Kingdom of the Netherlands—The Netherlands: 2025 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for the Kingdom of the Netherlands—The Netherland

The 2025 Article IV Consultation underscores that the Dutch economy, one of the most developed globally, has drawn significant strength from its integration into global value chains. Despite weathering past shocks effectively, its resilience is now being tested by a combination of trade tensions and domestic policy uncertainty. In order to navigate these challenges, fiscal policy should shift from stimulating demand to expanding supply, focusing on investments in infrastructure, education, and research and development. Additionally, fostering investment to increase the housing supply and implementing growth-enhancing tax reforms are crucial. Financial oversight must adapt to the evolving global environment and financial landscape, especially as increased market volatility due to trade tensions and uncertainty poses significant liquidity risks to non-bank financial institutions. Domestic demand is expected to drive growth, supported by strong household purchasing power, although trade tensions will likely dampen external demand, investment, and confidence. Reforms should target key growth bottlenecks, such as nitrogen and electricity grid congestion, while also increasing labor input and firm productivity, expanding financing for small and medium enterprises, and effectively managing the green and demographic transitions.