THE NETHERLANDS

Kingdom of the Netherlands

Koninkrijk der Nederlanden

COUNTRY OVERVIEW

LOCATION AND SIZE.

Once known as Holland, the Netherlands is located in Western Europe. It borders Belgium to the south, Germany to the east and north, and the North Sea along its western coast. The country has a total area of 41,526 square kilometers (16,485 square miles). This includes 33,889 square kilometers of land (13,084 square miles) and 7,643 square kilometers (2,950 square miles) of water. The coastline of the Netherlands is 451 kilometers (280 miles) long. Its land borders are 1,027 kilometers (638 miles) in length. The border with Germany is 577 kilometers (358 miles) long and that with Belgium is 450 kilometers (280 miles) long. The country is about the size of Maryland. The Netherlands is located at the crossroads of 3 of Europe's major rivers: the Rhine, the Meuse and the Schelde. The nation's 2 largest cities are Amsterdam, with a population of 1.1 million, and Rotterdam, also with 1.1 million people. Other major cities include The Hague (700,000 people) and Utrecht (554,000 people). Both the capital and the seat of government are located in the west-central region of the country, near the coast. The Netherlands still has 2 colonies, Aruba and the Netherlands Antilles (both are located in the Caribbean).

POPULATION.

The population of the Netherlands was estimated to be 15,892,237 in July of 2000. In 2000, the nation's population growth rate was 0.57 percent. The birth rate was 12.12 births per 1,000 people. The fertility rate was 1.64 children born per woman, which is below the replacement level (this term refers to the number of children a couple must have to replace both parents, which is roughly 2 children). However, a large number of immigrants move to the Netherlands each year. Annually, there is an average of 2.3 new immigrants in the country for every 1,000 citizens. The mortality rate is 8.72 deaths per 1,000 people. The infant mortality rate is 4.42 deaths per 1,000 live births. Like many of the advanced industrialized nations, the population of the Netherlands is aging. The fastest growing segment of the population is the elderly. Those over the age of 65 make up 14 percent of the population, and this group is expected to double in size over the next 20 years. The average life expectancy for males in the Netherlands is 75.4 years and 81.28 years for females.

The majority of the people of the Netherlands are of Dutch ancestry (91 percent). The Dutch are primarily of Germanic and Gallo-Celtic origins. The remaining 9 percent of the population is split between people of Moroccan, Turkish, and Surinamese backgrounds. The society of the Netherlands is open, but in recent years there has been increasing anti-immigrant sentiment among some groups. During the 1990s, a number of new laws were passed which restricted immigration . The year 1998 was a peak time for political asylum seekers; some 45,217 political refugees settled in the Netherlands. Unemployment is higher among minority groups and some discrimination exists in regard to housing, hiring, and wages. Incidents of police brutality in the 2 Dutch Caribbean colonies have led the national government to undertake a variety of reforms in the territories, including retraining of police and reforms of the prison systems.

Dutch is the official language of the nation, but English is also widely spoken. The population is highly educated and skilled. There is mandatory education through age 16 and the literacy rate is near 100 percent. The Netherlands has a relatively low rate of religious affiliation. Roman Catholics make up 34 percent of the people, Protestants 25 percent, and Muslims 3 percent. About 36 percent of the Dutch are unaffiliated with any formal religion.

The majority of people live in urban areas and the country is one of the most densely populated in the world. Its average population density is 369 per square kilometer (958 people per square mile). In comparison, the population density of Japan is 320 per square kilometer (830 per square mile), while that of the United States is 27 per square kilometer (70 per square mile). The most densely populated area of the country is known as the Randstad and includes the coastal regions of Amsterdam, Rotterdam, and Utrecht.

OVERVIEW OF ECONOMY

The Dutch have a long history as merchants and traders. From the 1600s through the 1700s, Dutch ships carried spices and other raw materials from India, Asia, and the West Indies to Europe and then carried manufactured products back to these areas. Dutch merchants were responsible for opening seaborne trade with China and Japan. Their success was based on the design of their ships which had large cargo holds and small crews. This reduced the costs of transporting goods. It was not until the late 1700s that the British displaced the Dutch as the world's main trading nation. Today that tradition continues as the nation remains dependent on foreign trade.

The Dutch economy is a private free-market system . The main impact of the government on the economy is through regulation and taxation. The Dutch have long been renowned as merchants and almost two-thirds of the economy is now based on foreign trade. Along with the United States, the country has consistently been one of the main proponents of international free trade and the reduction of duties and tariffs on goods and services. A member of the European Union (EU), the nation is set to replace its currency with the euro, a common currency that will be used by 11 of the 15 members of the EU. This process, known as European Monetary Union (EMU), is expected to expand the already large volume of trade between the EU member states and link the economies of these nations to a degree never seen before. The Dutch have been among the strongest supporters of EMU. The Netherlands is home to some of the world's largest corporations, including Royal Dutch Shell and Unilever. Despite its small size, the Netherlands ranks number-seven in the world in total value of its corporations.

