OREANDA-NEWS. The Dutch economy is expected to grow by 2% this year and next year. This will be the same rate of growth as in 2015 and is again broad-based. The recovery on the labour market will lead to lower unemployment in 2016 and 2017: 6?% in 2016 and 6% in 2017. The international risks, however, continue to dominate. This the message from the Rabobank economists in their Economic Quarterly published today.

The slow growth in the global economy is also slowing growth in Dutch goods exports. Bj?rn Giesbergen, national economist at Rabobank: ‘Besides exports, domestic consumption is also contributing to our growth, and so the economy continues to fire on all cylinders. Household consumption will rise further this year and next as the labour market continues to pick up and real wages rise. Those in work are also benefiting this year from tax reductions worth five billion euros. Households remain cautious though about increasing their consumption. But as the economy continues to grow, consumers may be slightly less cautious next year.’

Little reason for optimism concerning the global economy
The Dutch economy is however surroundedby international risks. The slowdown of growth in China, the political instability in the Middle East and the refugee problem that is partly related to this have not yet diminished in importance. The economic recovery in Europe is also far from convincing. Hugo Erken, international economist: ‘Eurozone GDP will return to its pre-crisis level this year. But behind this figure for the eurozone as a whole, the situation is in fact very diverse. In Southern Europe, for example, the picture is much worse than the average, especially on the labour market.’

A possible Brexit is also a risk. ‘Should the UK decide to leave the EU, this will mark the first step towards European disintegration, with consequences that are difficult to predict at this time. But even if the UK decides to remain, the referendum will leave its mark on the tenor of future European cooperation’, says Erken.

What’s more, the ECB’s monetary policy is encountering increasing resistance, particularly in Northern Europe. Erken: Now that it is clear that the possibilities available to the ECB are being exhausted, it is inevitable that greater emphasis will be placed on a stimulating budgetary policy of national governments. The European Commission, however, demands even more austerity in several countries, and this too creates a risk.”