THE HAGUE—The economy shrunk 0.9 percent in the fourth quarter compared to the previous three months meaning it is now technically in recession, the CBS statistics agency said Friday.

"This is the biggest quarter-on-quarter drop since the beginning of the 1980s," it said in a statement announcing its first estimate for the fourth quarter of 2008.

It also revised figures for the second and third quarters to show contractions.

A recession is defined as two consecutive quarters of contraction.

Third quarter growth was revised downward from zero to minus 0.3 percent, said the agency, and for the second quarter from plus 0.1 percent to minus 0.1 percent.

"According to the definition of recession as two successive quarters with negative growth, the Netherlands is now in recession," it said.

Year-on-year, gross economic product shrunk 0.6 percent in the fourth quarter, the first drop in more than five years.

"This is mainly the result of a strong decline in exports of Dutch products," said the statement.

For the year as a whole, growth was put at two percent.

The CBS said investment in the fourth quarter declined 0.3 percent, exports dropped 1.9 percent, and imports rose by one percent.

The number of new jobs created grew by 0.4 percent from the third to fourth quarters.

"Job creation has shown a delayed reaction to shrinking production," said the CBS.

AFP/Expatica