Today’s article aims to offer insights into possible consequences on the NL-USA bilateral relations, trade and even economical aspects.
Donald Trump’s re-election as President of the United States has raised significant questions about how his policies will influence global economies, including that of the Netherlands. With proposed import tariffs, potential trade disputes, and shifts in energy policies, the impact on Dutch trade and industry could be substantial.
Trump’s Economic Policies and the Netherlands
In his campaign, Trump emphasized protecting American businesses by proposing higher tariffs on imported goods, potentially ranging from 5% to 20%. Dutch banks and economists warn that such measures could harm the Dutch economy, which heavily relies on exports to the U.S. Key sectors, including chemicals, pharmaceuticals, vehicle parts, machinery, and transportation, would face immediate challenges.
According to Rabobank, a 10% universal tariff could shrink the Dutch economy by 0.9%, translating to a €500 annual cost per citizen. Dutch exports to the U.S. totalled €33.8 billion in 2023, but this strong trade relationship also includes significant imports like crude oil and natural gas, making the Netherlands particularly vulnerable to U.S. policy shifts.
Potential Consequences for Dutch Trade
The ripple effects of Trump’s trade policies could lead to a chain reaction. If a trade war erupts between the U.S. and the European Union, higher tariffs could make American products more expensive in Europe, exacerbating inflation in the Netherlands, which Rabobank predicts could rise from 3.6% to 3.8%.
Dutch businesses, already grappling with uncertainty, are bracing for potential disruptions. For example, Scelta Mushrooms, a mushroom processing company in Venlo, has seen American clients delay investments. Similarly, companies like Tata Steel Netherlands are adopting a wait-and-see approach while preparing for possible fallout.
Energy Sector Concerns
Energy giant Shell is also closely monitoring developments. CEO Wael Sawan recently highlighted the critical role of U.S. policies in global energy markets, particularly in advancing clean energy technologies like hydrogen and maintaining liquefied natural gas (LNG) supplies. Sawan emphasized that stability in U.S. policies is essential for fostering innovation and securing energy investments, warning that changes under Trump’s administration could disrupt progress.
Mixed Reactions from Dutch Politicians
The Dutch political response to Trump’s victory has been a blend of cautious optimism and outright criticism. Prime Minister Dick Schoof expressed hope for continued collaboration, underscoring the importance of the U.S. as a bilateral and NATO ally. Former Prime Minister Mark Rutte, now NATO’s Secretary General, echoed these sentiments, focusing on advancing peace through strength.
What Lies Ahead
While Trump’s presidency introduces uncertainty, some Dutch business leaders see potential upsides. For instance, Marco Groot of FleuraMetz FM Group believes lower taxes under Trump’s administration could benefit Dutch companies by offering financial flexibility.
The full extent of Trump’s influence on the Netherlands will depend on the implementation of his policies and the EU’s response. For now, Dutch companies and policymakers are preparing for an era of economic and political shifts that could redefine transatlantic relations.
References
Jacobs, S. (2024, November 07). What Trump’s election win will mean for people living in the Netherlands. Retrieved from IamExpat: https://www.iamexpat.nl/expat-info/dutch-expat-news/what-trumps-election-win-will-mean-people-living-netherlands
NL Times . (2024, November 04). Dutch companies brace for U.S. election’s potential impact on trade. Retrieved from NL Times: https://nltimes.nl/2024/11/04/dutch-companies-brace-us-elections-potential-impact-trade
Photo:
https://aexus.com/wp-content/uploads/2022/07/Doing-business-Europe-vs.-USA-Aexus.png
