prime access to markets in the UK and Germany, with the port of Rotterdam being the largest port in Europe. Other important parts of the economy are international trade (Dutch colonialism started with co-operative private enterprises such as the VOC), banking and transport. The Netherlands successfully addressed the issue of public finances and stagnating job growth long before its European partners. Amsterdam is the 5th-busiest tourist destination in Europe with more than 4.2 million international visitors. Since the enlargement of the EU large numbers of migrant workers have arrived in the Netherlands from central and Eastern Europe. Of economic importance is BrabantStad, a partnership between the municipalities of Breda, Eindhoven, Helmond, 's-Hertogenbosch and Tilburg and the province of North Brabant. BrabantStad is the fastest growing economic region in the Netherlands, with Brainport as one of the three national top regions and as a top region in the world. The region lies within the Eindhoven-Leuven-Aachen Triangle (ELAT).The partnership aims to form an urban network and to make North Brabant explicitly known as a leading knowledge region within Europe. With a total of 1.5 million people and 20% of the industrial production in the Netherlands is BrabantStad one of the major economical important, metropolitan regions of the Netherlands. Of all the money that goes to research and development in the Netherlands, one third is spent in Eindhoven. A quarter of the jobs in the region are in technology and ICT.
Of all European patent applications in the field of physics and electronics about eight per cent is from North Brabant. In the extended region, BrabantStad is part of the Eindhoven-Leuven-Aachen Triangle (ELAT). This economic cooperation agreement between three cities in three countries has created one of the most innovative regions in the European Union (measured in terms of money invested in technology and knowledge economy). The economic success of this region is important for the international competitiveness of the Netherlands; Together Amsterdam (airport), Rotterdam (seaport), and Eindhoven (Brainport) form the foundation of the Dutch economy.
The Netherlands continues to be one of the leading European nations for attracting foreign direct investment and is one of the five largest investors in the United States. The economy experienced a slowdown in 2005, but in 2006 recovered to the fastest pace in six years on the back of increased exports and strong investment. The pace of job growth reached 10-year highs in 2007. The Netherlands is the fifth-most competitive economy in the world, according to the World Economic Forum's Global Competitiveness Report.
Apart from coal and gas, the country has no mining resources. The last coal mine was closed in 1974. The Groningen gas field, one of the largest natural gas fields in the world, is situated near Slochteren. Exploitation of this field has resulted in €159 billion in revenue since the mid-1970s.The field is operated by government-owned Gasunie and output is jointly exploited by the government, Royal Dutch Shell and Exxon Mobil through NAM (Nederlandse Aardolie Maatschappij). "Gas extraction has resulted in increasingly strong earth tremors, some measuring as much as 3.6 on the Richter scale. The cost of damage repairs, structural improvements to buildings, and compensation for home value decreases has been estimated at 6.5 billion euros. Around 35,000 homes are said to be affected.
(King of the Netherlands)
the Dutch guilder was the currency of the Netherlands from the 17th century until 2002, when it was replaced by the euro. Between 1999 and 2002, the guilder was officially a "national subunit" of the euro. However, physical payments could only be made in guilder, as no euro coins or banknotes were available. The Netherlands Antillean guilder is still in use in Curaçao and Sint Maarten (two countries in the Kingdom of the Netherlands), but this currency is distinct from the Dutch guilder. In 2004, the Surinamese guilder was replaced by the Surinamese dollar. The Dutch name gulden was a Middle Dutch adjective meaning "golden" and the name indicates the coin was originally made of gold. The symbol ƒ or fl. for the Dutch guilder was derived from another old currency, the florin, called the florin in English..
The exact exchange rate, still relevant for old contracts and for exchange of the old currency for euros at the central bank, is 2.20371 Dutch guilders (NLG) for 1 euro (EUR). Inverted, this gives EUR 0.453780 for NLG 1.
The exact exchange rate, still relevant for old contracts and for exchange of the old currency for euros at the central bank, is 2.20371 Dutch guilders (NLG) for 1 euro (EUR). Inverted, this gives EUR 0.453780 for NLG 1. Before the introduction of the first guilder, there were regional and foreign gold coins that were likely referred to as "gulden" in Dutch. The first internationally accepted Dutch coin called gulden dates from 1517: the Carolusgulden (not to be confused with the English Carolus). Even before that, the County of Holland had minted golden coins since 1378. An early guilder, a 10.61-gram .910 silver coin, was minted by the States of Holland and West Friesland in 1680.
The original guilder design featured Pallas Athena standing, holding a spear topped by a hat in her right hand, resting with her left forearm on Gospels set on an ornate basis, with a small shield in the legend. This guilder was divided into 20 stuivers, each of 8 duiten or 16 penningen. The guilder gradually replaced other silver coin denominations circulating in the United Netherlands: the florijn (28 stuivers), the daalder (?1 1?2 guilders or 30 stuivers), the rijksdaalder (?2 1?2guilders or 50 stuivers), the silver ducat (?2 1?2 guilders or 50 stuivers) and the silver rider ducaton (3 guilders or 60 stuivers). Between 1810 and 1814, the Netherlands was annexed to France and the French franc circulated. After the Napoleonic wars, the Kingdom of the Netherlands readopted the guilder. In 1817 it became decimalized, with one guilder equal to 100 cents. However, it was not until the 1840s that the last pre-decimal coins (many of which dated back to the 17th century) were withdrawn from circulation, whilst some of the new, decimal coins continued to bear nicknames based on their values in the older currency system through to the 21st century. Until 1948, the plural of cent used on coins was center, after that it was sent.
The Netherlands was initially on a bimetallic standard, with the guilder equal to 605.61 milligrams of fine gold or 9.615 grams of fine silver. In 1840, the silver standard was adjusted to 9.45 grams, with the gold standard suspended in 1848. In 1875, the Netherlands adopted a gold standard with 1 guilder equal to 604.8 milligrams of fine gold. The gold standard was suspended between 1914 and 1925 and was abandoned in 1936. Following the German occupation, on 10 May 1940, the guilder was pegged to the Reichsmark at a rate of 1 guilder = 1.5 Reichsmark. This rate was reduced to 1.327 on 17 July of the same year.
The liberating Allied forces set an exchange rate of 2.652 guilders = 1 U.S. dollar, which became the peg for the guilder within the Bretton Woods system. In 1949, the peg was changed to 3.8 guilders = 1 dollar, approximately matching the devaluation of the British pound. In 1961, the guilder was revalued to 3.62 guilders = 1 dollar, a change approximately in line with that of the German mark. After 1967 guilders were made from nickel instead of silver. In 2002, the guilder was replaced by the euro at an exchange rate of 2.20371 guilders = 1 Euro. Coins remained exchangeable for euros at branches of the Netherlands Central Bank until 1 January 2007. Banknotes valid at the time of conversion to the euro may be exchanged there until 1 January 2032.
|GDP / GDP Rank||$869.4 Billion USD|
|GDP Growth Rate||1.9 percent|
|GDP Per Captial||$51049.02 (PPP)|
UTC+2 (CEST) (Summer)
1.1% Sikhism, Hinduism, Buddhism, Judaism
9.88% Other Europeans
Prime Minister- Mark Rutte (VVD)
|Website||Go to the web|
|Public Debt||62.6 percent of GDP|
|Unemployment Rate||6.2 percent|
|Labor Force (Occupation)||-|