The nation is in the midst of a long-term economic expansion that began in the 1990s. The Dutch economy grew at an average rate of 2.8 percent during the 1990s, while the rest of Europe averaged only 1.6 percent growth rates. In 2000, the kingdom's gross domestic product (GDP) per capita was US$25,695. The Netherlands ranks number 20 out of 191 nations in GDP and number 16 in GDP per capita . The Dutch workforce contains about 7 million people. The current economic expansion is based on increased foreign trade, consumer spending, and investment. By 2000, unemployment in the Netherlands was the lowest since the 1970s, and the nation's economy averaged over 4 percent growth per year. The economic growth of the past decade raised the GDP from US$299.4 billion in 1995 to US$365 billion in 1999. The success of the economy is the result of adjustments and transformations that Dutch businesses underwent in the late 1970s through the 1980s. The government cut its role in the economy by privatizing many public corporations, and a substantial number of Dutch companies began incorporating advanced technology and communications into their business practices. In doing so, the Dutch reformed their economy before most of their European neighbors and became far more competitive than those countries. The low level of unemployment and the rising economy have spurred inflation . In 2000, the kingdom's inflation rate was 2.6 percent and that figure is predicted to rise to 3.4 percent in 2001 (this is compared with the EU average rate of 1.6 percent).

Like many of the other industrialized European nations, the Dutch economy has been marked by the growth of the service sector and the relative decline of agriculture and industry as percentages of GDP. Despite the lessening importance of agriculture, the sector continues to be highly profitable. The modern Dutch agricultural industry is highly technological and sophisticated. Although it only employs about 4 percent of the workforce, agriculture produces enough food to feed the nation and provide a significant number of exports. The Netherlands is the world's number-three producer of agricultural goods.

Although industry has declined as a proportion of the overall economy, it remains a major factor in the Dutch economy. For centuries, the Dutch economy was based on maritime trade; however, shipping and fishing are now only minor components of trade. The main industries include chemical and metal processing. The nation is also one of the world's main producers of natural gas. The rise in global energy prices has produced high profits for Dutch energy companies. The energy company Royal Dutch Shell is the fifth-largest corporation in the world, worth US$191.3 billion in 1998, with operations throughout the globe. Other areas of industry include mining, food processing, and construction. The geographic location of the country, at the crossroads of Northern Europe, has allowed it to emerge as a major port of entry into the continent for goods and services. Many goods are shipped first to the Netherlands and then transported by land, air, or sea to other nations in Europe. Two of its ports, Rotterdam and Amsterdam, are among the busiest in the world.

Services dominate the economy and 73 percent of employees work in this sector. The primary services are transportation, the distribution of goods, and business services. There is also a strong financial sector that includes banking and insurance. The Dutch are major investors in foreign countries and foreign businesses (investment abroad is 3 times the level of foreign investment in the Netherlands). The Dutch have US$160 billion invested in other countries.

POLITICS, GOVERNMENT, AND TAXATION

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.

Each year the Dutch spend about US$6.9 billion on defense. The kingdom is a member of the North Atlantic Treaty Organization (NATO—a military alliance of several European nations plus the United States and Canada) and a staunch U.S. ally. For instance, Dutch military forces fought alongside American troops in both the Persian Gulf War and the military operations in Bosnia and Kosovo. The Dutch are among the world's leading providers of foreign aid. In 1999, they gave US$3.4 billion in aid, or about 1 percent of the nation's GDP. They have provided aid for victims of hurricanes in Central and South America and for refugees in places such as Africa, Bosnia, and East Timor. The Dutch are also supportive of international environmental programs.

INFRASTRUCTURE, POWER, AND COMMUNICATIONS

The Netherlands has an excellent infrastructure of ports, airports, and roadways. It also has a highly developed telecommunications system. Since the Netherlands is one of the main points of entry for goods imported into Europe, it is very important for the nation to maintain its transport system in order to move products into the interior of the continent. In order to improve the infrastructure, the government plans to launch a range of new projects over the next decade. A minimum of US$35 billion has already been budgeted to pay for a variety of projects including a high-speed rail link between Amsterdam and Brussels. There are also plans for a special rail system to connect Rotterdam and areas of Germany. Work is ongoing to improve the existing highway and rail network, and, by 2010, the government expects to spend an additional US$5.5 billion on these projects. Among these funds are US$2.4 billion to expand highways and US$500 million for improvements of regional roadways. The new work will concentrate on helping ease traffic congestion in the heavily urbanized areas of the west, including Amsterdam and Rotterdam. One of the main ongoing infrastructure projects in the Netherlands is the effort to prevent flooding. Over half of the country's territory is protected from flooding by an extensive system of dams and dikes.

In order to pay for current and future projects, the government established a special infrastructure fund. This fund is designed to provide supplemental money for infrastructure works without having too great an impact on the national budget. The fund is made up of proceeds from the sale of natural gas and any surplus tax funds. There are also plans to gain additional revenues by building toll roads and special pay lanes.

