Holland Compared Facts and figures, Summer 2015
Source: Rijkswaterstaat
GRONINGEN Groningen
Leeuwarden
FRIESLAND
Assen
DRENTHE
NOORDHOLLAND
NORTH SEA
Zwolle
Lelystad
FLEVOLAND
Haarlem
OVERIJSSEL
Amsterdam
's-Gravenhage (The Hague)
GELDERLAND
Utrecht
ZUIDHOLLAND
UTRECHT
Arnhem
Rotterdam
GERMANY
's-Hertogenbosch Middelburg
Breda
NOORD-BRABANT
ZEELAND
Eindhoven
LIMBURG
BELGIUM
Maastricht
UK GERMANY BELGIUM FRANCE
2
Official name Form of government Head of State Capital Seat of government Administrative structure
Surface area Location Number of inhabitants Number of inhabitants per km2 Monetary unit Languages
Kingdom of the Netherlands Constitutional monarchy, parliamentary democracy His Majesty King Willem-Alexander, King of the Netherlands, Prince of Orange-Nassau Amsterdam The Hague Twelve provinces and the overseas territories of Aruba, Curacao and St. Martin. The overseas islands of Bonaire, Saba and St. Eustatius, all three of which are situated in the Caribbean, are ‘special municipalities of the Netherlands’ 33,800 km2 Western Europe, by the North Sea, bordering Belgium and Germany 16,915,195 (April 2015) 500 (April 2015) Euro Dutch, Frisian
3
Source: Netherlands Enterprise Agency
4
Content Page Foreword
6
1.
General Information
8
2.
Macro Indicators
14
3.
Trade and Foreign Investment
24
4.
Holland Digital Gateway
36
5.
Top Sectors in Focus
46
6.
Human Capital and Innovation
66
7.
Infrastructure
80
8.
Government
86
5
Foreword Often referred to as Holland, the Netherlands has for centuries had one of the world’s most open economies. The Dutch engage in all forms of business all around the globe. Like many others, the Dutch economy was hard hit by the global economic crisis that began in the autumn of 2008. Nevertheless it has stayed relatively buoyant. The Netherlands continues to occupy a prominent position in world trade: in 2014, the country was the world’s fifth-largest exporter of goods. According to the World Economic Forum, the Netherlands currently has the eighth-best business climate in the world. Dutch conditions for investment and for setting up a business are also ranked highly by other institutes, like the IMD World Competitiveness Center. These high rankings are due to a number of factors. The Netherlands is widely considered a pleasant place to live, and the high productivity of Dutch workers has given it one of the highest per capita incomes of any country in the European Union.
6
The Netherlands has a great deal to offer the business community, and to foreign companies in particular. The country’s geographical location on the European continent is outstanding, and the Dutch have an open outlook and an international orientation. The workforce is well-educated and flexible – people often speak several languages – and the country has an excellent physical infrastructure. The Netherlands’ highly-developed IT network is another reason why it is such an attractive location for businesses: the Dutch have the second-highest number of broadband connections per head of population in the world. The Netherlands also excels in the use of IT by the general population, the business sector and government. This combination of factors may explain why the nation is the seventh-largest recipient of foreign investment in Europe. Yet despite all these factors contributing to their success, the Dutch refuse to allow themselves to become complacent. The government is constantly working to adapt and improve the Dutch business climate so as to meet the challenges of the future. This publication compares the Netherlands’ performance in these and other economic areas to that of other EU and OECD countries. If after reading this publication you still have questions about the quality of life or the business environment in the Netherlands, the team at the Netherlands Foreign Investment Agency (
[email protected]) will be glad to answer them.
Renée Jones-Bos
Secretary-General, Ministry of Foreign Affairs
7
Source: Energising the Future
1. General Information The Netherlands is traditionally the land of windmills, cheese and tulips, but isn’t this image something of a cliché nowadays? Well, not really. Centuries of expertise in land drainage (using the famous windmills) have made the Netherlands world-renowned for its water management skills. So what about the cheese and the tulips? The answer is that the Netherlands is also one of the largest exporters of agri-food and horticultural products in the world.
9
Brake on population growth Population by age (2014) 5 5 4 4
1 1
33
22
1.1.0-19 13.1% 5. 5. Older Olderthan than79 794.3% 4.3% 0-1922.9% 22.9% 2.2.20-39 20-3924.5% 24.5% 3. 3.40-64 40-64 23.3% 23.3% 4. 65-79 13.1% Source: Statistics Netherlands, 2014.
In total 16.9 million people live on the relatively small piece of land that is the Netherlands, which makes the country one of the most densely populated in the world. However, population growth is slowing down in the Netherlands, as it is in many other Western countries. This slowdown, together with an increasingly healthy generation aged 65 and above, has resulted in an ageing population.
10 General information
Attractive place to live Quality of life (2014)
9.73
Switzerland 9.55
Austria Norway
9.47
Sweden
9.44 9.38
Germany
Netherlands
9.21
Denmark
9.13
New Zealand
9.13
Australia
9.11 9.04
Canada Source: IMD, 2014.
Whether visiting for7 business the is9,5home to10a 7,5 or pleasure, 8,0 8,5 Netherlands 9,0 highly pleasant living environment. It currently ranks sixth worldwide in terms of quality of life. Leisure amenities are within easy reach and Dutch cities have much to offer, such as the centuries-old architecture of Amsterdam, Delft, Groningen and Leiden as well as cultural activities and world-famous museums such as the Van Gogh Museum and the Hermitage Amsterdam. Housing is also fairly affordable compared to other countries, according to IMD. In addition to the various international schools in the Netherlands, a large and growing number of schools (119 in 2013) teach in two languages (mostly Dutch and English). Finally, the Dutch healthcare system officially ranks among the world’s best. According to the Commonwealth Fund, the Dutch healthcare system is the best in the world in terms of quality, access, efficiency, funding and the healthy lives, on average, of the general population. General information 11
One of the most competitive economies Global Competitiveness Index (2014-2015)
Switzerland
5.7
Singapore
5.65
United States
5.54
Finland
5.5
Germany
5.49
Japan
5.47
Hong Kong, China
5.46
Netherlands
5.45
United Kingdom
5.41
Sweden
5.41 Source: World Economic Forum, 2014. 5
5,1
5,2
5,3
5,4
5,5
5,6
According to a number of international league tables published by renowned institutes such as IMD and the World Economic Forum, the Netherlands is among the world leaders when it comes to favourable business climate. There are numerous factors that form the basis for the favourable position that the Netherlands enjoys, including its open and international outlook, its strategic location in Europe, its well-educated, multilingual and flexible workforce, and the high level of labour productivity. The competitive fiscal climate, top-level physical and technological infrastructure and quality of life are key contributors to the country’s success. The Netherlands is thus an attractive location for companies seeking a European base and for those wishing to invest. 12 General information
Source: DSM N.V.
Source: Hannah Anthonysz/Rotterdam Image Bank
2. Macro Indicators The impact of the downturn in world trade as a result of the global economic crisis was immediately tangible in the Netherlands with its buoyant and open economy. However, the Netherlands continues to perform well on many fronts. For example, the Netherlands has one of the highest incomes per capita in the EU, Rotterdam is still Europe’s largest port and the Netherland’s high-quality ICT infrastructure ensures that the country remains the gateway to Europe.
15
Sixth-largest EU economy GDP in the EU (2014)
2,903,790
Germany 2,217,872
United Kingdom
2,142,022
France
1,616,047
Italy 1,058,469
Spain
653,476
Netherlands
436,342
Sweden
412,189
Poland
402,270
Belgium
328,996
Austria
Millions of euros. Source: Eurostat, 2015. 0
500.000
1.000.000
1.500.000
2.000.000
2.500.000
3.000.000
In terms of surface area and population size, the Netherlands is not a particularly large country and ranks 133rd and 64st worldwide. In stark contrast, the country’s economic performance ranks much higher. The size of the economy, or the Gross Domestic Product (GDP), is about 615 billion euros in 2014. The Netherlands has the seventeenth-largest economy in the world and the sixth-largest in the European Union.
16 Macro indicators
High average income GDP per capita (2013)
90,457
Luxembourg 54,133
Switzerland
51,689
United States*
44,176
Austria Sweden
43,497
Netherlands
43,416
Ireland
42,941
Denmark
42,777
Germany
42,549
EU-28
34,256 *= 2012 US dollars, corrected for Purchasing Power Parity. Source: OECD, 20.000 2014. 83.802 0 40.000 60.000 80.000
The Netherlands is one of the wealthiest nations in the European Union. The Netherlands also performs well compared to similar economies outside the European Union, such as that of the United States. The high average income in the Netherlands is the result of high productivity and a high level of labour participation.
Macro indicators 17
High productivity per hour GDP per hour, corrected for purchasing power parity (2013)
67
United States
61
Belgium
60
Netherlands
59
France 57
Germany Denmark
56
Ireland
56
Austria
55
Sweden
55 50
Switzerland
US dollars. Source: The Conference Board and Groningen Growth and Development Centre, 2014.
