The Dutch economy will shrink 7.5 percent this year before recovering in 2021 according to a new study by the International Monetary Fund, which predicts that the coronavirus crisis will cause “the worst economic downturn since the Great Depression.” However, it also predicted that the economy would bounce back in 2021 with 3 percent growth, though by next year, the country’s unemployment rate is likely to have doubled from just 3.4 percent to 6.5 percent.
The IMF’s forecast for the Netherlands is in line with CPB, a Dutch forecasting agency. The CPB analyzed four potential scenarios for the next two years that varied according to the length of shelter in place directives that limit physical contact. All four scenarios result in a recession, with GDP falling by between 1.2 percent and 7.7 percent in 2020. In three of the four scenarios, the economic downturn will be more serious than in the 2008-2009 crisis, when GDP fell by 3.7 percent.