The nation has 125,757 kilometers (78,145 miles) of roads, 113,018 kilometers (70,229 miles) of which are paved. There are 2,235 kilometers (1,388 miles) of expressways that link the major cities and facilitate transportation from the coast across the country. All of the major Dutch cities have widespread and inexpensive public transportation systems. The high degree of urbanization has also led many Dutch cities to build comprehensive bicycle pathways that allow people to bike instead of using cars or other vehicles. Still, 79 percent of the Dutch use their personal cars for transportation.

The nation has 2,739 kilometers (1,702 miles) of railways. Transportation is also aided by an extensive network of waterways and canals. In total, there are 5,046 kilometers (3,135 miles) of waterways in the country, and 47 percent of these are usable by watercraft of 1,000 tons or larger. The main Dutch ports are Amsterdam, Dordecht, Groningen, Haarlem, Maastricht, Rotterdam, and Utrecht. Rotterdam is the world's largest seaport and handles more tonnage than any other harbor. Some 70 percent of all imports that go into the Netherlands come through Rotterdam. In 1996, the port set a record of 293.4

billion tons of goods received. Because of a trench that extends into the North Sea, supertankers and other large ships with capacities of up to 350,000 tons can access the port. The Dutch merchant marine includes 563 ships of at least 1,000 tons. These ships range from cargo and petroleum tankers to passenger cruise ships. There are 28 airports in the Netherlands, 19 of which are paved. Amsterdam Airport is Europe's fifth busiest airport. The country also has 1 heliport. The kingdom's main airline, KLM Royal Dutch Airlines, is one of the largest in the world and has partnership agreements with a number of other international air carriers.

In order to provide energy resources throughout the country, the Netherlands has a well-developed pipeline system. There are 418 kilometers (260 miles) of crude oil pipelines, 965 kilometers (600 miles) of pipelines for other petroleum products, and an overwhelming 10,230 kilometers (6,356 miles) of natural gas pipelines. In 1998, the nation produced 88.7 billion kilowatt hours (kWh) of electrical power. Some 400 million kWh of electricity were exported that year, but since the nation consumed 94.3 billion kWh of power, it had to import 12.2 billion kWh of electricity. Over 91 percent of electricity is produced by fossil fuels, while atomic energy provides 4 percent. Hydroelectric plants and solar energy provide most of the rest of the nation's energy needs. The kingdom is dependent on imports of oil and coal. However, the nation is a net exporter of natural gas, and it has extensive oil and natural gas fields in the North Sea. The government is highly supportive of efforts to develop solar energy resources. By 2020, the government plans to have solar energy account for 10 percent of energy consumption (this would supply the energy needs of 400,000 homes). In theory, the Netherlands could supply all of its energy needs through solar power. It would need 800 square kilometers (308 square miles) of surface for solar panels. This area is already available on the roof surfaces of houses and buildings.

The nation's telecommunications system is also highly developed. The government began privatizing the telecommunications industry in 1989. By 1997, service for all fixed line telephones was privatized. The country has 5 underwater cables for transatlantic communications and 3 earth stations which receive satellite transmissions. The nation maintains 2 communications satellites. There is a program underway to replace the existing communications cables with fiber-optic cable. Over 90 percent of homes in the Netherlands are serviced by cable television systems. Concurrently, there have been dramatic increases in the use of mobile phones. By 2000, there were 6.8 million mobile phones in use. The Dutch are among the first people in Europe to begin using the third-generation mobile communications systems which allow mobile phone users access to high-speed data (such as e-mail and the Internet) and video communications via their phone. In 1999, there were 70 Internet service providers in the Netherlands.

ECONOMIC SECTORS

The Dutch economy is dependent on foreign trade. Like most developed nations, during the second half of the 20th century the Dutch economy underwent a transformation in which agriculture and industry declined in importance while services came to dominate the economic activity. Nonetheless, the nation's fertile soil and deposits of natural gas and oil mean that both agriculture and industry remain competitive with similar sectors in other nations.

Agriculture and fishing are highly profitable even though they account only for a small percentage of employment and of the nation's GDP. Since the 1940s, Dutch agriculture has become highly mechanized and technologically sophisticated. Dutch farmers use the latest technology to maximize crop yields and livestock production. Techniques such as scientific soil analysis and increased use of fertilizers and pesticides have been largely responsible for doubling crop yields during the century. Crops and livestock provide both exports and products which fuel the nation's domestic food-processing industries. Despite the small size of the country, the Netherlands is the world's third-largest exporter of agricultural products.