30
35
40
45
50
55
60
65
70
75
The working population in the Netherlands is highly educated, employees have an international outlook, and many speak more than one foreign language. This high level of education and the strong economic structure (enabled by the physical and the knowledge infrastructure, for example) allow employees to be productive. Labour productivity per hour is among the highest in the world. It is noteworthy that the Netherlands has combined this high level of productivity with a high level of labour participation, also among semi-skilled and unskilled workers.
18 Macro indicators
Prosperous, sustainable and enterprising Growth in GDP in % (2006-2013)
2.0
Switzerland 1.8
Sweden Germany
1.4
Austria
1.4 1.3
United States 1.0
Belgium Netherlands
0,7
France
0.7
Finland
0.7 0.6
Euro area
Source: Eurostat, 2014. 0
0,5
1,0
1.5
2.0
Compared to many other EU Member States, the Netherlands has a highly open economy, which is why the country was hit hard by the sharp downturn in world trade in 2008 and 2009. When considered over a longer period of time, the Netherlands shows reasonable economic growth compared to other prosperous EU Member States and the US. This is a good performance for a highly developed economy with a high standard of living (see also GDP per capita). The structural reforms that have been implemented in areas such as the labour market and the social security system, have created conditions for potentially healthy economic growth that offers room for investments in knowledge and innovation, for example, so that the Netherlands will remain a prosperous, sustainable and enterprising nation. Macro indicators 19
Moderate inflation Average annual inflation (2006-2013)
0.4
Switzerland
1.5 1.6 1.1
Ireland
1.7
Sweden
1.6 2.0
France
1.8 2.1 1.8
Germany Netherlands
2.2
Euro area
2.2
1.9 2.0
2.3
Denmark
2.4
Austria
2.0 2.2 2.32.6
Belgium
Average annual price increases as a percentage. Source: Eurostat, 2014.
The Netherlands enjoys a good reputation in monetary terms. Long before the introduction of the euro, price rises in the Netherlands were at a moderate level, thanks to sound monetary policies on the part of DNB (the Dutch central bank). The product and labour markets also operate relatively well, which helps to moderate price increases. According to the IMD (2014), the Netherlands ranks third worldwide in the fight against unfair competition.
20 Macro indicators
High labour participation rate Employment rates (2014)
75.879.7
Switzerland
74.9 75.7
Sweden
74.0 72.2
Germany Netherlands
71.6 73.9
Denmark
73.6 70.6
Austria
72.6 70.4 72.0 68.4
United Kingdom Finland
68.7 67.6
United States
. 68,5 67.5 66.3 65.7
OECD-countries Source: OECD, 2015. 0
10
20
30
40
50
60
70
75,8
In the last two decades, the level of employment in the Netherlands has increased by more than 30%. The strong growth in jobs is largely due to the structural economic reforms that have been implemented. The lack of unrest in the labour market - there are relatively few strikes in the Netherlands - is also a contributory factor as regards maintaining a favourable business climate. Thanks to the firm growth in employment, a large proportion of the potential working population is in work. Indeed, the proportion is considerably greater than the average of the OECD countries. Macro indicators 21
Many part-time employees Part-time work (2013)
39.9
Netherlands 25.4
Switzerland
25.1
Ireland
23.9
United Kingdom
22.8
Germany Denmark
19.8
Belgium
19.8
Austria
19.3 14.5
Luxembourg
14.3
France
Measured as a percentage of employment as a whole. Source: OECD, 2015. 0
5
10
15
20
25
30
35
37,1
A relatively high proportion of Dutch people work part-time. This is often a deliberate decision, allowing employees to combine work with caring for their family. From an international perspective, the number of people - and particularly women - in the Netherlands who work part-time is high: nearly 75% of all Dutch part-time workers are women. Nevertheless, the average working week for full-time employees is more or less on a par with most other Eurozone countries. The same applies to the number of hours worked in a year by full-time employees.
22 Macro indicators
Relatively low unemployment Average unemployment (2006-2013)
3.8
Switzerland
4.3 4.4 4.3
Netherlands
4.5
Austria
4.8
4.9
Luxembourg
5.5 5.8
Denmark
5.9
United Kingdom
6.96.3
United States
7.3
Germany
7.3 7.5
Sweden
7.1 7.8 8.3 8.4
Euro area
9.6
Measured as a percentage of the working population. Source: OECD, 2014. 0
2
4
6
8
The rate of unemployment in the Netherlands is one of the lowest in Europe. From 2006 to 2013, an average of 4.4% of the potential working population was unemployed, while the corresponding rate in the euro countries was 9.6%. As a result of the crisis the unemployment in the Netherlands increased. In February 2015 it amounted to 7.1% (Eurostat, 2015), compared to an average of 11.3% in the euro countries. Moreover, youth unemployment is also still low in the Netherlands. In February 2015, the portion of Holland’s potential working population aged under-25 that was unemployed amounted to 11.0%. In the EU-28, the average was 21.1%.
Macro indicators 23
Source: Netherlands Enterprise Agency
3. Trade and Foreign Investment The Netherlands plays a prominent role in the world economy due to its exports, imports, attracting foreign investors, and investments abroad. Its favourable location in relation to the European hinterland and its world-class infrastructure – such as the Port of Rotterdam and Schiphol Airport – have helped the Netherlands become an important distribution centre.
25
Open economy Dutch exports of goods and services
44.8
1970
49.8
1975
52.3
1980
62.1
1985 56.1
1995 2000
70.1
2005
69.6 83.2
2014 Measured as a percentage of GDP. Source: CPB, 2015. 0
10
20
30
40
50
60
70 72,6
The Netherlands has traditionally always had an open economy and the level of trade with other countries is very significant. According to research carried out by the Netherlands Bureau for Economic Policy Analysis, the Netherlands earns some 33% of its income from the export of goods and services. In 2014, the value of exports was 83.2% of the Netherlands’ GDP.
26 Trade and foreign investment
World’s fifth-largest exporter of goods Top 10 exporters of goods (2013) Millions of US dollars
Share in world exports (%)
China
2,210,523 12.3
United States
1,578,001 8.8
Germany
1,458,647 8.1
Japan
715,097 4.0
Netherlands
664,178
France
566,879
South Korea
559,619
3.7
3.2
3.1
United Kingdom
548,967 3.1
Russian Federation Italy
526,392 2.9 517,659 2.9 Source: World Trade Organisation, 2014
As the fifth-largest exporter of goods in the world, the Netherlands occupies a prominent position when it comes to world trade. In 2013, the Netherlands exported goods worth a total of almost 664 billion US dollars, which is about 3.7% of the world’s total exports. The Netherlands is also a significant exporter of commercial services: exports of commercial services amounted to 142 billion US dollars (110 billion euros) in 2013, which placed the country ninth in the world rankings. Trade and foreign investment 27
Strong in agri-food production Top 5 exporters of agricultural products (2013) Millions of US dollars
Share in world imports (%)
United States
175,567 10.4
Netherlands
111,458 6.2
Germany
99,232 5.5
Brazil
90,664 5.2
France
82,227 4.7 Source: World Trade Organisation, 2013.
The Netherlands is the world’s second-largest exporter of agri-food products. For decades, the Dutch agriculture sector has succeeded in maintaining its lead over international competitors through continual investment in innovation in agri-food value chains. The Netherlands is a hotbed of R&D in the area of agri-food, due largely to the excellent knowledge infrastructure and close collaborations between knowledge institutes, government and the private sector, the so-called “golden triangle”. Key R&D centres include Wageningen University and Research Centre (WUR), the Top Institute Food & Nutrition and the public-private innovation program FND+. Some 12 out of the 40 largest Food & Beverage companies in the world have R&D facilities located in the Netherlands. WUR is the foremost university in Europe in the field of agriculture, and second in the world, according to the Higher Education Evaluation & Accreditation Council of Taiwan. 28 Trade and foreign investment
Major importer of goods and services Top 10 importers of goods (2013) Millions of US dollars
Share in world imports (%)
United States
2,328,329 12.4
China
1,949,935 10.4
Germany
1,194,483 6.4
Japan
833,166 4.4
Hong Kong, China
703,872 3.7
France
668,658 3.6
United Kingdom
655,698 3.5
Netherlands
509,844 3.1
South Korea
515,573 2.7
India
488,442 2.6 Source: International Trade Organisation, 2014.
As well as being a major exporter, the Netherlands also imports large quantities of goods: 591 billion-US-dollars-worth in 2013. With a about 3.1% share of the global total, the country is the ninth-largest importer of goods in the world. The Netherlands is also a significant importer of commercial services - imports of commercial services amounted to 121 billion US dollars (94 billion Euros) in 2013, which placed the Netherlands eight in the world rankings. Trade and foreign investment 29
Most significant trading partner: Western Europe Geographical destination of Dutch exports (2013) 6 4 3 2
5
6
6
7
7
7
5 5 4 4
3 3
2 2
1
1. 2. 3. 4.
