The Netherlands has one of the strongest economies in the world. For such a small country this is quite a feat. There are many factors that contribute to making the Dutch economy thrive. It has a wide variety of economic sectors that contribute to its strength and global reputation. They range from natural gas, to restaurants, to tulips.  You can read about them on this page. Plus, you can learn how this little country draws in so many skilled expats, like you!   

The strength of the Dutch Economy

The Dutch economy is small, but powerful:

  • The Netherlands is a country that exports one of the worlds largest volumes of goods. Globally, it is in the top 10 for this category
  • Holland also ranks in the world’s top twenty for GNP
  • This is very impressive given that, in terms of square kilometers, it is one of the smallest countries in the world! It only has a population of 17.9 million
  • Having said this, in terms of population density, it is on a par with countries like India and Japan

How does this little country manage to remain so dominant on the global economic stage?

Transportion Infrastructure in NL

The Netherlands has an advanced transportation infrastructure. This is part of the reason it is such a big economic player:

NL is the Gateway to Europe

The points listed above contribute to why the Netherlands is thought of, and often described as, the gateway to Europe’. There are other reasons too:

  • Traditionally, other countries are eager to invest in the Netherlands
  • The huge investments that have been made in the Dutch economy and Dutch companies, over several years, are evidence of this
  • This willingness to invest is largely due to the country’s stable and flexible work environment
  • The ‘Poldermodel’ has a lot to do with this
  • Holland’s central geographic location and its well-educated multilingual work force have helped as well

The Dutch ‘Randstad’

The Randstad is the area of the Netherlands that stretches over Amsterdam, The Hague, Rotterdam and Utrecht. This is how it contributes to the strength of the Dutch economy:

  • After Paris, London and Milan, the Randstad is the largest economic urban area in the EU, in terms of gross domestic product
  • This is largely due to the strong financial and commercial services it has
  • Such services happen to be some of the key motors of Dutch economy

Why Expats are Drawn to NL

Individuals who travel through the Netherlands are often enticed to relocate and find a job there. Perhaps this happened to you!

  • They are impressed and inspired by the opportunities the country offers its workers
  • This became more common after the frontiers within the European Union opened
  • The Dutch government has also introduced a number of tax measures, aimed at making the Netherlands more attractive for non-Dutch nationals to come and work here
  • The government recognizes the value of having top-notch specialists in the country, who can contribute to the knowledge pool and economy of the Netherlands
  • Employers and employees now have to navigate their way through far less bureaucratic red tape than they used to, in order to obtain the necessary papers to come here

Side Note

Flaws in the Dutch Economy

  • The economy of the Netherlands is relatively resilient
  • Still, Holland is a country of trade
  • This means that the health of its economy is dependent on the that of the rest of the world
  • If there is a drop in the world economy, the Netherlands will not be affected too quickly. However, it will not bounce back particularly fast either
  • This is due to the relatively high costs of labor in Holland. A lot of the country’s capital goes into wages and pension premiums

Key Sectors in the Dutch Economy

Machinery and transportation equipment are some of the most important trade commodities for the Netherlands. They are closely followed by chemical and mineral products. Here is a list of other dominant sectors of the Dutch economy:

  1. Services: This is the Netherlands’ most dominant sector. It accounts for approximately two thirds of both the country’s GNP and its work force
  2. Mineral extraction: The production of natural gas is an especially large sector in Holland
  3. The restaurant sector
  4. Trade
  5. Repair services
  6. Healthcare and related services 
  7. Agriculture and food: this sector generates approximately 10% of the country’s GNP. 75% of agricultural produce is exported from the Netherlands
  8. Chemicals: The Dutch economy benefits greatly from the fact that the world’s largest chemical companies are based in Holland
  9. High-tech goods: The Netherlands is one of Europe’s largest supplier. They are aimed at both the industrial and the consumer market

Oil and Gas in NL

  • As we mentioned earlier, the Netherlands is Europe’s second largest producer of natural gas. It has large reserves in the north of the country
  • Rotterdam imports and refines huge amounts of crude oil too
  • The oil is shipped to the rest of Western Europe
  • Thanks to these offshore installations and refineries, the Netherlands has many activities in the oil and gas industries
  • It has strong research and development technology
  • A specialized construction industry is another thing the country is proud of

Side Note

Dutch Tulips

The Netherlands is, of course, famous for its tulips! But what is the relationship between these lovely flowers and the Dutch economy?

  • The Netherlands exports 4 billion flower bulbs a year, most of which are tulips
  • 60% of these go to Germany, the UK, France and Japan, though the U.S. is their top destination
  • 900 million bulbs make their way across the Atlantic per year!