The main industries in the Netherlands are agribusiness , metal and engineering products, electrical machinery and equipment, chemicals, petroleum, construction, and microelectronics. The Dutch have significant oil and natural gas fields in the North Sea. This forms the basis for the nation's large energy industry. With such resources companies such as Royal Dutch Shell have gained markets around the globe. Most of the kingdom's energy resources are exported to EU countries. Other major industrial employers include the Dutch State Mines and the Royal Netherlands Blast Furnaces and Steelworks (both of which are partially-owned by the government). Construction accounts for about 6 percent of GDP and is partially propelled by government spending on infrastructure projects.

Services dominate the Dutch economy. The main segments of the service sector are transportation, goods distribution, financial services, and tourism. One of the areas of greatest growth, however, is telecommunications, especially personal communications services. Computer services are also experiencing dramatic growth. Small companies which specialize in various types of service have done the best in the nation's economy over the past decade, but there is increasing consolidation in some areas of the service sector as large corporations buy or merge with the more profitable firms.

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.

INDUSTRY

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 8-10 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.

SERVICES

The services sector of the economy has experienced the greatest level of growth among the major Dutch businesses over the past 2 decades. Services now account for 69.7 percent of GDP according to a 1998 estimate. The most prominent fields within the service sector are banking and financial services, telecommunications, retail , and tourism.

BANKING AND FINANCIAL SERVICES.

The banking and financial sectors of the Dutch economy have increasingly come to be dominated by large firms. In order to compete with international banks, companies have had to merge so as to reduce costs and maximize efficiency. The 2 largest banks in the country—the General Netherlands Bank and the Amsterdam-Rotterdam Bank—merged in 1990 to become ABN Amro. ABN Amro is now one of Europe's largest banks. Recently, Postbank and the Netherlands Traders' Bank merged to create the king-dom's second-largest bank. In 1998, the Dutch insurance company Fortis merged with the large Belgian firm De Generale Bank. Financial services account for about 7.2 percent of the service sector. Other business services account for 10.5 percent of the sector.

In 1999 the banking sector of the Dutch economy was worth 1.33 trillion euros. The nation's banking sector employed 120,000 people in the Netherlands and 220,000 people worldwide. There are 115 banks in the nation. This number includes all major credit-granting institutions and foreign-owned banks. In 1999 there were 6,121 bank branches in the Netherlands, and Dutch banks had an additional 2,575 branches abroad. However, 3 large banks—ABN Amro, Rabobank and ING Bank— account for about 75 percent of lending in the kingdom.

TELECOMMUNICATIONS.

In 1999, the telecommunications market in the Netherlands amounted to US$10.3 billion. Over the next 5 years, the sector is expected to grow by 5-10 percent per year. About 85 percent of the market is based on telecommunications services, and the remaining 15 percent is equipment. In 1989, the government passed legislation which privatized telecommunications services. Nonetheless, the former state-owned telecommunications company KPN Telecom continues to dominate the sector. For instance, in the field of mobile phones, KPN Telecom controls 52 percent of the market. The next largest company, Libertel, controls 32 percent, and the third-largest firm, Telfort, controls 7 percent. The government is in the process of auctioning licenses for the next generation of mobile equipment. Despite the dominance of KPN Telecom, international corporations have gained an increasing share of the telephone market. Among the major international companies that are now in the Dutch market are MCI WorldCom, Global One, and Esprit Telecom.

A growing segment of the telecommunications sector is information technology or IT (computer-based information systems and communications). In 1999, the IT market in the Netherlands was worth US$11 billion. This represented a growth rate of 15 percent from the previous year. Over the next few years, forecasts predict that the field will continue to expand at a rate of 15 to 20 percent per year. The 2 largest Dutch IT firms are Baan and Exact. The government has attempted to promote the establishment of new IT companies under a program known as "Twinning." This program provides government funds for housing, business start-up, and financial advice. Despite this and similar programs, more than 60 percent of IT products and services are imported. The United States is the main supplier of IT goods and services to the kingdom. With more than 3 million Internet users, the Dutch have the highest rate of Internet usage per person in Europe. By 2002, there will be 7.5 million Dutch Internet users. E-commerce (the use of the Internet to purchase goods) was worth US$325 million in 1998, but this figure grew to US$1.1 billion in 1999, and is expected to be worth US$11.5 billion by 2002. Experts rank the Netherlands as being 12-18 months behind the United States in Internet usage and e-commerce.

RETAIL.

The Dutch retail sector is highly developed and diversified. In many ways it is similar to that of the United States. Supermarkets comprise 68 percent of grocery stores, while specialty stores make up 22 percent and the remainder includes food stores, local farmers' markets, department stores, and convenience stores. The Netherlands has about 12,600 clothing stores with combined sales in 1999 of US$5.3 billion. Over 60 percent of these are small retail units, and the rest are department stores or chain outlets. Employment in retail and clothing stores is 61,010. Nonetheless, as in the United States, there has been a steady trend toward larger retail units and a decline in small specialty stores.

TOURISM.