1. All of Europe 340.8 All of1.Europe All of340.8 Europe 340.8 2. All of Africa 14.4 All of2.Africa All of 14.4 Africa 14.4 3. All of North America 19.4 All of3.North All of America North America 19.4 19.4 4. All of Central and All of4.Central All ofand Central and South America 9,7 South America South America 9,7 9,7
5. 6. 7.
1
1
5. Near and Middle East 7.9 Near5.andNear Middle andEast Middle 7.9 East 7.9 6. Asia 39 Asia6. 39 Asia 39 7. Oceania 2.6 Oceania 7. Oceania 2.6 2.6
Values in billions of euros. Source: Statistics Netherlands, 2014.
The role of the Netherlands as a key distribution location is also indicated by the volume of import and export activities. Almost 79% of Dutch exports remain within Europe, especially Western Europe. Germany is easily the Netherlands’ most significant trading partner, followed by Belgium, the United Kingdom and France.
30 Trade and foreign investment
Gateway to Europe Geographical origin of Dutch imports (2013) 7 7
Sur ur
6
5
5
4
4 4
3
2. 3. 4.
6
5
3
3
2
1.
6
7
2
2
1. All of Europe 242.5 1. Europe All of Europe All of 242.5 242.5 2. All of Africa 15.4 2. Africa All of15.4 Africa 15.4 All of 3. All of North America 27.9 3. North All ofAmerica North America 27.9 All of 27.9 4. All of Central and 4. Central All of Central and All of and South America 16.6 South America 16.6 South America 16.6
1
1
1
5. Near and Middle East 10.5 5.and Near and East Middle East 10.5 Near Middle 10.5 6. Asia 70.1 6. Asia6.70.1Asia 70.1 7. Oceania 1.4 7. Oceania 1.4 7. Oceania 1.4
5.
Values in billions of euros. Source: Statistics Netherlands, 2014.
The Netherlands has become a key hub for distribution in Europe because of its favourable location in relation to the European hinterland and the country’s world-class air and sea ports such as the Port of Rotterdam (Europort) and Amsterdam Airport Schiphol. The Netherlands is home to more distribution centres than anywhere else in Europe and has the largest inland shipping fleet in Europe.
Trade and foreign investment 31
Dutch paints add a touch of colour to the world Composition of Dutch exports (2013) 9 9 9
10 10
1 1
10
1
2 2 2
3 3 3
8 8
4 4
8
4
5 5 5
7 7 7 6 6 6
1. 1.Animal feed and livelive animals 53.8 6. 6.Chemical products 74.6 Animal feed and animals 53.8 Chemical products 74.6 1.Beverages Animal feed and live animals Chemical products 74.6 2. 2. and tobacco 7.47.4 53.8 7.6.7. Manufactured goods 35.3 Beverages and tobacco Manufactured goods 35.3 2.Raw Beverages and tobacco 7.4 Manufactured goods 35.3 3. 3. materials, 8.7.8.Machinery and transportation Raw materials, Machinery and transportation 3.inedible Raw materials, 8. equipment Machinery108.6 and transportation (not fuels) 19.8 inedible (not fuels) 19.8 equipment 108.6 inedible (notlubricants fuels) 19.887.1 equipment 108.6 4. 4.Mineral fuels, 9. 9.Miscellaneous manufactured Mineral fuels, lubricants 87.1 Miscellaneous manufactured 4.Animal Mineral fuels, lubricants 87.1 9. goods Miscellaneous manufactured 5. 5. and vegetable 40.5 Animal and vegetable goods 40.5 5. Animal and vegetable goods 40.5 oilsoils and fats 4.34.3 10.10. Other goods 2.52.5 and fats Other goods oils and fats 4.3 10. Other goods 2.5 Values in billions of euros. Source: Statistics Netherlands, 2014.
The Netherlands is the second-largest exporter of agricultural products worldwide, after the United States. Horticulture is by far the most important segment within the agricultural sector. Other significant Dutch exports include chemical products (e.g. Sikkens paint), machinery (e.g. ASML lithography systems) and vehicles (DAF trucks and Scania trucks). The Netherlands is also a well-known exporter of high-quality aerospace components and systems (Fokker), ships (IHC Merwede), yachts (Royal Van Lent Shipyard) and busses and car parts (VDL Group). 32 Trade and foreign investment
Biggest trading partner: Germany Composition of Dutch imports (2013) 9 99
1010 10
1 11 2 22 3 33
888 44
5 55 7 77 1. Animal feed and live animals 35 1. 1. Animal Animal feed feed and and live live animals animals 3535 2. Beverages and tobacco 3.8 2.2. Beverages Beverages and and tobacco tobacco 3.8 3.8 3. Raw materials, inedible 3.3. Raw Raw materials, materials, inedible inedible (not fuel)s 13.8 (not (not fuel)s fuel)s 13.8 13.8 4. Mineral fuels, lubricants 95.9 4.4. Mineral Mineral fuels, fuels, lubricants lubricants 95.9 95.9 5. Animal and vegetable 5.5. Animal Animal and and vegetable vegetable oils and fats 4.8 oils oils and and fats fats 4.8 4.8
6 66 6. Chemical products 51.8 6.6. Chemical Chemical products products 51.8 51.8 7. Manufactured goods 34.9 7. 7. Manufactured Manufactured goods goods 34.9 34.9 8. Machinery and transportation 8.8. Machinery Machinery and and transportation transportation equipment 103 equipment equipment 103 103 9. Miscellaneous manufactured 9.9. Miscellaneous Miscellaneous manufactured manufactured goods 40 goods goods 4040 10. Other goods 1.4 10. 10.Other Other goods goods 1.41.4
Values in billions of euros. Source: Statistics Netherlands, 2014.
In 2013, 16.5% of all imports into the Netherlands originated in Germany. Almost half of all products purchased by the Netherlands in Germany were related to chemical products and machinery. Of all of the cars imported into the Netherlands, more than 90% came from Europe, particularly Belgium, France and Germany. Belgium (9.8% of total imports of goods) and China (8.3%) were respectively second and third Dutch import partner. In 2013 the value of Dutch imports (of goods) was 384.3 billion Euros. Trade and foreign investment 33
Seventh-largest foreign investor in the world Foreign investors in the world (2013)
6,350
United States China (incl. Hong Kong)
1,966 1,885
United Kingdom
1,710
Germany
1,637
France
1,259
Switzerland Netherlands
1,072
Belgium
1,009
Japan
993 732
Canada
Most important foreign investors in the world, in billions of US dollars. Source: UNCTAD, 2014.
500
510
520
530
540
550
Dutch businesses are truly international in their orientation. Dutch-based multinationals, such as AkzoNobel, Heineken, KPN, ING, Philips, Unilever and Shell have made substantial foreign investments in the past. The total value of Dutch investments in other countries is considerable. In late 2013, investments overseas totalled in excess of 1,072 billion US dollars, making the Netherlands the seventh-largest foreign investor in the world.
34 Trade and foreign investment
Attractive for inward foreign investments Main recipients of foreign investment in Europe (2013)
1,606
United Kingdom France
1,081 924
Belgium
852
Germany
747
Switzerland
716
Spain
670
Netherlands
576
Russian Federation Sweden
378
Ireland
378
Stocks, in billions of US dollars. Source: UNCTAD, 2014.
200
600
1000
1400
540 550
In 2013, foreign companies had inward direct investments worth 670 billion US dollars. As a result, the Netherlands is the world’s eleventhlargest and Europe’s seventh-largest recipient of foreign investment. In 2013 inward Dutch FDI stock amounted to 497.7 billion Euros or 82.2% of the Netherlands’ GDP. More than 6,300 foreign companies have established over 8,110 operations in the Netherlands. Among the many prominent international companies are firms like Abbott Laboratories, Boeing, Bombardier, Bosch, Cisco Systems, Danone, Dow, Eastman Chemical, Heinz, Hitachi, Huawei, ICBC, Medtronic, NCR Corporation, Reebok, RWE, Samsung, Siemens and Teijin.
Trade and foreign investment 35
Source: Netherlands Enterprise Agency
4. Holland Digital Gateway The Netherlands is a leading ICT innovator and a digital gateway to Europe. It has strong ICT infrastructure and an open innovation model that leads to high-level research. Moreover, the Dutch are keenly focused on cyber security and have developed various centres of expertise such as The Hague Security Delta. The Netherlands plays a key role in global Internet traffic. About a third of Europe’s Internet traffic with the US goes via the Amsterdam Internet Exchange. The quality of ICT infrastructure and security in The Netherlands makes it an attractive location for foreign investors: 25% are ICT related. 37
Holland’s ICT Playing Field Metropolitan Amsterdam Regional cooperation and innovation in the area of transport, distribution, and data processing (new media, social sciences, data infrastructure). Dominant players: Amsterdam Start Up Delta, Amsterdam Internet Exchange (AMS-IX), Science Park Watergraafsmeer, SURF.