Welfare in NL

  • The Netherlands a wealthy country
  • It has a high per capita GDP
  • Social security measures boost this

Dutch residents are, therefore, guaranteed a minimum income, health care and education

Side Note

Statistics & Facts about the Netherlands

  • The total land surface area of the Netherlands is 33,948 km2/21,218 m. This excludes all inland and territorial waters wider than 6 meters/20 feet. If all the water surface area is included, the Netherlands has an area of 41,526 km2/25,954 mi2
  • The Netherlands’ North Sea coastline is longer (642 km) than its border with either Belgium (407 km) or Germany (556 km)
  • About 60% of the population lives below sea level
  • The highest point in the Netherlands is the Vaalserberg in the province of Limburg. It is 321 meters/1,053 feet above sea level
  • The lowest point in the country is 6.76 meters/22.18 feet below sea level. It is in the Prince Alexander Polder, northeast of Rotterdam (Nieuwerkerk a/d IJssel)
  • Head of State: King Willem-Alexander
  • Type of state: constitutional monarchy
  • Seat of government: The Hague
  • Capital: Amsterdam
  • Population: 17.9 million
  • ‘Non-Western’ non-native Dutch: 2.1 million
  • ‘Western’ non-native Dutch: 1.66 million
  • Number of households: 8.3 million
  • Average life expectancy for men born now: 80 years, for women: 83 years
  • Population growth: 220,000
  • Labor force: 9,7 million
  • Unemployment: 364,000
  • Unfit for work: 798,800
  • No. of jobs: 10 million
  • No. of self-employed persons: 1.2 million
  • Budget surplus: 0.4%
  • Consumer confidence: -33%
  • Most important trade partner: Germany
  • Modal income: € 40,000 gross
  • Average price of a house: € 421,300

Recently Posted on XPat.nl

If you’re an expat living and looking for work in the Netherlands then there are some vital differences you should know about in regards to your job applications. In the Netherlands, as with most places in Europe, the norm is a CV rather than the resume which is commonly used in the United States amongst … Continue reading "The Difference Between a Resume and a CV"
The Netherlands is the ideal starting place for a longer tour across Europe, regardless of whether you're new to the country or have lived here your whole life. And what better way to explore than by visiting some of the continent's most exuberant festivals – each one a celebration of culture, history and joyous living. … Continue reading "From the Netherlands to Europe’s Best Festivals"
Spring has sprung, and with that comes the start of hay fever season. If you’re part of the unlucky group that celebrates the start of spring by stocking up on hay fever tablets, you’re probably looking for ways to minimize your symptoms. In this article, we’ll tell you about some useful Dutch apps that’ll help … Continue reading "Helpful Dutch apps for hay fever season: here’s what you need to know"
Rising mortgage interest rates can have a significant impact on homebuyers and homeowners. The average interest rate for a fixed-rate mortgage in the Netherlands is currently around 4%. As interest rates increase, the cost of borrowing money to purchase or refinance a home also increases. This can make it more difficult for potential homebuyers to … Continue reading "Mortgage Interest Rates in the Netherlands in 2024"
It is that time of year again; the new and annually-updated version of The Holland Handbook is here and ready to be enjoyed! Not only that, but this is the 24th edition! More than twenty years ago, a modest group of three people sat around a table to discuss the possibility of creating a handbook … Continue reading "The Holland Handbook 2024"
Taxes are always complicated. If you have moved to the Netherlands from another country, they can be especially confusing! Many expats carry out business, and therefore earn an income, internationally. This makes what they get taxed on, and by whom, a complex matter. To figure out your own personal tax liability, your residency status and … Continue reading "Dutch Taxes"

Mortgage Interest Rates in the Neth ...

Mortgage interest rates can have a significant impact on homebuyers and homeowners. The average interest ...

30 ruling Netherlands

Dutch 30%-ruling Tax Facility

The 30%-ruling is a tax advantage, created for employees who are posted or recruited ...

Obtaining a Mortgage as an Expat in ...

Obtaining a mortgage as an expat in the Netherlands can be a complex process, as ...

Banking made easy with ABN AMRO

When preparing to live in another country, you are instantly faced with the hurdles of ...

Four Legal Differences You Need to ...

Relocating to any country is a big step. Aside from all the cultural differences and ...

Patchwork Family

‘Patchwork families’ are families made up of parents and children, whereby one – or both – of ...

Estate Planning: Is That What We’ ...

Don’t we all want the best for our children? We provide them with a ...

Divorce, Death and Inheritance in N ...

It is natural to believe that if you divorce your husband or wife you will ...

Inheritance tax in NL

It is a great gift to inherit anything from a family member or close connection ...

Legal Problems in the Netherlands

However law abiding a citizen you are, it is unlikely that you will never come ...