In 1999, the Dutch spent US$10 billion on tourism, but US$8 billion of this was spent outside of the country. The Dutch tend to travel extensively, and 4 out of 5 have traveled on vacation at some point in their lives. In 1999, there were 30.5 million overnight vacation trips, of which 16.3 million were within the Netherlands. Tourism accounts for 5 percent of all employment in the Netherlands and includes 45,000 companies. Over 95 percent of these companies have fewer than 10 employees. In 2000, tourism was one of the 4 fastest-growing sectors of the Dutch economy, and by 2010 there will be an additional 5,000 hotel rooms built. Within tourism, short trips (those of 2 to 4 days) are becoming the most popular form of vacation. The United States is the most popular destination for Dutch tourists and accounts for about 25 percent of the total overseas tourism market. The most popular destinations for Dutch tourists are New York, Los Angeles, San Francisco, and Miami. Of those who visit tourist destinations in the Netherlands, 52 percent are Dutch and 48 percent are foreign. Germans are the main tourist group to visit the kingdom, followed by the British.

INTERNATIONAL TRADE

Almost 160 million people live within a 300-mile radius of Rotterdam. This includes more than half of the population of the EU. As a result, the Netherlands is perfectly positioned as a gateway for goods being imported into the EU. In addition, Dutch goods are easily exported throughout the region. In all, 80 percent of Dutch exports go to other nations within the EU and 70 percent of goods imported into the Netherlands come from the EU. Asia accounts for only 17 percent of the nation's exports and 7 percent of its imports. The largest individual destination for Dutch goods is Germany at 27 percent, followed by Belgium-Luxembourg at 13 percent, France at 11 percent, the United Kingdom at 10 percent, and Italy at 6 percent. Imports are divided between Germany with 20 percent of the total, Belgium-Luxembourg with 11 percent, the United Kingdom with 10 percent, the United States with 9 percent, and France with 7 percent. The Dutch are the ninth-largest trading partner with the United States and the third-largest in Europe. The United States has its largest trade surplus with the Netherlands, averaging US$10 billion per year.

The Netherlands leads its EU partners in issues such as trade liberalization and the privatization of key industries such as telecommunications and transportation. Thus, it is in a good position to continue its trade surplus. In 1999, its trade surplus in both goods and services amounted to US$18 billion. This represented a 6 percent growth rate over the previous year and accounted for 6 percent of the kingdom's GDP. Dutch exports are concentrated in products that tend to do well even during periods of recession. These exports include food and agricultural products and energy resources.

In 1998, the Dutch exported US$169 billion worth of goods and services and imported US$152 billion. This represented a 5 percent increase in exports over the previous year and continued a trend of positive growth in exports which extends back into the 1980s. Services were the fastest growing exports and increased 6.9 percent in 1998, while the export of manufactured goods increased by 3 percent.

Because of the importance of trade and the impact of foreign sales on the Dutch economy, the government is a staunch supporter of global free trade. The Netherlands has worked closely with the United States to open markets around the world and reduce tariffs and other impediments to international commerce. The country works through international organizations such as the World Trade Organization (WTO) and the International Monetary Fund (IMF).

The main international organization which has aided the Dutch economy has been the European Community, now known as the EU. Before the formation of this regional organization, about 40 percent of Dutch trade exports went to the nations of Europe. However, exports to Europe now account for about 80 percent of Dutch exports. The Netherlands was one of the founding members of the organization and has consistently supported increased economic integration among its members, including the establishment of a common currency, the euro. Because the use of the euro will reduce transaction costs between countries by eliminating differences in currency exchange rates , the implementation of the euro is expected to add US$3.5 billion in new business to the Dutch economy. It is also expected to increase foreign investment in the Netherlands by US$2.5 billion.

Since the end of the Cold War and the opening of Central and Eastern Europe to free-market capitalism, the Dutch have aggressively sought to gain access to the emerging markets in countries such as Poland, Hungary, and the Czech Republic. They have also supported international efforts to reform the economies in the region in order to facilitate increased trade, and they support EU expansion to bring countries in the area into the trade organization.

The geographic location of the Netherlands and its highly skilled and productive workforce has attracted numerous international companies. By 2000, there were 6,400 foreign businesses with operations in the kingdom. These companies employed 357,000 Dutch workers. In order to encourage new investment and attract foreign companies, the Dutch government established the Foreign Investment Agency. This agency has overseen the implementation of 85 different projects with a combined value of US$531 million. These projects also resulted in 5,000 new jobs. The Dutch government offers grants of up to 20 percent of the start-up costs of new companies. The bulk of foreign investment in the Netherlands is from the United States (in 2000 the U.S. accounted for 80 percent of new investment). Total American investment in the kingdom is US$106 billion. The majority of U.S. investments were in financial services and real estate. The Netherlands is the third largest recipient of U.S. investment in the world.