Groningen Regional cooperation on focus areas big data and radio astronomy. Dominant players: IBM, Google, RUG, Astron.
East Netherlands Regional cooperation on focus areas e-Health and human capital. Dominant players: Roessingh Institute, TU Twente, health care institutions, businesses in the Health Valley.
The Hague The Hague Security Delta (HSD), largest security cluster in Europe. Public and private innovation in cyber security. Dominant players: Hague Security Delta Campus, Twente Safety & Security (TS&S), Dutch Institute for Technology Safety & Security, Brabant (DITSS).
38 HOLLAND DIGITAL GATEWAY
Eindhoven Regional cooperation on focus areas human capital and big data for industrial processes. Dominant players: ICT-driven companies such as Philips and various high tech suppliers, TU Eindhoven, Brainport.
The Dutch and ICT Strong in innovation, security and connectivity • The Netherlands is an international internet hub. It has the most competitive internet market and the second highest online connectivity in the world. 98% of households are connected to (broadband) internet compared to the European average of 62%. • The Dutch are active internet users: 91% of Dutch aged 16-74 compared to average 75% of Europeans in same age group. 75% of Dutch between 16-74 years have basic ICT skills. The European average is 59%. • Businesses from within and outside Holland invest in data centres and fibre optics connections in Holland, due to the country’s good digital infrastructure. • As a result, a third main-port of large economic importance has come into being: the digital hub. This hub has created 140,000 jobs (Research by Deloitte. In comparison, Schiphol airport has 166,000 jobs and the Port of Rotterdam, 184,000.) • For further economic growth, The Netherlands continues to invest in economic opportunities in the cyber domain and to stimulate research there • In addition, the Netherlands is committed to renewing laws and regulations that limit restrictions to digital innovation and growth. • The Netherlands actively supports the adoption of international internet standards and open and secure international internet hosting. • COMMIT is the biggest ICT research project in The Netherlands, including 100 ICT companies, users and universities, working together.
HOLLAND DIGITAL GATEWAY 39
40 HOLLAND DIGITAL GATEWAY
HOLLAND DIGITAL GATEWAY 41
Everyone’s into ICT Most advanced ICT economies (2015)
Singapore
6.00
Finland
6.00
Sweden
5.80
Netherlands
5.80
Norway
5.80 5.70
Switzerland United States
5.60
United Kingdom
5.60
Luxembourg
5.60
Japan
5.60 Source: World Economic Forum, 2015.
Research done in 20158,by the awarded Holland 7,5 WEF 7,6 into 7,7 network 7,8 5,5 readiness, 5,6 5,7 5,8 5,9 6 8,5 an excellent score: 4th place (in 2013 and 2014) in a list of 143 countries. The WEF-Networked Readiness Index (NRI) is one of the most comprehensive and authoritative assessments of the impact of ICT on competitiveness of nations and the well-being of their citizens. The NRI assesses the preparedness of an economy to fully leverage ICT in terms of: (1) ICT infrastructure, cost of access and the presence of the necessary skills to ensure an optimal use; (2) Uptake and use of ICT among governments, business and individuals; (3) Business and innovation environment, and the political and regulatory framework; and (4) Economic and social impacts accruing from ICT, and according to the International Telecommunication Union, the Netherlands ranks 7th among the world’s most advanced ICT economies, above countries such as Japan and the U.K. ITU’s ICT Development Index ranks 166 countries according to their level of ICT access, use and skills. 42 HOLLAND DIGITAL GATEWAY
HOLLAND DIGITAL GATEWAY 43
Leading the field in broadband Number of broadband connections (2013)
44.9
Switzerland 40.4
Netherlands
35.6 40.0
Denmark 37.6
33.9
France
33.5
Korea
32.8
Norway
United Kingdom 31.9
37.0 35.8
32.4
Iceland
37.5
35.2
30.4 Germany
34.8
30.3 Belgium
34.4 Measured per 100 inhabitants. Source: OECD, 2015.
28
29
30
32
33
34
35
36
37
38
39
40
41
42
43
44
In December 2013, the Netherlands had the second-highest number of broadband connections per 100 inhabitants in the world. Almost every household in the Netherlands can be reached by a cable or DSL connection. With the world’s largest digital data distributor, the Amsterdam Internet Exchange (AMS-IX), the Netherlands also has an outstanding data connection network, which is essential for businesses such as banks, insurers, internet-based companies and computer and advertising companies. 44 HOLLAND DIGITAL GATEWAY
Source: Netherlands Enterprise Agency
45
Source: Netherlands Enterprise Agency
5. Top Sectors in Focus In its economic policy, the Dutch government is focussing on nine business sectors that are key to Holland’s international trade and investment. These are sectors that are leading the way in innovation and sustainability, collaborating with Holland’s knowledge institutes on worldclass research and development. Expertise and products from these Dutch sectors is on demand around the world. Together, these sectors are the drivers of the Dutch economy.
47
Source: Netherlands Enterprise Agency
Agriculture & Food Sector World-leading supplier of agri-food products
• Holland is the world’s 2nd largest exporter of agricultural products, after the USA. Together with the USA and Spain, Holland is one of the top 3 exporters of vegetables and fruit. • The total value of Dutch agricultural exports was 80.7 billion euros in 2014. • In 2012 the Dutch agri-food industry contributed 48.7 billion euros of added value to Dutch GDP. • The Netherlands is the largest exporter of tomatoes and potatoes in the world. In 2013 the Dutch agrifood sector exported tomatoes to the value of about 1.8 billion US dollars. • Four out of the world’s top-30 food and beverage companies WORDT Three out of the world’s top-25 food and beverage companies. • The Food Valley region, centred at Wageningen University and Research Center, is one of the most authoritative agri-food and nutrition research centres in Europe. Wageningen University occupies the first place in the European ranking, and the second place worldwide in the QS World University Rankings by Subject 2014, in the category Agriculture & Forestry. • NIZO food research owns the largest food testing pilot plant in Europe and is open to the entire food and ingredient industry. • Holland is one of the world’s leading developers and manufacturers of food processing machinery. Dutch industry produces 80% of the world’s capacity of poultry processing machinery, and a substantial amount of cheese production machinery. • Dutch agricultural entrepreneurs use efficient and sustainable production systems and processes, resulting in a productivity that is five times higher than the European average. • Amsterdam is the largest cocoa port in the world.
TOP SECTORS IN FOCUS 49
Source: Green Chemistry Campus
Chemical Sector Chemical portal to Europe
• The chemical industry is one of the leading business sectors in the Netherlands, making a significant contribution to the economy. In 2013, the turnover was 57 billion euros. • The Netherlands is the world’s 5th ranking chemical exporting country. In 2013, Dutch chemical exports were valued at some 75 billion euros. • Holland is one of Europe’s leading suppliers of chemical products and services. • The competitiveness of the Dutch chemical industry lies in its internal and inter-company integration. Chemical companies work together on innovation and production, and take advantage of regional clustering. • The Netherlands hosts 16 of the world’s top 25 leading chemical companies, including BASF, AkzoNobel and Shell. • Holland is also home to world-class R&D institutes for fundamental and applied research such as TNO, Delft University, Twente University, Wageningen University and Eindhoven University. • Within the strong chemical community, the Dutch have formalized and structured the approach to co-operation. This is done with formal, long-term public-private partnerships (such as BE-Basic, the Institute for Sustainable Process Technology and the Dutch Polymer Institute) as well as through ‘open innovation’ in so called Centres for Open Chemical Innovation (COCI). The five COCIs are Chemelot; the Green Chemistry Campus; Plant One; Biotech Campus; and Green Polymer Application Valley. • In the area of advanced materials (polymers, composites, etc), the Netherlands consistently punches above its weight, producing world-renowned innovations in materials such as Twaron, Dyneema and Glare, as well as the folding tires for the automotive industry.
