Data released on Friday by the Central Bureau of Statistics (CBS) show that the Dutch spent 2.6% more than a year earlier. And that’s good news according to macroeconomist Edin Mujagic. “Because when money moves, the economy grows.”
He admits the increased spending sounds surreal, especially considering everything is more expensive, but CBS also corrected for the price increase in its calculation. “So in terms of volume, we started spending more,” Mujagic said. “And that in itself is good news, because when money moves, the economy grows.”
However, Mujagic points out that with these kinds of figures, it’s not just the main figure that should be considered, but also the world behind that number. “Then you can see that there are some points of concern in that figure.”
Services
For example, the biggest increase in spending is in the services sector, Mujagic says. Compared to last year, for example, the Dutch were able to eat out or go to the cinema more often in February. Last year, that sector in particular was still suffering greatly from the coronavirus measures, Mujagic says. “For example, people often had to show the corona app, which prevented many people from going out a lot last year,” he explains. “That means the base is low and rapid growth is possible.”
“It means the base is low and rapid growth is possible”
Mujagic himself thinks it’s important to look at spending on durable goods like furniture and other things that consumers generally buy more quickly in times of economic prosperity. This figure shows that less money has been spent.
Corona effect
And while this may also be due to the corona effect, Mujagic points out that total sales in the retail sector are down 3% compared to February last year, according to Statistics Netherlands. “It’s not necessarily bad for the Netherlands or the Dutch economy, but it’s yet another piece of the puzzle which, in my view, indicates that we won’t be able to maintain last year’s high economic growth,” he says . “From now on, things will be worse for the rest of this year.”
Source: BNR
Andrew Dwight is an author and economy journalist who writes for 24 News Globe. He has a deep understanding of financial markets and a passion for analyzing economic trends and news. With a talent for breaking down complex economic concepts into easily understandable terms, Andrew has become a respected voice in the field of economics journalism.
