AGRICULTURE

In 1998, agriculture accounted for 3.5 percent of the kingdom's GDP. Employment in agriculture has actually been increasing slightly over the past decade. In 1995, there were 109,000 people employed in the sector, but by 1999 that number had grown to 116,000. Much of this increase has been the result of growth in the dairy and horticulture segments of agriculture. As in many other countries, Dutch agriculture has been marked by the decline of the small, family-owned farm and the rise of large corporations that specialize in agriculture. Many Dutch agricultural firms have also become increasingly international and do a significant amount of their business overseas or in other European nations. Dutch agriculture is divided into 3 broad areas: crop production, dairy and livestock production, and horticulture. The nation's agricultural land is also divided into 3 broad types: grasslands, farmlands, and horticultural lands. The nation's extensive waterways and network of dams and dikes allow for easy irrigation and have produced very fertile soils. On the other hand, the increased use of chemicals in agriculture has created environmental pressures and led to new ecological policies that are designed to reduce damage to the kingdom's environment. Partially because of pollution concerns and partially because of health considerations, the consumption of organic foods (crops and livestock that are raised without chemical fertilizers or pesticides) has increased. While these foods now account for 2 percent of total production, by 2010 they are expected to comprise 5-10 percent of total production. The main food crops are barley, corn, potatoes, sugar beets, and wheat. Potatoes are the main crop by volume, and in 1999 Dutch farmers produced 8.2 million metric tons of the crop. That same year, the Dutch harvested 5.5 million metric tons of sugar beets, 1 million metric tons of wheat, 240,000

metric tons of barley, and 58,000 metric tons of corn. Despite its wheat and barley production, the nation is a major importer of wheat for animal fodder and cereal production. After suffering a significant drop in production in 1998 because of flooding and bad weather, agricultural harvests were up 23.9 percent in 1999. In 1998, the value of exports was US$18.7 billion, while in 1999 it was US$31.7 billion. The major agricultural processed product was cigarettes. The Netherlands is one of the least forested countries in the world. Over 90 percent of its forest products have to be imported. Dairy and livestock production is highly specialized and technologically sophisticated. Extensive grasslands provide grazing for dairy cows and beef. Dutch farmers have some of the highest yields of beef and milk in the world (behind only the United States and Great Britain). The nation is self-sufficient in dairy production and most dairy goods are exported. The main dairy exports include butter, cheese, and condensed milk. The number of dairy cows has remained relatively constant in the kingdom. In 1994, there were 1.69 million dairy cows and in 1998 there were 1.61 million. In 1997, the nation produced 11 billion kiloliters of milk, about half of which was used to produce cheese. Many of the small, independent Dutch dairy farms have been bought by large corporations. One of the largest dairy corporations in the Netherlands is Campina Melkunie. In 1999 this large, multinational company did only 36 percent of its US$5 billion business in the Netherlands, with the rest centered in various EU nations. The Dutch food and beverage company Unilever is one of the world's largest corporations. The Dutch also have a large brewing industry. Firms such as Heineken and Grolsch export beer around the world and have operations in 170 nations.

Besides dairy cows, the other main types of livestock are beef and veal, chicken, duck, lamb, pork, and turkey. Eggs and beef are the main livestock exports. Total livestock numbers have declined slightly over the past few years. For instance, in 1994 there were 7.7 million head of cattle, but by 1998 that number had declined to 4.3 million. Likewise, there has been a similar decline in the number of pigs. In 1994 there were 14.56 million pigs; however, by 1998 that number had fallen to 13.45 million. Seafood consumption has risen substantially in the Netherlands over the past 2 decades. Dutch fishermen harvest some 407,000 metric tons of seafood each year. About half of this is consumed locally and the rest exported. The Dutch also import significant amounts of seafood, including squid, prawns, shrimp, and crab. Horticulture, especially the growing of ornamental plants and flowers, is a major factor in Dutch agriculture. The Dutch export significant amounts of cut flowers and bulbs, and the nation is world-renowned for its tulips. About 75 percent of flowers are exported, and there has been dramatic growth in exports to the United Kingdom, Italy, and Russia. This amounts to some 9 billion flowers per year. Horticulture is conducted in both open fields and through the use of glass greenhouses. The Netherlands now contains over half of all of the greenhouses in Europe, and there is a total of 44,000 acres of flowers under cultivation. Over 3,000 companies are engaged in horticulture in the kingdom. Review: Netherlands has a long tradition of farming and market gardening, and specializes in the production of high-quality food and drink. It markets a wide range of farm produce, including organically-grown fruit and vegetables. Although by global standards Netherlands has relatively little farmland, it is

the worlds third biggest exporter of agricultural produce. Dairy farming and horticulture are the main activities. Some 3% of the Dutch workforce is employed in the agriculture sector, which is responsible for approximately 2.2% of the Gross National Product. Productivity has increased enormously in the past decades, thanks to high quality education and research, and information that targets framing practice.