TOP SECTORS IN FOCUS 51
Source: Netherlands Enterprise Agency
Creative Industries Masters in architecture, design, fashion and gaming
• Holland’s creative industry ranks among the world’s top 10 in terms of trade figures, jobs and registrations of brands and patterns. • The annual turnover of Dutch creative industries is 32.8 billion euros. • Dutch architects are commissioned to design prestigious buildings around the world such as the Mercedes Benz Museum in Stuttgart, the CCTV Headquarters in Beijing and Battery Park in New York. Renowned Dutch architects/agencies include Rem Koolhaas (OMA), Francine Houben (Mecanoo), Ben van Berkel and Caroline Bos (UNStudio). • Holland has a long tradition of interior design, epitomized by Rietveld’s furniture designs. Marcel Wanders is currently one the world’s best known furniture designers. • Dutch fashion designers with international acclaim Viktor & Rolf, Spijkers and Spijkers, Iris van Herpen, Jan Taminiau and Marlies Dekkers. World-famous Dutch fashion brands include G-Star, Sandwich, Gsus and Supertrash. • Holland is the world’s 3rd largest exporter of television formats. TV producers such as John de Mol, Endemol and Eyeworks are the creative engine behind some of the world’s most popular TV shows, such as The Voice, Big Brother, Deal or No Deal, Obese and So You Wannabe a Popstar. • The Netherlands is a world-leading developer of computer games including serious games such as VStep’s Ship Simulator. Famous Dutch leisure games include Killzone and Age of Wonders. • The Netherlands is a pioneer in the area of dance music and large dance events such as Sensation. Dutch DJ Hardwell was voted world’s best DJ 2013 and 2014, and prior to that DJ Armin van Buuren was voted the world’s best DJ for five years.
TOP SECTORS IN FOCUS 53
Source: Netherlands Enterprise Agency
Energy Sector Innovative, sustainable energy solutions
• The Netherlands is a major natural gas producer and the source of advanced gas technology. Besides it is also Europe’s leading gas broker and a strategic gas hub. The country produced 84.9 billion cubic metres (bcm) in 2013; gas exports amounted to 67.3 bcm. • The distribution network for gas is the densest in Europe and of a very high standard. • The Dutch have unmatched capacity to cope with seasonal fluctuations in gas demand, providing north-western Europe with much-needed flexibility. • Holland has an international reputation for research in renewable energy, for instance in the field of solar energy, with institutes such as FOM and ECN, as well as various universities. The Dutch team from Delft University of Technology has won the World Solar Challenge, the biennial competition for solar cars, in 2001, 2003, 2005, 2007 and 2013. • The Dutch have leading expertise in offshore wind energy, co-combustion of biomass in coal-fired power plants, pretreatment methods of biomass, the use of landfill gas, and the use of heat pumps combined with heat and cold storage. • There is extensive experience in the field of energy efficiency due to a long tradition of multi-annual voluntary agreements on energy efficiency between Dutch industry and the government. This has made Dutch industry one of the most energy efficient in the world. • 7.5 million tons of municipal waste is converted in 13 efficient and clean waste incinerators to power, heat and reusable resources from the ashes. • The Netherlands is establishing itself as leader in green gas. ‘Green gas’ technology, the gasification of biomass, has been patented by Dutch energy company ECN. • The Netherlands plays a key role as a major oil-refining centre in Europe, with an extensive supply network of ports, storage facilities and pipeline connections playing a critical role for oil supplies to the continent.
TOP SECTORS IN FOCUS 55
Source: Netherlands Enterprise Agency
High Tech Sector New technologies for health, mobility, energy and security
• Holland’s high-tech sector is a world leader in the development of new technologies and materials for use in communication systems, aircraft and automobiles, medical devices, energy generation and semiconductor production. • Dutch companies invented WiFi, the CD and the DVD. Bluetooth was invented by Dutchman Jaap Haartsen. And high-tech equipment from Dutch companies are used in 90% of all silicon chips produced worldwide. • The Netherlands is strong in nanotechnology research. Dutch publications in nanotechnology are the most frequently cited by patents, compared to all other countries in the world. The country ranks 3rd in citation impact. • The Netherlands is also world leader in designing, developing and making high-tech equipment and micro/nano components. Characteristic features of this equipment are: highly intelligent (embedded systems, software, sensors); very precise (nanoelectronics, high precision manufacturing), and highly efficient (mechatronics and smart electronics) • Dutch multinational ASML is the world’s leading provider of lithography machines for the semiconductor industry. • In 2012 the export value from the HTSM sector was 45 billion euros, and the added value 42 billion euros. • The Netherlands has a world-leading position in the design and manufacture of milking robots. • In 2014, Tech United, a team from the Technical University Eindhoven (TU/e), became World Champion Robot Soccer for the second time at the RoboCup 2014 in Brazil.
TOP SECTORS IN FOCUS 57
Source: Netherlands Enterprise Agency
Horticulture Sector World’s leading supplier of flowers, plants and trees
• The Dutch horticulture sector is a global trendsetter and the undisputed international market leader in flowers, plants, bulbs and propagation material. • A quarter of the world trade in horticultural products (24%) is in Dutch hands. Holland has a 52% share of the worldwide trade in floricultural products, making it the dominant global supplier of flowers and flower products. Some 80% of all flower bulbs traded worldwide come from the Netherlands, the majority of which are tulips. • The sector is the number 3 exporter in nutritional horticulture products. • Dutch horticultural innovations include intelligent greenhouses that can float on water, moving platforms, robots, innovative lighting, water and waste recycling, and greenhouses that generate more energy than they consume and thus contribute to a reduction in CO2. • Of the approximately 1,800 new plant varieties that enter the European market each year, 65% originate in the Netherlands. In addition, Dutch breeders account for more than 35% of all applications for community plant variety rights. • The Dutch are the world’s largest exporter of seeds: the exports of seeds amounted to 1.6 billion dollars in 2014. • In 2014 the Netherlands was the world’s second largest exporter (in value) of fresh vegetables. The Netherlands exported vegetables with a market value of 7.8 billion US dollars.
TOP SECTORS IN FOCUS 59
Source: Enraf-Nonius
Life Sciences and Health Sector Helping to advance health worldwide
• The Netherlands ranks 4th worldwide in patent applications for medical technology and 9th in patent applications for biotechnology.. • With approximately 375 innovative life sciences companies clustered within a 120 mile radius, Holland is the most geographically concentrated region in the world when it comes to creating economic and social value in Life Sciences and Health. • Expertise in healthcare infrastructure is characterised by a turn-key plus approach: Dutch companies are able to cover all aspects from hospital design & engineering, financing, waste management, medical equipment etc. while paying special attention paid to energy efficiency and ‘healing environments’. • In 2011, Brainport Eindhoven’s Brainport region was named the world’s most intelligent ICT and health cluster. • The excellent medical research infrastructure is strongly focused on translational research in the different medical fields such oncology, cardiovascular, immunology and neuroscience. • The Netherlands is a global market leader in mobile health care, which enables the Dutch to contribute to rural health care in developing countries around the globe. • The industry annually exports around 37 billion euros in total of which 25 billion euros is pharmaceutical and the rest medical technology and medical and laboratory instruments. • The sector invests over 2 billion euros in R&D in the Netherlands each year and is becoming a globally recognized stronghold of open innovation. It already accounts for 2.5% of GDP. • Philips is the world leader in medical imaging and patient monitoring; DSM is a biomaterials leader. • The Dutch public-private partnership model, such as the Netherlands Genomics Initiative (NGI) and the three top institutes (TI Pharma, CTMM and BMM), have set an international standard.
TOP SECTORS IN FOCUS 61
Source: Netherlands Enterprise Agency
Logistics Sector Strategic gateway to Europe and the world
• The Netherlands was ranked 2nd in the 2014 World Bank global Logistics Performance Index (based on terms of efficiency and effectiveness of its customs, quality of transport, IT infrastructure for logistics and ease and affordability of shipping). • The Port of Rotterdam is the world’s 8th-largest and Europe’s largest port with a throughput of 445 million tons in 2014. From the Port of Rotterdam, all major industrial and economic centres in Western Europe can be reached in less than 24 hours. • In 2013, Schiphol won the ‘ACI EUROPE Best Airport’ award for the fourth time. Amsterdam Schiphol Airport won two awards at the 2012 Asian Freight & Supply Chain Awards: Best Airport in Europe and the Best Air Cargo Terminal in Europe. At the 2014 World Airport Awards air travellers voted Amsterdam Airport Schiphol the Best Airport in Western Europe. • According to the World Economic Forum, the quality of the Dutch infrastructure is among the best in the world, reflecting excellent facilities for maritime, air, road and railroad transport, ranked 1st, 4th, 5th and 9th, respectively in 2014. IMD Business School ranked the Netherlands first worldwide in 2014 with regards to the quality of its water transport infrastructure. • Dutch inland shipping accounts for 54% of all trade shipping in Western Europe. The Dutch fleet is, with 7,000 vessels, the biggest and most modern in Europe. 79% of all containers transported via inland navigation in the EU-28 countries passes through Dutch territory. • Over 1,000 American and Asian companies have centralised their European distribution activities in the Netherlands. The country hosts over 20 million square metres of distribution centres. • The Netherlands has the third cooling and freezing storage capacity in the EU.
