Dutch government shocked by economic forecast

17th February 2009, Comments 0 comments

Political parties call for immediate reaction to stimulate the economy as a recently released forecast predicts output to shrink by 3.5 percent in 2009.

THE HAGUE – A new forecast for the Dutch economy in 2009 released by Netherlands Bureau for Economic Policy Analysis, CPB, has sent shockwaves through parliament and caused Prime Minister Jan Peter Balkenende to declare the country is facing an ‘extremely serious’ economic situation.

New figures released on Tuesday predicted output to shrink by 3.5 percent in 2009, leaving 120,000 more people jobless as exports dwindle.

The organisation also said the Dutch economy is set to shrink 3.5 percent this year due to the greater-than-expected impact of the international economic crisis.

Mixed reactions from different political parties
The Christian Democrats wants the cabinet to implement measures to stimulate the economy in the short and the long term.

The Christian Democrats' coalition partner, the Labour Party, identified the rising unemployment rate as the main point of concern and urged for urgent action.

The junior party in the government coalition, the Christian Union, referred to the present crisis as a "critical phase".

The leader of the opposition Socialist Party, Agnes Kant, wants immediate action from the cabinet. She said the measures needed to stimulate the economy are coming too late. Kant is against introducing cutbacks in healthcare or unemployment benefits.

Green Left said creating and sustaining work opportunities is more important in the broader context of the economic slowdown than strict management of the state treasury.

Conservative VVD leader Mark Rutte said it's time for the government to stop "bickering". He urges the government to raise the retirement age gradually to 67.

Prime Minister Jan Peter Balkenende said the unemployment figures are the most painful element in the projections and that it would be an "illusion for people to think that the government will single-handedly solve all of their problems".

[Radio Netherlands / Expatica]

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