Category: Innovative Technologies
Long-term economic stability: what companies need to sustain growth in uncertain times
To most of us, the degree of uncertainty we are facing today is completely new. As the pandemic continues without concrete signs of relief, companies are careful to make big decisions and to expand their business onto new markets. According to UNCTAD’s World Investment Report 2020, global foreign direct investment (FDI) flows are forecasted to decrease by up to 40% in 2020. And we can only imagine how things will be in 2021.
“Never waste a good crisis” must be the most used quote in 2020 so far. Diversifying your business into a more resilient model by ensuring that your company relies on income from various markets can be an especially good move in uncertain times. If one market crashes, others may stay strong, ensuring a healthy overall business performance. For companies looking to expand into new markets, it is time to get well informed so you can make the right decision for your internationalization steps. Economic stability has become the most important factor when choosing a new market for business expansion. Let us inform you why the Netherlands should be at the top of your expansion list.
The worlds’ most care-free place for full-focus on business growth
For companies looking for a stable, transparent and predictable environment to expand their business into the EU market, the Netherlands provides the right location.
Especially when considering the total of 5 of the most prominent political economic rankings: IMD World Competitiveness Ranking, WEF Global Competitiveness Report, Global Innovation Index, Human Development Index and the World Happiness Report. When combining these rankings, the Netherlands ends up at number 2, just after Switzerland.
These high scores are not based upon incidental events: We appear consistently in the top 10 – but more regularly in the top 5 of most relevant rankings.
However, The devil’s in the details, so let’ take a deep dive into those lists. The Netherlands scores 100/100 points in macro-economic stability in WEF’s Global Competitiveness Index 2019. This means that companies and subsidiaries in the Netherlands can focus their efforts fully on growing their businesses, while simultaneously enjoying our top-performing infrastructure (rank #2 following only Singapore), our highly skilled workforce (rank #4) and top-notch business dynamism (rank #2).
The IMD World Competitiveness Index demonstrates a particularly favourable economic performance in the Netherlands (rank #1), with factors such as International Trade, Employment & Labor market and Technological Infrastructure.
Forbes comes to similar conclusions in its ‘Best Countries for Business’ report: The Netherlands ranks #4 overall, with particularly high scores on the subjects of property rights, lack of corruption, innovation, monetary freedom and personal freedom. Forbes describes our country as, “the sixth-largest economy in the European Union, [which] plays an important role as a European transportation hub, with a consistently high trade surplus, stable industrial relations, and low unemployment.”
The World Bank ranks the Netherlands number 2 in the European Union on the Government Effectiveness Index and grants our country the lowest possible score on all risk indicators:
The Netherlands government provides a safe location for companies to invest and work in and have their investments and legal rights secured. For many years we consistently rank in the top 10 on the global Corruption Perceptions Index (CPI). This index is published annually by Transparency International and it ranks countries by their perceived levels of public sector corruption, as determined by expert assessment and opinion surveys.
Economic stability; just one of several reasons to invest in the Netherlands
In this article, we have discussed the economic and political stability in the Netherlands and how it enables companies to focus on what matters to them: growing their companies. Four more articles can be expected, that will dive deeper into other major reasons to invest in the Netherlands:
Our innovation infrastructure (and thriving business clusters), the availability of talent, the high productivity and superb quality of life. To warm you up, I have summarized these topics below:
Where innovation flows into commercial success
The Netherlands is one of the most innovative economies in the world, ranked at the 5th place in the recently published Global Innovation Index 2020. Right behind Switzerland, Sweden, US and UK. We have been consistently investing in our innovation ecosystem. For example, we have developed a network of fieldlabs, providing (sometimes funded) collaboration programmes, shared R&D and testing facilities, access to (academic) knowledge and often appropriate exemptions on regulations, to enable the testing of innovative applications that don’t fit into the current regulatory context.
Innovative companies are also supported by a competitive corporate tax regime that stimulates innovation, as well as entrepreneurship and foreign investment in the Netherlands. According to the International Tax Competitiveness Index of the Tax Foundation, the Dutch system is the 5th most competitive worldwide. This index ranks how well a country’s tax system promotes sustainable economic growth and investment. The Dutch tax regime is particularly supportive of innovative companies, by providing significant tax exemptions for R&D expenditures as well as on income from innovative products and services.
Availability of talent
Greater Rotterdam – The Hague is home to three world-renowned universities – Erasmus University Rotterdam, Delft University of Technology and University Leiden – and various universities of applied sciences and vocational education. Our talent pool has the 3rd highest performance in the world. As a result, we have the world’s 4th lowest talent shortage and a relatively high amount of available IT talent.
Did you know that our tiny country is the second-largest exporter of agricultural goods in the world? Right behind the US, which is over 235 times larger! Overall, we have an excellent digital and physical infrastructure with the 2nd largest internet exchange and the best port infrastructure in the world. Our geolocation gives access to over 300 million consumers within 24h by regular road or rail transport. These are excellent conditions to grow your business into the European market.
Quality of life
Imagine watching your company grow, while you and your team enjoy just the work-life balance that you always wanted but thought wasn’t achievable. Talent eagerly relocates to your company’s vicinity just at the thought of that every-morning bicycle ride. Traffic jams are a thing of the past. Stay posted, because we will convince you that it makes perfect business sense to weigh quality of life into the equation when selecting the location for your business expansion.
Make your brain love our region too
Economic and political stability is always a weighing factor in Foreign Direct Investment decisions, and even more so in uncertain times. Especially in the current situation, diversifying sources of income is a sensible way to mitigate risk. There isn’t a safer place to grow your business at this moment than the Netherlands. Get in touch and let us advise and support you in your business expansion or stay tuned for more compelling facts that will make your brain love our region too.
Interested in establishing your business in the greater Rotterdam - The Hague region?
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