TOP SECTORS IN FOCUS 63
Source: Netherlands Enterprise Agency
Water Sector World leaders in hydraulic engineering, water treatment and shipbuilding
• The Dutch are renowned for their integrated water management and multi-disciplinary approach that balances social, economic, environmental and engineering needs (‘Building with Nature’). Dutch companies are involved in the sustainable development of low-lying urban agglomerations such as Jakarta and Bangladesh, and coastal development in areas such as Dubai, Vietnam and Romania. • 40% of the freely accessible market for water management is in Dutch hands. • The Dutch Delta Works are listed in the Guinness Book of Records as the largest flood defence project in the world. With almost 16,500 kilometres of dykes and 300 structures, the project is one of the most extensive engineering projects in the world. The Oosterscheldedam is the largest single tidal barrier in the world, at 9km in length. • The Dutch invest heavily in innovation and R&D through publicprivate partnerships. These include renowned institutes such as Deltares, MARIN, Wetsus and KWR Watercycle Research Institute. TNO and large Dutch private firms are also recognised for their water R&D. • In the field of water technology and maritime technology, the Netherlands ranks 8th worldwide for global patents. • The Dutch began using innovative waste water treatment techniques in the 1970s. Some 99.9% of Dutch households have access to clean, entirely chlorine-free drinking water. Additionally, the level of recycling of industrial waste water is high, and this recycled water is of such high quality that it can be used in the food and beverage industries. • The Dutch maritime cluster comprises 12 sub sectors and 12,000 companies, which employ 224,000 employees. The cluster has a strong international focus: 60% of the seagoing ships produced in the Netherlands are destined for export.
TOP SECTORS IN FOCUS 65
Source: Netherlands Enterprise Agency
6. Human Capital and Innovation Dutch products are ‘typically’ highly innovative. The Netherlands provides solutions to keep rising water levels in check, create islands in the sea and make waterways navigable. Apart from solutions for use in the natural environment, the Dutch also have the knowledge and the skills to develop products such as navigation systems with worldwide appeal (TomTom). This capacity to innovate is evidenced by the large number of patents that are applied for every year, and by the presence of several world-renowned knowledge and research institutes in the Netherlands.
67
Well-educated working population Education level: upper secondary education (2012)
United States
89
Sweden
88
Switzerland
86
Germany
86
Finland
85
Austria
83
United Kingdom
78
Denmark
78
Ireland
73
Netherlands
73 Measured as percentage of population (25-64 years old) that has attained upper secondary education. 2014. 30 0Source: 10OECD,20 40 50 60 70
80
90
The internationally-oriented working population of the Netherlands is well educated, with many people able to speak more than one foreign language (European Commission, 2012). According to the EF English Proficiency Index, the Netherlands ranks third out of 54 countries. In addition to English, and in comparison with neighbouring countries, a good proportion of the population also speak German and French. According to the European Commission, the Netherlands has a world-class vocational education and training (VET) system, with built-in mechanisms to adapt to current and future skills needs so that training is more demand-driven. Furthermore, compared to many other EU member states, life-long learning is commonplace in the Netherlands: adults regularly engage in further education in order to continually improve their skills and knowledge levels. 68 Human capital and innovation
Dutch schoolchildren are second in the EU PISA Score
555
Singapore Hong Kong, China
554 543
South Korea Japan
540 535
Taiwan 529
Finland 522
Canada
519
Netherlands
518
Switzerland 515
Germany
Measured as PISA scores (points). OECD average = 500. Source: OECD, 2013
500
510
520
530
540
550
Dutch schoolchildren achieve good scores in the OECD Programme for International Student Assessment (PISA): fifth place within the OECD and second in the EU. The PISA survey is conducted every three years among 500,000 school pupils across 70 countries, and evaluates the capacity of 15-year-old schoolchildren to understand and solve academic problems. Moreover, according to the OECD the Dutch labour force is well equipped for the dynamic, fast changing IT-society of the 21e century. In comparison to other OECD countries, Dutch employees have leading positions in literacy proficiency, numeracy proficiency and proficiency in problem solving in technology-rich environments.
Human capital and innovation 69
Fourth most prosperous country Human Development Index (2014)
0.9440.971
Norway 0.933
Australia 0.917
Switzerland
0.915
Netherlands 0.914
United States Germany New Zealand
0.911 0.910
Canada
0.902
Singapore
0.901
Denmark
0.900
0.963
Source: United Nations Development Programme, 2014.
,58 ,69 ,60 ,61 ,62 ,63 ,64 ,65 ,66 ,67 ,68 ,69 ,70 ,71
According to the UNDP, the Netherlands ranks 4th place worldwide with regard to prosperity. In determining ‘prosperity’, the UNDP takes into account a country’s GDP as well as other aspects of human well-being, such as life expectancy, public health, literacy levels and educational standards. Of the 186 countries listed in the UNDP index, the Netherlands ranks 4th.
70 Human capital and innovation
Entrepreneurs create dynamism Number of entrepreneurs (2009)
12.2
Australia
1212.3
Canada
11.611.9
Netherlands Belgium
11.411.5
EU-27
11.311.5
Ireland
9.9
11.4
United Kingdom
9.7
11.4
8.8
Germany
9.8
8.5 9.3
Finland United States
14.4
6.9
9.3
Measured as a percentage of the working population Source: Statistics Netherlands, 2012.
The Dutch have always been well known for their entrepreneurial spirit, which is reflected in the country’s large number of entrepreneurs: 11.9% of the Dutch working population is self-employed. The Dutch government promotes start-ups because they create economic vitality and innovation and because they challenge existing firms, giving them the incentive to adapt and continue to innovate.
Human capital and innovation 71
Worldwide innovation index: fifth position Most innovative countries (2014)
64.8
Switzerland United Kingdom
62.4
Sweden
62.3 60.7
Finland Netherlands
60.6
United States
60.1 59.2
Singapore 57.5
Denmark
56.9
Luxembourg
56.8
Hong Kong, China
Source: INSEAD, 2014.
The Netherlands scores well the Global Innovation Index4,7(GII)4,82014.4,9 4 4,1 on4,2 4,3 4,4 4,5 4,6 The GII ranks 143 countries on parameters such as ‘institutions’, ‘human capacity’ and ‘business sophistication’, so as to arrive at a global innovation ranking for each country. The Netherlands scores particularly well on parameters such as ‘knowledge diffusion’, ‘online creativity‘ and ‘creative goods and services’. According to the Innovation Union Scoreboard 2015 (IUS) the Netherlands ranks fifth in the EU (European Commission/UNU-MERIT, 2015). The IUS distinguishes between 3 main types of indicators (enablers, firm activities and outputs) and 8 innovation dimensions (as human resources, research systems, finance and support, intellectual assets), capturing in total 25 different indicators.
72 Human capital and innovation
Source: Layar
Modest R&D expenditure R&D expenditure (2013)
3.32
Finland
3.21
Sweden Denmark
2.73.05
Germany
2.94 2.7
3.7
2.81 2.6
Austria
2.81
2.0
United States*
2.28
1.9
Belgium France
1.8
Netherlands
1.8
2.23 1.98
1.7
United Kingdom
1.63
Measured as a percentage of GDP *= 2012 Source: Eurostat, 2015.
1
1,5
2,0
2,5
3,0
3,5
3,8
At 2.16% of GDP, Research & Development expenditure in the Netherlands is modest from an international perspective (EU-average was 2.07% in 2012). However, this can partly be explained by the Dutch sector structure because the services sector, which ‘naturally’ has a low R&D intensity, accounts for a relatively large share of the Dutch economy. Public-private partnerships in scientific research are a major factor, and the Netherlands is ranked sixth worldwide in this area, according to the Netherlands Observatory of Science and Technology (NOWT) (2008).
74 Human capital and innovation
Home-grown knowledge multinationals Top 10 innovative Dutch businesses (2014) R&D expenditure (millions of euros)
799.5 4263
ASML
742 4013
Philips 249 1384
Royal DSM
244.2 1486
NXP Semiconductors Thales Nederland DAF Trucks VDL Groep
R&D personnel (FTE)
119 717 107.5 884 83 874
Synthon Friesland Campina Rijk Zwaan
69.4 212 66 520 65 466 *Calculated by TW. Source: Technisch Weekblad, 2015.
The Dutch economy has a broad and solid base. Leading multinationals with worldwide operations such as AkzoNobel, ASML, DAF Trucks, Heineken, NXP Semiconductors, Philips, Shell and Unilever have their roots in the Netherlands. Dutch industry includes a large number of innovative and knowledge-intensive companies that enjoy a sound reputation the world over and that carry out a great deal of R&D (including the aforementioned multinationals). In addition, there are also many other global businesses that conduct R&D activities in the Netherlands, such as Danone, Dow and Yakult. Human capital and innovation 75
Large base of knowledge and research A selection of knowledge and research institutes (2014) Budget in millions of euros
Personnel in FTE
626.4 3028
TNO 140 550
ECN Deltares
104
FOM
102
819 1019 74
NLR
643 59.1 347
KNMI MESA +
51
MARIN
42.7 366
578
30 60
J.M. Burgercentrum
28 177
TI Food and Nutrition
Source: Technisch Weekblad Special R&D, april 2015.