INDUSTRIAL OUTPUT
Industrial Production in Netherlands expanded 1.26 percent in October of 2011. Industrial production measures changes in output for the industrial sector of the economy which includes manufacturing, mining, and utilities. Industrial Production is an important indicator for economic forecasting and is often used to measure inflation pressures as high levels of industrial production can lead to sudden changes in prices. From 1996 until 2010, Netherlands' industrial production averaged 1.22 percent reaching an historical high of 11.20 percent in December of 1999 and a record low of -13.50 percent in February of 2009. This page includes: Netherlands Industrial Production chart, historical data and news. Although it has declined as a percentage of the nation's GDP, industry remains a viable component of the Dutch economy, contributing 26.8 percent to GDP in 1998. Dutch industry is diversified and includes a variety of businesses that range from manufacturing, mining, and energy production to construction and chemical manufacturing. The government has undertaken a variety of programs to encourage the development of new industries in the kingdom and to bring industry to areas of the country that are economically depressed.

Specifically, the government has encouraged growth in the aerospace industry, biotechnology, and microelectronics.

MANUFACTURING AND CONSTRUCTION.

The Dutch manufacturing sector is dominated by the production of chemicals and pharmaceuticals, metals and electronics, food processing, and tobacco. Over the past decade, the chemical industry has declined slightly (by 2 percent), while metals and electronics and food processing has expanded by 810 percent. In 1999, total manufacturing in the kingdom grew by 9 percent. In 1998, there were 847,591 people employed in manufacturing. The largest number, 144,645, were employed in food and tobacco processing. The number-two industry in terms of employment was metal processing with 99,753 workers, and the number-three field was machinery manufacturing with 89,688 employees. Electronics manufacturing in the Netherlands is dominated by

the multinational corporation Philips. The company makes lighting, consumer electronics, appliances, semiconductors, and communications systems. Philips is the ninth-largest manufacturer of semiconductors in the world. Of the 100,000 people employed in the Netherlands in the electronics field, Philips employs 44,000. Worldwide, Philips employs 265,000 people. Other major Dutch electronics firms include ASML, CMG, and Origin. The largest computer chip factory in Europe is in the Netherlands. The most dramatic declines in employment and output were in the textile manufacturing sector and in shipbuilding and repair. Many of the manufacturing industries are based on the processing of raw materials or semi-finished materials into finished products. In other words, companies in the Netherlands import materials such as metal or chemicals and turn these

items into products that consumers can use such as car parts or cleaning chemicals. The Dutch chemical industry produces a variety of goods including synthetic rubber, plastic consumer goods , and polyester yarns for industrial purposes. Major Dutch chemical companies include Shell, Akzo Nobel, and DSM. Shell and Akzo Nobel are the eleventh-and twelfth-largest chemical companies in the world. DSM produces 70 percent of the polymers and rubber that the European automobile industry uses to produce new cars. Meanwhile, Dutch pharmaceutical companies have an annual output of about US$4 billion. Ship building and repair continue to be significant factors in the Dutch economy. However, competition from countries where workers are paid less has caused drastic cutbacks in the field which is only about one-half the size it was previously. Still, the Netherlands is the world's seventh-largest producer of ships and the fourth-largest in Europe. Ship building and repair employ about 10,000 workers and are concentrated in the large ports on the western coast. The industry had revenues of US$1.66 billion in 2000, most of which were from ship building. In 2000, Dutch ship builders received orders for 88 new vessels and 45 percent of these orders were from foreign firms. Over the past 30 years, construction has had a major impact on the Dutch economy. Because the nation is so small in geographic size and has a high population density, real estate is very valuable in the kingdom. On several occasions this has led to a bubble (a rapid increase in value that is unsustainable over many years) in the housing market. The collapse (or bursting) of the housing bubble in the 1970s led to a widespread economic recession . During this recession, real estate prices declined by 45 percent by 1982. Nonetheless, the construction field is aided by government

spending on infrastructure projects. In 1999, there were 31,459 construction companies and 416,000 people employed in the field. During the 1990s, the sector averaged 2 percent growth per year.

MINING AND MINERAL EXTRACTION.

Although there was once a vibrant coal mining industry in the Netherlands, the discovery of oil and natural gas led to the demise of the coal companies during the 1970s. By the 1990s, the only mining operations left in the kingdom were small companies that extracted salt, peat, and some sand and gravel for construction uses. In 1998, there were only about 9,000 people employed in mining. All metal ore used in manufacturing or other industries has to be imported. The Dutch do produce a limited amount of oil. However, oil production peaked in 1986 at 66,500 barrels of oil per day. Since that time, production has declined to an average of about 60,000 barrels per day. Many of the kingdom's former oilfields in the North Sea are now in the process of being decommissioned. Energy production employed about 6,670 people in 1998, but produced considerable profits for the nation. On the other hand, the kingdom is Western Europe's number-one supplier of natural gas. In 1958, the Geneva Convention on the Law of the Sea gave the kingdom the rights to a 56,980 square kilometer (22,000 square mile) area in the North Sea. This region contains the kingdom's main reserves of natural gas and is actually larger than the country itself. The main company in the sector is the Netherlands Natural Gas Company which is owned by Dutch and American energy firms and by the Dutch government. About half the natural gas produced is used within the country, with the rest exported to EU nations. The main export destinations are Germany, Belgium, France, Switzerland, and Italy. In 1999, the total natural gas production of the kingdom was 80 billion

cubic meters. The proven reserves of natural gas exceed 2 trillion cubic meters. Government revenues from natural gas were US$1.2 billion in 2000.

