The Netherlands has earned its place as one of Europe’s leading innovation hubs. According to the European Innovation Scoreboard (EIS) 2025, the country ranks 3rd among EU member states and 4th when including neighbouring non-EU countries. This marks a step up from recent years, when the Netherlands held the 4th position, highlighting its rising role as a powerhouse of innovation.

Driving Forces Behind Dutch Innovation

The report attributes the Netherlands’ performance to several key strengths:

• Digitalization – The Netherlands ranks 1st in the EU for digitalization, with 96% of households connected to high-speed broadband and more than half of its citizens possessing advanced digital skills. Dutch companies are also leaders in cloud computing, IT infrastructure, and technology adoption.
• Research & Talent – With one of the world’s most attractive research systems, the Netherlands excels in global scientific collaboration. It ranks among the top for international co-publications and is home to some of the most cited scientific research worldwide.
• Business & Investment Climate – Dutch companies outpace the EU in research and development (R&D) spending, supported by robust government policies and rising venture capital investment. Strong intellectual property protections further reinforce the country’s appeal.

Together, these strengths create an environment that attracts foreign direct investment (FDI), bolstering the Netherlands’ role as a key innovation hub in Europe.

An Advanced Service-Driven Economy

The Dutch economy is among the most prosperous in Europe, with GDP per capita reaching 134% of the EU average. It is service-oriented and heavily knowledge-based, with 39% of employment in knowledge-intensive services, far above the EU average. A strong labour market, with an employment rate of 83.5%, underpins this growth.

Entrepreneurship is also thriving while new business formation is slightly below the EU average, entrepreneurial activity is nearly double the EU benchmark. This vibrant start-up ecosystem is supported by government initiatives, university-linked hubs, and a culture of innovation.

Innovation in Sustainability and Circularity

The Netherlands stands out as a leader in sustainable innovation. It has one of the EU’s highest circular materials use rates—almost three times the European average—and performs strongly in eco-innovation. However, challenges remain, particularly in reducing greenhouse gas emissions from its energy mix.

Government policies, including carbon pricing and sector-specific agreements, are in place to accelerate the transition to a low-carbon economy, although the country is not yet on track to meet its 2030 emissions targets.

Leadership in Agrifood Innovation

A global agrifood powerhouse, the Netherlands is the second-largest exporter of agrifood products and home to world-leading research in agriculture and food technology. Wageningen University consistently ranks as the top agrifood university worldwide, while companies and research institutes drive breakthroughs in precision farming, plant-based proteins, fermentation, and sustainable horticulture.

Dutch agrifood innovation is rooted in collaboration. Initiatives like Foodvalley, the Protein Community, and the Dairy Campus bring together universities, businesses, and government agencies to build a future-proof, circular Agri-economy. The government’s National Protein Strategy aims to establish global leadership in sustainable protein production by 2030.

Pioneering Water Technology

Water management is another area where the Netherlands sets global standards. With a long history of land reclamation and flood defence, the country now leads in climate-resilient water technologies, wastewater treatment, and digital water solutions.

At the heart of this ecosystem is WaterCampus Leeuwarden, Europe’s leading water tech hub, which hosts pioneering research institutions such as Wetsus and collaborative platforms like Water Alliance. Dutch expertise in water technology is exported worldwide, from Dubai’s Palm Jumeirah to the expansion of the Panama Canal.

A Nation Built on Collaboration

Across all sectors, the Netherlands benefits from its triple helix model of innovation—a collaborative framework uniting government, academia, and industry. This approach, combined with strong international openness, has created an ecosystem where innovation thrives.

From digitalization to agrifood and water technology, the Netherlands’ strengths reflect more than just investment—they demonstrate a culture of pragmatism, cooperation, and forward-thinking.

Outlook

With continued investment in technology, sustainability, and entrepreneurship, the Netherlands is well-positioned to remain at the forefront of European and global innovation. Its rise to 3rd place in the European Innovation Scoreboard 2025 confirms its growing role as a leader in solving the world’s most pressing challenges—from food security to climate resilience.

References

Fabrizio Guzzo, Technopolis Group. (2025). European Innovation Scoreboard 2025 – Country profile Netherlands. Brussels: European Commission.

Invest in Holland. (2025). Innovate Water Technology in the Netherlands for Future-Proof Water Management and Resilience. Retrieved from Invest in Holland: https://investinholland.com/doing-business-here/industries/water-technology/

Invest in Holland. (2025, July 22). The Netherlands Ranks as 3rd Most Innovative Country in Europe in 2025. Retrieved from Invest in Holland: https://investinholland.com/news/the-netherlands-ranks-as-3rd-most-innovative-country-in-europe-in-2025/

Invest in Holland. (2025). The Netherlands: circular agri-economy pioneer and powerhouse of food innovation. Retrieved from Invest in Holland: https://investinholland.com/doing-business-here/industries/agrifood/