MONEY

The Dutch guilder or florin has fallen in value in relation to the U.S. dollar and other major European currencies. In 1995, 1 U.S. dollar was equal to 1.6057 guilders; however, in 1999, one U.S. dollar equaled 1.8904 guilders. The weakness of the Dutch currency has actually helped the nation's economy since it has made Dutch products cheaper and therefore more marketable. In 1999, the kingdom was one of the founding members of EMU. EMU created a single currency, the euro, for the EU nations which replaced national currencies in 2002. The euro is fixed at a rate of 2.20371 guilders per euro. Since its introduction, the euro has been weak against the U.S. dollar. In 2000, 1 U.S. dollar equaled 0.9867 euros (when the euro was introduced it was equal to US$1.1789). The low value of the euro is expected to continue to help Dutch exports when the nation adopts the currency.

Banks in the Netherlands manage the transfer of funds and securities and handle savings and checking accounts. They also assist companies in stock offerings. The banking system is overseen by the government-owned Dutch national bank, De Nederlandsche Bank, or DNB. The bank also oversees monetary policy . As a member of the European System of Central Banks, DNB coordinates with other European national banks on issues of monetary policy and national economies, as well as the implementation of EMU. Foreign-owned banks are allowed to operate in the kingdom according to the same rules and regulations as Dutch banks.

In 2002, the Amsterdam Stock Exchange will celebrate its birthday as the world's oldest stock market. The exchange has developed close ties with stock markets in Belgium and Luxembourg, and almost half of the investments in the Amsterdam Exchange come from foreign investors. The Amsterdam Exchange lists 972 different companies or investment institutions, of which 604 are Dutch and the rest foreign-owned. In 1999, the total value of the exchange was 1.497 trillion euros.

POVERTY AND WEALTH

Like most of the West European nations, the Dutch have a high standard of living. In 2000, the nation's GDP per capita was US$25,695. According to the United Nations Human Development Report 2000, the Netherlands ranks number-eight in the world in human development, ahead of nations such as Japan and the United Kingdom, but behind countries such as the Canada, Norway, and the United States. This report measures such features as income, literacy, and life span.

The wealthiest 10 percent of the population control 24.7 percent of the kingdom's wealth while the poorest 10 percent only control 2.9 percent. There are also regional differences in wealth and standard of living. People who live in the southern and western regions of the country tend to have higher incomes as the higher-paying industrial and new technology companies are concentrated in these regions. The northern area of the kingdom is the most rural and least prosperous area of the Netherlands.

While unemployment is low in the Netherlands, at 3.5 percent, as many as 100,000 people have simply dropped out of the labor force . The nation has generous social benefits and this has prevented the widespread expansion of poverty. The Dutch national drug policy continues to have an impact on poverty. The Dutch government differentiates between "hard" drugs, such as heroin or cocaine, and "soft" drugs such as marijuana. The sale and use of small quantities of soft drugs is legal, under certain guidelines. However, the use of hard drugs has risen over the past 2 decades. The government now spends about US$150 million per year on rehabilitation programs for the estimated 28,000 hard drug users in the kingdom (most of whom are unemployed and live below the nation's poverty line).

The poverty rate in the Netherlands is 4.7 percent of families. This gives the nation one of the lowest poverty rates in Europe, second only to nations such as Sweden, and well ahead of countries such as the United Kingdom, Germany, France, and the United States. However, the main reason for this low rate is generous social payments. If government aid is excluded, the poverty rate in the

Netherlands rises to 18.9 percent. The highest rates of poverty are among individuals, but single-parent households account for almost 75 percent of all poor families.

WORKING CONDITIONS

In 1999, the Dutch labor force numbered 7.13 million. Of this total, 4.02 million were men and 3.11 million were women. Full-time workers numbered 4.12 million, while part-time employees numbered 3.01 million. The large number of part-time workers reflects the growth of the service sector as many jobs in this segment of the economy are part-time. This is especially true of retail workers. Of the total number of employees, 805,000 had seasonal or temporary jobs. The nation had an unemployment rate of 3.5 percent in 1999. However, this figure does not truly represent those out of work in the kingdom, since an estimated 50,000 to 100,000 former or potential workers have simply dropped out of the labor force and decided to rely on the Netherlands' generous social benefits rather than try to find employment.

Dutch workers have the constitutional right to join unions. This includes all workers, even members of the military, police, and civil service. Although only about 28 percent of the workforce are active members of unions, collective bargaining agreements cover 75 percent of workers. Currently, union membership among professional workers is expanding. Organized strikes are rare in the country, and labor relations are generally regarded as harmonious. Discrimination against union members is illegal. Several major unions are presently undertaking widespread efforts to reduce the national work week to 36 hours.

Unions and private employers negotiate work contracts, known as social partnerships, which establish wage levels and benefits for workers and production targets for the companies. These contracts are renegotiated in the fall of every year and cover all workers, even those who do not belong to the union. Worker relations and union issues are

overseen by the national Social and Economic Council which also advises the government on labor matters. As in many other nations, there are disparities between male and female workers in terms of hiring, salary, and promotions. Although gender discrimination is forbidden by law, women continue to earn less than their male counterparts in similar occupations. In 1999, women on average made only about 75 percent of what men earned in equal jobs.