Role of state
The government of the Netherlands is a constitutional monarchy. The head of state is the monarch, presently Queen Beatrix, but the sovereign's powers are now mainly ceremonial. The chief of the government is the prime minister who is appointed by the queen. The prime minister is usually the leader of the majority party in the nation's parliament or the leader of the largest coalition of parties. The country also has an advisory committee, known as the Council of State, which develops and coordinates policy. Members of the council are appointed by the queen on the advice of the prime minister. The legislative branch, or parliament, of the nation is known as the States General. The States General is a bicameral (2 chamber) legislative body. The 2 houses are called the First Chamber and the Second Chamber. The Second Chamber is the more influential of the 2 bodies. It initiates legislation and may amend bills that are developed by the Council of Ministers. The chamber has 150 members who are elected for 4-year terms by the general population. Unlike the American system, representatives are not elected to represent individual districts but the nation as a whole. During elections, the people do not vote for individual candidates but for a particular party. The election results are proportional so that a party that received 60 percent of the votes would have 60 percent of the seats in the Second Chamber. There are 75

members of the First Chamber. These representatives are elected by the legislatures of the nation's 12 regional governments, known as provinces. Because of the proportional system of elections, even small parties are often able to have representation in the States General. Hence, unlike the United States, the government of the Netherlands is usually made up of a coalition of a number of small parties, and politics is not dominated by 2 major political parties. Since 1998, the government has been led by the "Purple Coalition" which is made up of 3 parties: Labor, Liberal, and Democrats '66. All of these parties support free enterprise capitalism , but the Labor Party and Democrats '66 tend to be more supportive of government efforts to establish social and economic equality by redistributing wealth through taxes on the wealthy and middle-class. The Liberal Party stresses individual political and economic freedom and is much more conservative on economic issues than its 2 coalition partners. The main party that opposes the coalition is the Christian Democratic Appeal or Christian Democrats. This party was initially formed from the merger of 3 religious parties and is generally one of the more conservative Dutch political groups. The party opposes most government involvement in the economy. The last major party is the Green Party which is pro-environment and advocates strict restrictions on pollution and economic activity which might harm the environment. The government of the Netherlands does not play a major role in the nation's economy. It does not own a large number of businesses or attempt to control economic ventures. Furthermore, since the 1980s, there has been an ongoing program to turn those few government-controlled companies and businesses over to the private sector . An example of this would be increasing private control over telecommunications and public transport services. Public spending, including infrastructure projects, social spending, education, and health care amounted to 46 percent of the nation's GDP in 2000 and is

expected to decline over the next decade. In 2000, the government announced tax reductions, including a cut in the direct taxes paid by most Dutch citizens. The impact of the government is most significant on 3 different levels. First, there are numerous regulations and restrictions on economic activity which include the need to obtain permits for certain types of businesses and controls on product safety and advertising. Second, the government takes an active approach to managing the nation's credit supply and the value of its currency. Since the 1980s, the government has consistently pursued policies to keep inflation low. The government has also allowed the value of the currency to decline in an effort to make Dutch products less expensive and therefore more competitive in global markets. Third, and finally, the government takes an active role in managing the nation's environment. The centerpiece of Dutch environmental policy is the National Environmental Policy Plan known as the NMP. This plan seeks to cut pollution by 80 percent by 2010. Much of the nation is under sea level, and therefore prone to flooding, so the government also plays a major role in land management, including determining what types of structures can be built on different terrain. In 1999, the government had revenues of US$163 billion and expenditures of US$170 billion, but in 2000 the government had a small surplus which equaled 0.5 percent of GDP. The government debt amounts to 63.7 percent of GDP. This is higher than the EU average of 60 percent of GDP, but the debt has declined from 67 percent of GDP in 1998. One of the economic and foreign policy objectives of the Netherlands has been European economic and political integration. In the aftermath of World War II, the Dutch formed the Benelux Customs Union with Belgium and Luxembourg. This organization reduced tariffs between the 3 nations and set

the stage for the later formation of the European Community, which itself later led to the establishment of the EU. The nation also helped develop the plans for EMU, which strives to fully integrate the economies of the EU, including replacing national currencies with the euro. Because of their experiences during World War II (when they were conquered by the Germans), the Dutch have supported political cooperation as a way to prevent new conflicts in Europe. Since the Netherlands is a small country, its government has found that the best way to achieve its foreign and economic policy goals is by cooperating with other nations in international organizations such as NATO, the EU, and the UN.