Rabobank Group

With substantial downward risks and gloomy prospects, the Dutch economy is forecast to grow only slightly in 2012. The global economy is veering towards a major slowdown in growth and this makes a mild recession in late 2011/early 2012 likely. Both the braking effect of the eurozone crisis and the slowdown in economic growth in emerging economies are turning out to be stronger than expected.

The eurozone crisis is also standing in the way of the economic recovery in the rest of Europe. While growth in the eurozone was already slipping, it is set to fall even more sharply as the European debt crisis gets further out of hand. This also makes a recession in the eurozone increasingly more probable. It is important to note that the Rabobank economists are foreseeing a mild recession rather than a ‘Lehman event’, although this forecast is based on the explicit assumption that the eurozone will remain intact. They also foresee a number of weak years on the horizon even once the eurozone crisis has been solved, in part due to the fact that the possibilities for economic stimulus have been exhausted.

Rabobank annually presents its forecasts for the coming year in Outlook. Alongside the macroeconomic Outlook 2012 publication, a theme brochure is being published with the title ‘How flexible is the world? The role of technology and innovation’. In this study the Rabobank economists examine the impact of innovation and technological progress on the economy and business community. They envision innovation’s role as an engine of growth increasing in the decades ahead due to demographic shifts (ageing population), but conclude that the Netherlands only scores moderately in the area of innovativeness. The interviews with Dutch companies included in the publication nonetheless demonstrate tremendous innovative drive and well-considered entrepreneurship.