If the Dutch government’s vaccination strategy goes according to plan and the coronavirus lockdown relaxes, the Dutch economy will grow by 2.1 percent this year and be back to pre-pandemic levels by the end of 2021, Rabobank said in its newest economic outlook. Consumers and businesses are expected to spend more, though rising unemployment will dampen the effect somewhat, NU.nl reports.
“Much depends on the rate of vaccination and relaxation,” chief economist Ester Barendregt said. “For this estimate we assumed that more may gradually be allowed from the second quarter, such as a limited reopening of non-essential shops and catering establishments. Based on the government’s vaccination strategy, we assume that at the beginning of the fourth quarter almost everyone who wants to have been vaccinated and all coronavirus measures in the Netherlands can be abandoned.”
Rabobank is convinced that once more is possible, Dutch households will spend more. “This was also clearly visible in the summer of 2020. The fact that households saved a lot last year can also temporarily give their spending an extra boost.” Although rising unemployment will brake that increased spending somewhat. The bank expects that unemployment will increase from 3.6 percent in January to 4.7 percent at the end of the year.
Companies will also spend more, with Dutch exports benefiting from the improving world economy. And government spending will also increase, “partly because of catching up on deferred care and through spending on corona test sites, vaccines and vaccinations.”