as Max Pam of Dutch TV program 'Buitenhof' asks in his column when the Dutch and the German economy have split, and what are the causes for this to happen here are some answers:
First it has to be confirmed that the statements in Max Pam's column where German and Dutch economies once acted like 'northern European twins' are true.
The one interconnected to the other, not only by their central banks with almost identical emphasis on prize stability, but also by their bilateral trade links, and even by some almost identical parts of infrastructure, like the havens of Rotterdam and Hamburg are for both export oriented countries their gate to the world market.
So some commentators on Twitter argued on their assumption that lack of consumer confidence is the only reason for sluggish consumer spending. One has to know that Dutch people are being subjected to bad economic news concerning housing market, pension cuts and other bad stuff almost on a daily basis, where some economists even started to warn of an negative effect of repeating bad news into a self fulfilling prophecy.
So people tend to think the split between currently successful German economy and Dutch economy is because of difference in consumer spending based on lack of 'consumer confidence'. Well, partially yes, but the German retail sector has also its difficulties (Big supermarket chain 'Schlecker' went bust recently), the 2nd and more important fact is, that both economies are heavily export oriented. Although Mathijs Bouman (Dutch economist) recently put up some evidence that 70% figures (Link) for Dutch export part of GDP is largely exaggerated.(CBS data)
So one part of the answer is that Germany put much more effort into investment (the mother of all growth) in its 'green sector' by not only building huge production capacity for its domestic ecopower section but also pumped large chunks of cash into energy preservation by housing insulation etc.
The roughly estimated cost for the buildup of its solar power capacity of some 25 GW was good for some 75bn € only for the 1+ million installed smaller plants between 2000-2011.
Additional investments in local and national grid summed up also to Billions while the combined installed wind power capacity reached some 23 GW with approx 46 Bn € (taking into account average price per KW peak capacity) (** find and insert exact numbers**)
The Netherlands <> Germany bilateral trade
CBS: Exports to Germany increased by 20% in 2010 (CBS data) (dut)
Dutch im/exports targeted on a limited number of countries (CBS data)(dut)
Pinokkio:"Our GDP rose after introduction of Euro" (De Pers) (dut)
"In The Hague there is always today, never tomorrow" (FD) (dut)
source: thomsonreuters.com datastream
Some German economic data:
Some German economic data:
Germany's economy (Wiki ger)
Trade:
BDI Foreign trade growth 2012: "3 pct +X" (focus) (ger)
German exports to Greece tumble (handelsblatt) (ger)
Trade balance: German exports first time above 1000 bn (Die Zeit) (ger)
German industry expects export boom (Die Welt) (ger)
Energy:
German green industry domestic investments and distributed costs:
(long term projection) Langfristszenarien EEG Auswirkungen (pdf ger)
German power production details and comparison (Wiki ger)
German energy consumption (Wiki ger)
German energy consumption in detail 2011 (AG Energiebilanzen , pdf, ger)
investment projection renewables Germany 2010-2020: 159,5 bn € (prognos,pdf,ger)
Power grid in the North Sea to be extended (FAZ, ger)
Duitsland verslaat Nederland (May 2nd 2013, video, Nieuwsuur, Dutch)
Text above excerpted from greater European solution: Economic policy first, fiscal policy follows