Child labor is forbidden by law, but each year there are minor violations, especially around the Christmas holidays when children are often employed for holiday-related work. The minimum age for a person to begin work is 16 years old. But at 16, people may work only 8 hours per week. Anyone under the age of 18 may not work at night or work overtime. They are also prevented from working in hazardous occupations. Full-time employment for those 18 years old or younger is dependent upon their completion of 10 years of mandatory education. All employees must be given a 30-minute break after they complete 4.5 hours of work.

The nation's minimum wage can be changed every 6 months to adjust for inflation. However, only about 3 percent of workers earn the minimum wage, since most workers are covered by union-employer contracts. The minimum wage is US$1,172 per month. Those employees who earn minimum wage receive social security benefits and medical insurance which is paid for by the employer. These costs work out to approximately US$3,750 per worker. Employees under the age of 23 receive a percentage of the national minimum wage. This percentage ranges from 34.5 percent of the adult minimum wage for workers who are 16 years old to 85 percent of the wage for workers who are 22 years old. Labor costs in the kingdom have risen slower than inflation. In 1999 average wages rose by 2.5 percent which was only slightly higher than the inflation rate of 2.1 percent. In addition, advances in productivity offset wage increases as Dutch workers produced more goods per hour than they had the year before. This helped businesses maintain their profits and prevented an acceleration of inflation.

Under the law, the national work week is 40 hours. However, social partnership contracts have reduced the average work week for most employees to 37.5 hours per week. In addition, an increasing number of employees work non-traditional schedules. Telecommuting (working from home, using a computer or other equipment) is growing in popularity. Worker safety and working conditions are overseen by the Labor Commission. Under Dutch law, employees may refuse to work in hazardous occupations if they feel their safety is in jeopardy.

COUNTRY HISTORY AND ECONOMIC DEVELOPMENT

300 B.C. Germanic and Celtic tribes settle in the region that is now the Netherlands.

1018. Dirk III, Count of Holland, is the first to use the name Holland in his title.

1205. Amsterdam is founded.

1323. Holland gains control of Zeeland from Flanders.

1428. Holland is conquered by the Burgundians of France.

1477. The Hapsburgs gain control of Holland.

1515. Charles I incorporates Holland into the Holy Roman Empire.

1555-79. Charles I turns Holland over to his son Phillip II, King of Spain. The Dutch rise in revolt against the Catholic Spanish as Protestantism spreads throughout the region.

1581. The next 200 years is considered to be the "Golden Age" of Holland as trade flourishes and the country becomes one of the most prosperous and wealthy nations in the world. This prosperity is based on the nation's merchant fleet which transports goods around the globe.

1602. The Dutch East India Company is founded to expand trade with India and Asia. An early stock market is established.

1609. A bank is established in Amsterdam to exchange currency and to provide a safe place to deposit money.

1621. The Dutch West India Company is established to trade with North and South America. The nation again goes to war with Spain (1621-48).

1625. New Amsterdam is founded on Manhattan by the Dutch West India Company.

1648. Trade increasingly shifts away from Antwerp and Ghent to Amsterdam.

1795. The Netherlands is conquered by the French. The French establish the Batavian Republic and initiate a period of governmental and economic reforms.

1806. Louis Bonaparte is made king of Holland by his brother Napoleon Bonaparte.

1806-13. Napoleon attempts to make Holland the central economic power of the "Continental System" which was designed to cut off trade with Great Britain.

1814. After liberation from the French, the country becomes the Kingdom of the Netherlands under King William I. Under William a number of economic reforms are enacted, including a reorganization of the nation's international trade companies.

1815. Dutch troops help defeat Napoleon at the Battle of Waterloo. Belgium is made part of the Netherlands by the Treaty of Versailles. The Dutch attempt to encourage industrialization in Belgium.

1831. Following a revolt, Belgium is granted independence over a 10-year period.

1848. After liberal revolutions that sweep across Europe, the constitution is revised.

1849-90. The reign of William III. During this period, the modern system of political parties is established. Also during William's reign, revelations about harsh treatment of natives lead to reforms in the kingdom's East Indies colonies. Revolts in these colonies drain the national treasury and lead to questions over the economic value of the territories.

1870. Widespread industrialization begins in the Netherlands, much later than in the rest of Europe.

1914-18. The Dutch remain neutral during World War I. The government acts to maintain the nation's economy during the war in the face of naval blockades by both Great Britain and Germany.

1920. KLM Royal Dutch Airlines begins regular air service between Amsterdam and London.

1930s. The economy of the Netherlands is damaged by the Great Depression.

1939-45. When World War II breaks out, the Netherlands tries to maintain its neutrality but it is invaded by Germany in 1940. The Dutch colonies in Asia are conquered by the Japanese. The Allies liberate the kingdom and its colonies at the end of the war in 1945. However, after liberation the colonies in Indonesia begin a revolt and are granted independence in 1949.