0
1000
2000
3000
4000
Dutch universities score quite highly for teaching and research in a number of international rankings (see: www.vsnu.nl). Wageningen University (WUR), for example, is a global leader in green biotechnology, and Leiden University leads the way in the biomedical life sciences (see box). In addition, the Netherlands is also home to a significant number of renowned knowledge and research institutes such as ECN and TNO, which play an important role in the government-initiated public-private innovation programmes.
76 Human capital and innovation
TNO Organisation for Applied Scientific Research ECN Energy Research Centre of the Netherlands Deltares Institute for Deltatechnology FOM Foundation for the Fundamental Research on Matter NLR National Aerospace Laboratory KNMI Royal Netherlands Meteorological Institute MESA+ Institute for Nanotechnology MARIN Research Institute in Hydrodynamics and Nautical Research J.M. Burgers- Research School for Fluid Mechanics centrum TI Food and Public private partnership for interdisciplinary research Nutrition in food and nutrition
Brainport Eindhoven Region is a top technology breeding ground for innovation and home to world-class businesses, knowledge institutes and research institutions. The five key target sectors are High Tech Systems & Materials, Food, Automotive, Lifetec and Design. Brainport Eindhoven Region is a powerful innovative player in a European and global context. It accounts for a third of all Dutch private R&D expenditure, and is one of Europe’s top three regions in terms of patent density. In 2011 the Intelligent Community Forum declared Brainport the world’s smartest region. In 2012 Fortune magazine suggested that this region could be the new Silicon Valley. Energy Valley is the energy cluster in the north of the Netherlands. The Energy Valley Region is an incubation zone for clean, reliable and innovative energy. The region is strategically positioned, centrally in the European gas and power grid, and directly at the North sea with excellent harbour facilities for transport of raw materials and offshore wind developments. Companies, knowledge institutes and governments work closely together to create a sustainable energy economy and new green jobs. Currently there are over 3,000 companies en 22,500 employees in the Northern energy cluster. Human capital and innovation 77
Dutch scientists frequently cited Citation impact (2009-2012)
1.63
Denmark 1.6
Netherlands 1.56
Switzerland 1.5
United Kingdom
1.49
United States Ireland
1.44
Finland
1.44 1.42
Norway Sweden
1.37
Belgium
1.37 Source: WTI2, 2015, data processing: Netherlands Enterprise Agency, 2015. 1,40
1,42
1,44
1,46
1,48
1,50
1,52
1,54
1,56
1,58
1,60
1,62
1,64
The citation impact score is a key indicator of scientific quality. The score refers to the number of times a scientist is cited by other scientists. These citations indicate how much they value each other’s work. The global average citation impact score is ‘1’. Dutch scientists are cited above the global average and claim third place in the world. Furthermore, Dutch scientists score highly for joint publications, which is evidence of the international significance of research taking place in the Netherlands. 78 Human capital and innovation
Refreshing business approach Number of PCT-patent applications (2013)
57,239
United States 43,918
Japan 21,516
China
17,927
Germany 12,386
South Korea
7,899
France
4,865
United Kingdom Switzerland
4,367
Netherlands
4,198
Sweden
3,960 Source: World Intellectual Property Organisation, 2014. 75
85
95
105 115 125 135 145 155 165 175 185 195 205 210213
PCT (Patent Cooperation Treaty)-patents are patent applications that are registered with the World Intellectual Property Organisation (WIPO). The Netherlands is well represented in this area and is ranked ninth in the world (fourth in the EU). Patents are in many cases the result of R&D activities which, if successful, can lead to greater labour productivity and an advantage over foreign competitors. This high score means that Dutch industry is an attractive potential partner - one that is innovative, inviting and stimulating. Human capital and innovation 79
Source: Amsterdam Airport Schiphol
7. Infrastructure The Netherlands has a number of key logistics hubs such as the Port of Rotterdam and Schiphol Airport, as well as a high penetration of broadband Internet. This provides the country with a sound physical infrastructure and consequently enables it to be a top performer in terms of logistics.
81
Navigable inland waterways Quality of water transportation (2014)
9.60
Netherlands Finland
9.10
Iceland
8.98
Denmark
8.97
Germany
8.79
Hong Kong, China
8.72
Singapore
8.72
Sweden
8.62
Canada
8.53 8.37
United States
Harbours, canals, locks, etc. Source: IMD, 2014. 0
2
4
6
8
9,6
The Netherlands has a good physical infrastructure, with the world-class (main)ports and the navigable inland waterway system being prime examples. The extensive network of inland waterways has excellent connections to the waterways in the rest of Europe. The Netherlands has the best water transport infrastructure in the world. The country also has an extensive road transport network and is second in the world as regards road network density (IMD, 2014). According to IMD (2014), the Dutch energy infrastructure also scores well, taking second place overall.
82 Infrastructure
Strong in logistics Logistics performance index (2014)
4.12
Germany 4.05
Netherlands
4.04
Belgium 4.01
United Kingdom
4.00
Singapore Sweden
3.96
Norway
3.96 3.95
Luxembourg 3.92
United States
3.91
Japan
Source: World Bank, 2014. 3,8
3,9
4,0
4,1
4,2
The Netherlands’ strong position in terms of logistics is due to the favourable geographic location of the country, at the heart of Europe; a sound infrastructure that includes the Port of Rotterdam, the Port of Amsterdam, Amsterdam Airport Schiphol; and a sophisticated logistics sector. This is reflected in the World Bank Logistics Performance Index 2014, where the Netherlands is ranked second. The Netherlands came out on top in terms of the efficiency and effectiveness of its Customs and other border procedures, the quality of its transport and IT infrastructure for logistics, the ease of use and affordability of its shipping, and the level of professionalism in the Dutch logistics industry. Infrastructure 83
Third-largest airport in Europe European airport traffic and transport (2013)
Cargo transport x1,000 tonnes Passenger transport x1,000 passengers
Frankfurt am Main
2,016
Germany
57,896
Paris Charles de Gaulle
1,877
France
61,985
Amsterdam Airport Schiphol Netherlands
1,531 52,528
London Heathrow United Kingdom
1,423 72,3333 Source: Schiphol Group, 2014.
In 2013, Amsterdam Airport Schiphol was Europe’s fourth-largest airport in terms of passenger numbers and third in cargo volumes, welcoming 52.6 million passengers and processing 1.5 million tonnes of cargo. A total of 99 airlines offer direct flights from Schiphol to 323 destinations. This makes Amsterdam Airport Schiphol one of the four most important Main Ports (or hubs) in Europe. It is also one of the two European home bases of Air France-KLM and the SkyTeam alliance. In addition, Schiphol is an important contributor to the regional economy, providing direct employment for around 65,000 people at the airport. The contribution to the national economy amounts to around 26 billion euros, and a total of 290,000 jobs nationwide. Schiphol is also renowned for its inspiring facilities for passengers and innovative technical solutions such as the extensive baggage handling system. The airport has won over 200 national and international awards since 1980. 84 Infrastructure
Largest port in Europe
9,743
Trans-shipment of goods (2013)
Trans-shipment (in millions of tonnes) Containers (in millions of TEU)
Netherlands
440.5
Rotterdam
11.6
Belgium
183.8
Antwerp
8.6
Germany Hamburg
132.2 9.3 Source: Port of Rotterdam, 2014.
The port of Rotterdam is the largest port in Europe. The trans-shipment in Rotterdam added up to 440.5 million tons in 2013. The number of containers handled remained at 11.6 million TEUs in 2013. Business often choose to locate in and around the Port of Rotterdam because of its strategic location in north-west Europe, its depth, the many port facilities, and its excellent links with the hinterland. Many companies from America and Asia use Rotterdam as their base for the distribution of goods throughout Europe. Work on the ‘Maasvlakte 2’ project is currently on-going. This historic land reclamation project will expand the area of the Port of Rotterdam. The first phase will be completed in 2014, which is when the first containers will cross the quay. The combined activities of the port account for about 5% of GDP. More than 90,000 people work directly for the port of Rotterdam.
Infrastructure 85
Source: Hans Kouwenhoven
8. Government The complex of buildings known as the ‘Binnenhof’ [‘Inner Court’] in The Hague is the seat of the Dutch government, which enjoys a good international reputation and functions effectively. The Netherlands is one of the most stable nations in the world with a competitive fiscal climate. Besides, government finances are relatively healthy.
