Download Economic growth 0.8 percent in first quarter

Statistics Netherlands
Press release
PB04-073
13 May 2004
9:30 AM
Economic growth 0.8 percent in first quarter
According to preliminary estimates by Statistics Netherlands quarterly national
accounts, the Dutch economy grew by 0.8 percent in the first quarter of 2004.
This is the first time since the end of 2002 that the volume of gross domestic
product (GDP) was higher than twelve months previously. Employment
decreased further in the first quarter of 2004.
The slight growth in GDP was mainly based on an increase in exports and
fixed capital formation. Government consumption was only slightly higher than
one year previously. Households spent less. The fall in consumption was
smaller than in preceding quarters, however.
Quarter on-quarter growth positive again
Because this year is a leap year, the first quarter of 2004 had one working day
more than 2003. After adjustments for working day and other seasonal effects,
the volume of GDP was 0.4 percent higher than in the last quarter of 2003.
this is the second quarter in a row that the economy has grown. The slight
growth follows a period of stabilisation in the third quarter of 2003 and three
successive quarters of negative economic growth.
Moderate growth for imports and exports
The volume of exports of goods and services was 1.4 percent higher in the
first quarter of 2004 than in the same quarter last year. The volume of imports
was 0.8 percent higher. This continues the slight recovery that started at the
end of 2003. In the two quarters before that imports and exports decreased.
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Investment up again after nearly three years
In the first quarter of 2004 the volume of fixed capital formation was 3.7
percent higher than twelve months previously. This is the first increase in
investment since the first quarter of 2001. The growth was partly caused by
the larger number of aircraft delivered to Dutch companies. Furthermore the
favourable weather pushed up investment in construction. Considerably more
was invested in computers, although less as spent on machinery and
equipment.
Drop in government consumption
The growth in the volume of government consumption was only 0.2 percent on
the same quarter one year previously. This is considerably less than the
growth rates of 2.7 percent or more in recent years. A small part of the
Statistics Netherlands Press release PB04-073
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decrease was caused by the fact that funding of part of health care has been
shifted from government to private households. Without this shift the growth in
government consumption would have been 0.8 percent. Apart from this shift,
the increase in spending on care has also fallen significantly. The increase in
spending on public administration and education was smaller than in 2003.
Household spending down
Households spent 0.3 percent less in the first quarter of 2004 than in the same
quarter last year. This fall is smaller than the previous three months. The
volume of consumption of services rose slightly in the first quarter, partly
because of the higher contribution households made to medical care costs. In
2003 the consumption of services fell slightly. Spending on goods was lower.
The largest decrease was for spending on durable consumer goods,
especially furniture and other home decoration articles.
Slight recovery for private sector production
Production in most commercial branches of industry was higher in the first
quarter of 2004 than one year previously. In manufacturing, construction and
agriculture production was positive again after two years of decrease. Trade
and transport also showed a slight recovery. Within manufacturing, growth
was still largest in the chemical industry, while production by the metal
industry rose again for the time in two and a half years.
Across the board, production was positively affected by the extra working day
and in the construction sector good weather helped push up production.
In the first quarter of 2004 production by the care sector and the government
together was 1.0 percent higher than twelve months previously. This increase
was clearly smaller than in 2003.
Employment down further in spite of rise in production
Employment of employees in terms of working years was 1.6 percent lower
than in the first quarter of 2003. This decrease was larger than in recent years.
Labour productivity, the volume of GDP per working year, was more than 2
percent higher in the first quarter than twelve months previously. This is a
considerably larger increase than that of the last three years. It is not unusual
for labour productivity to rise strongly when the economy seems to be picking
up. The labour market usually reacts to turning points in the economy with a
delay.
Statistics Netherlands Press release PB04-073
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