1944. The Netherlands joins a customs convention with Belgium and Luxembourg. This association will evolve into the Benelux Economic Union in 1958.

1949. The kingdom is one of the founding members of NATO.

1952. The Netherlands joins the European Coal and Steel Community.

1957. The country becomes one of the founding members of the European Community. Disastrous flooding leads to the development of a comprehensive plan to control waterways and prevent future flooding.

1974. The last coal mines in the south of the kingdom close.

1980. The global recession, caused by the oil crisis of 1979, leads to a collapse of the housing market. Queen Juliana abdicates in favor of her daughter Queen Beat-rix (the present monarch).

1982. The nation undergoes a severe economic recession.

1993. The Netherlands begins a period of dramatic economic growth which lasts into the next century.

1999. The Netherlands joins EMU.

FUTURE TRENDS

The most important event for the Dutch economy in the 21st century is the introduction of the euro and the subsequent discontinuation of the use of the guilder in 2002. With EMU, the Dutch will gain a number of advantages, including even lower transaction costs for importing and exporting goods with its EU partners. However, EMU will also mean that the Dutch have less control over their monetary policy, since a new European Central Bank will control most aspects of policy surrounding the euro. This might be problematic for the Dutch since the government has traditionally used monetary policy to help trade. EMU will probably mean that the Dutch will have to make a stronger effort to control inflation. This could potentially slow down the economy's rapid growth.

One potential domestic problem for the Dutch economy is that prosperity across the nation is not uniform. The northern regions tend to be less affluent and have less industry than the southern and western regions. In light of this problem, the government has initiated a variety of programs to attract new business to the less-prosperous regions. However, these programs have not had a major impact on the regions' economy yet.

The kingdom's abundant natural gas supply and its strong agricultural sector will help the nation do well even in case of an economic recession among the EU nations. Although the Dutch economy is dependent on foreign trade, exports of energy supplies and foodstuffs tend to remain strong even during economic downturns. In addition, the presence of a number of large, multinational firms in the country means that foreign trade is likely to continue to expand as these corporations persist in opening new markets for Dutch goods and services and provide access to new or less expensive products and services for Dutch consumers.

The expanding trade between the United States and the Netherlands also bodes well for the future of the Dutch economy. The United States remains the largest single market for products and services in the world. Because of their volume of trade with the EU and the United States, the Dutch have access to both of the globe's main consumer markets. Dutch trade with Asia continues to lag, however, and efforts to improve exports to the region have not been successful because of the competitive nature of the market and the area's economic slowdown in the late 1990s.

DEPENDENCIES

The Netherlands has no territories or colonies.

BIBLIOGRAPHY

CPB Netherlands. Challenging Neighbors: Rethinking German and Dutch Economic Institutions. New York: Springer, 1997.

Organization for Economic Cooperation and Development (OECD). OECD economic surveys: The Netherlands, 1998/99. Paris: OECD, 1999.

Organization for Economic Cooperation and Development (OECD). Regulatory Reform in the Netherlands. Paris: OECD, 1999.

U.S. Central Intelligence Agency. World Factbook 2000: Netherlands. <http://www.cia.gov/cia/publications/factbook/geos/nl.html>. Accessed February 2001.

U.S. Department of State. Background Notes: Netherlands. <http://www.state.gov/r/pa/bgn/index.cfm?docid=3204>. Accessed February 2001.

U.S. Department of State. FY 2001 Country Commercial Guide: Netherlands. <http://www.state.gov/www/about_state/business/com_guides/2001/europe/index.html>. Accessed February 2001.

U.S. Department of State. "The Netherlands: Country Reports on Human Rights Practices: 1999." <http://www.state.gov/g/drl/rls/hrrpt/1999/index.cfm?docid=349>. Accessed February 2001.

Van Zanden, Jan Luiten, editor. The Economic Development of the Netherlands Since 1870. Brookfield, Massachusetts: Edward Elgar Publishing, 1996.

—Tom Lansford

CAPITAL:

Amsterdam is the constitutional capital; the official seat of the government is The Hague.

MONETARY UNIT:

Netherlands guilder (Dfl or Fl), also known as gulden or florin. One guilder equals 100 cents. Coins are in denominations of Dfl1, 2.5, and 5, and 5, 10, and 25 cents. Paper currency is in denominations of Dfl10, 25, 50, 100, 250, and 1,000. The euro, the currency of the European Union, replaced the guilder on 1 January 2002.

CHIEF EXPORTS:

Machinery and equipment, chemicals, fuels, foodstuffs.

CHIEF IMPORTS:

Machinery and transport equipment, chemicals, fuels, foodstuffs, clothing.

GROSS DOMESTIC PRODUCT:

US$365.1 billion (purchasing power parity, 1999 est.).

BALANCE OF TRADE:

Exports: US$169 billion (f.o.b., 1998 est.). Imports: US$152 billion (f.o.b., 1998 est.).