87
Effective government Government effectiveness (2013)
Finland
2.2
Singapore
2.1 2.0
Denmark Norway
1.9
Switzerland
1.9
Canada
1.8
Netherlands
1.8
Sweden
1.8
Liechtenstein
1.7
New Zealand
1.7 Source: World Bank, 2015. 75
85
90
1
2
3
4
5
6
7
8
9
100
1
2 213
According to the World Bank, the government of the Netherlands is one of the most effective in the world, thus making it easier for companies to make medium and long-term decisions. The figures for government effectiveness capture the perceptions of the quality of public services; the quality of the civil service and the degree of its independence from political pressures; the quality of policy formulation and implementation; and the credibility of the government’s commitment to such policies. 88 Government
One of the least corrupt countries Corruption perception index (2014)
9.4 92.0
Denmark
9.3 91.0
New Zealand Finland
9.289.0
Sweden
87.0 9.2
Norway
9.086.0
Switzerland
8.986.0
Singapore
8.9 84.0
Netherlands
8,7 83.0
Luxembourg
8.7 82.0
Canada
8.7 81.0 Source: Transparency International, 2014.
0
10
20
30
40
50
60
70
80
90
According to the Transparency International Corruption Perception Index, levels of corruption and nepotism in the Netherlands are among the lowest anywhere in the world. Among the aspects of corruption that were examined were the degree to which people in authority - such as Customs officers, police officers, politicians, judges and other officials – misuse their position for personal gain (financial or otherwise). IMD (2014) also concludes that bribery and corruption are rare in the Netherlands: the country ranks sixth worldwide. Government 89
Moderate level of government debt National debt as a percentage of GDP (2013)
23.1
Luxembourg
40.6
Sweden
44.5
Denmark
57
Finland
73.5
Netherlands
74.5
Austria
78.4
Germany United Kingdom
90.6
Euro area
92.6 93.5
France Source: Eurostat, 2014. 0
10
20
30
40
50
60
70
80
90
The Netherlands was able to dramatically reduce its level of government debt in the years preceding the global economic crisis thanks to a stable economy and a reasonably stringent fiscal policy. In 2008, there was even a budget surplus for the third consecutive year. In 2014, Dutch government debt as a percentage of GDP was higher than the EMU standard of 60% (69.0%), but it was still well below the average for the Euro zone (90.9%). According to the CPB – Netherlands Bureau for Economic Policy Analysis – the budget deficit will amount to 1.8% of GDP in 2015 and 1.2% in 2016. The government debt will amount to 68.8% of GDP in 2015 (EMU-definition) and 67.8% in 2016 (CPB, March 2015). 90 Government
Competitive taxation climate Corporate tax rate on profit 2014 (%)
12.5
Ireland
20.0
Finland
21.2
Switzerland
22.0
Sweden
23.0
United Kingdom
24.5
Denmark Austria
25.0
Netherlands
25.0 29.2
Luxembourg
30.2
Germany Source: IMD, 2014. 0
10
20
30
40
50
60
70
79
The corporate income tax rate is 20% on the first 200,000 euros and 25% for taxable profits exceeding 200,000 euros which is well below the EU national average. Furthermore, companies can benefit from an effective tax rate of only 5% for R&D income from self-developed, patented, intangible assets and also from self-developed, unpatented, intangible assets which qualify for the WBSO subsidy. Other features of the Dutch tax system include a wide tax treaty network - the participation exemption which states that all benefits related to a qualifying shareholding are exempt from Dutch corporate income tax, and, finally, a 30% tax-break for highly qualified foreign employees. Government 91
Explanatory notes regarding this publication This publication is intended to provide a concise and representative picture of the state of the Dutch economy. Every attempt has been made to carefully and judiciously select indicators from internationally renowned and reliable sources. In the case of most of the indicators, the Dutch economy has been compared with surrounding countries and the United States, many of which are similar in terms of their economic structures. Comparisons have also been made in a number of cases with other countries, such as with various worldwide rankings.
92
Sources Amsterdam Airport Schiphol www.schipholgroup.nl
OECD www.oecd.org
The Conference Board www.conference-board.org
Port of Rotterdam Authority www.portofrotterdam.com
Economist Intelligence Unit www.eiu.com
Social and Cultural Planning Office of the Netherlands www.scp.nl
European Commission www.ec.europa.eu Eurostat www.epp.eurostat.ec.europa.eu IMD www.imd.ch IMF www.imf.org INSEAD www.globalinnovationindex.org Ministry of Foreign Affairs www.government.nl/ministries/bz Netherlands Bureau for Economic Policy Analysis www.cpb.nl The Netherlands Observatory of Science and Technology www.nowt.nl The Netherlands Organisation for Applied Scientific Research www.tno.nl
Statistics Netherlands www.cbs.nl Technisch Weekblad www.technischweekblad.nl Transparency International www.transparency.org UNCTAD www.unctad.org United Nations http://comtrade.un.org/ United Nations Development Programme www.hdr.undp.org World Bank www.worldbank.org World Economic Forum www.weforum.org World Trade Organization www.wto.org
93
Other sources of information More detailed information is available on the websites below, almost all of which include sections in English.
Information regarding innovation Benelux Office for Intellectual Property www.boip.int
Netherlands Patent Office www.agentschapnl.nl/ octrooicentrum
Statistics Netherlands www.cbs.nl
Netherlands Enterprise Agency www.rvo.nl/innovatie
Ministry of Economic Affairs www.government.nl/ministries/ez
Trendwatchers for Innovation and Technology www.rvo.nl/en/nost
Information regarding the labour market and higher education http://www.studyinholland.nl/ Statistics Netherlands www.cbs.nl Netherlands Bureau for Economic Policy Analysis www.cpb.nl
Association of Universities in the Netherlands www.vsnu.nl Netherlands Organization for International Cooperation in Higher Education www.nuffic.nl
Ministry of Social Affairs and Employment www.government.nl/ministries/szw
General information about the Netherlands Ministry of Foreign Affairs www.government.nl/ministries/bz
94
Statistics Netherlands www.cbs.nl
Information regarding enterprise (including internationally), investing and partnerships in the Netherlands Ministry of Economic Affairs www.government.nl/ministries/ez
Ministry of Finance www.government.nl/ministries/fin
Netherlands Foreign Investment Agency www.nfia.nl
Statistics Netherlands www.cbs.nl
Netherlands Enterprise Agency, focus on sustainability, innovation and international www.hollandtradeandinvest.com www.rvo.nl
Chambers of Commerce www.kvk.nl
95
Information regarding Top Sectors Food Tech Holland www.foodtechholland.nl Dutch Federation of Agriculture and Horticulture (LTO) www.lto.nl Association of the Dutch Chemical Industry www.vnci.nl Dutch Design Fashion Architecture Programme (DFA) www.dutchdfa.com Dutch export platform for Dutch clean tech companies www.cleantechholland.nl
96
Energy Research Centre of the Netherlands www.ecn.nl Association of Suppliers of Environmental Technology www.vlm.fme.nl Holland High Tech Sector www.hollandhightech.nl Plantum (Dutch Association for Plant Propagation Material) www.plantum.nl Dutch Flower Auction www.floraholland.com
Greenport Holland (Dutch Horticultural Association) www.greenportholland.com (Dutch only) Life Sciences and Health Sector www.lifescienceshealth.com Holland International Distribution Council www.hidc.nl Port of Rotterdam www.portofrotterdam.com
Dutch Water Sector www.dutchwatersector.com Wetsus, Dutch Centre of Excellence for Sustainable Water Technology www.wetsus.nl Holland Shipbuilding Association www.hme.nl The Association of Dutch Suppliers in the Oil and Gas Industry (IRO) www.iro.nl and www.iro-noc.nl
Amsterdam Airport Schiphol www.schipholgroup.com
97
Imprint 2015 Edition This publication, Holland Compared Cyber Security Special 2015, is published by the Dutch Ministry of Foreign Affairs. For further information please contact the Dutch embassy, consulate or Netherlands Business Support Office in your area, or visit www.hollandtrade.com to learn even more about Dutch commerce. Editor-in-Chief Angelina Helder-Klamer Economic editor Ron Hogenboom Gea Blok (assistant) English language editor Jacqueline Meeuwisse
Editorial address Holland Compared Netherlands Enterprise Agency Intelligence Unit P.O. Box 20105 2500 EC The Hague The Netherlands Design Tigges, Voorburg
Coordination Elles van Egmond
Copyright Articles may be reprinted or reproduced only with acknowledgement of the source: Source: Holland Compared 2015 No rights may be derived from the contents of this publication. Photo front, source: Netherlands Enterprise Agency
98
Source: Heerema Marine Contractors Nederland B.V.
Source: Energising the Future
What companies say about the Netherlands Strategic location “Opening a base at Schiphol is an important strategic move for easyJet. easyJet is already the second largest airline at Amsterdam - one of Europe’s leading airports serving a large and growing aviation market with strong passenger demand both to and from the Dutch capital.” EasyJet (UK) Digital Gateway “Now, this is just the European Headquarters, but it is a matter of time before this office will serve as the headquarters for Africa and the Middle East as well.” Netflix (USA) Superior logistics and technology infrastructure “Aside from the great infrastructure and the Netherlands excellent location in Europe, the Netherlands also appeals to us because of developments in the fields of smart cities, smart environments, and smart mobility.” Huawei (China)
www.hollandtrade.com
