Pandemic would ravage economy: central bank

15 March 2006

AMSTERDAM — The Dutch Central Bank (DNB) has warned a major flu pandemic could lead to a minimum of a 5 percent drop in gross national product in the Netherlands.

The DNB included its analysis of the potential consequences of a major flu outbreak in its quarterly report published on Wednesday. The H5N1 strain of bird flu, which is potentially deadly for humans, has been detected in 11 of the 25 countries of the European Union.

The bird flu has also manifested itself in other countries around the world and several people have died of it. 

As the Netherlands is very dependent on exports, the economy would be particularly vulnerable in a pandemic as other countries might close their borders to Dutch products, the DNB said. The losses to the Dutch economy might also be permanent as the composition of the population is changing, leading to reductions in production.  

The financial sector, which the DNB oversees, would also feel the impact of a pandemic, the report said. Insurance companies would face high claims as a result of deaths and illness. An increase in bankruptcies and a drop in applications for mortgages and credit also posed a threat to the industry, the DNB said.

[Copyright Expatica News + ANP 2006]

Subject: Dutch news