Holland has benefited enormously from the euro. We have an enormous trade surplus, because of our export to those eurozone countries because of the euro.
Or, that is at least the excuse trotted out by our current Finance minister Jan-Kees de Jager (yes, one of THEM) in defence of decisions to give away all of our sovereignty in order to ‘save the euro’. Supposedly it is in our own interest that the euro lives.
But is it true? Dutch daily De Pers does a nice bit of myth-busting. Conclusion: Busted!
The statement is untrue. Holland has not benefited ‘enormously’ from the euro. The shared currency did not lead to a greater exports to eurozone countries and a subsequent ‘enormous’ trade surplus. Holland has a surplus because it is competitive and thrifty.
While it is true the trade balance surplus has increased under the euro, that growth of surplus started already way back in the 1980’s, according to the Central Bureau of Statistics (CBS).
The net effect of the euro on European trade has estimates ranging between zero en 10%, with the ECB itself estimating the effect to be in the lower end of the scale. Near zero, therefore.
Increased trade does not necessarily lead to a trade surplus. According to Central Planning Bureau economist Arjen Lejour there’s an equal chance the increased trade would have cause increased imports, lowering the surplus.
That the surplus increased has two causes: Firstly, Holland is competitive because of moderate wages coupled with a high productivity. Secondly, the Dutch save more then they spend.
Besides, since 2002 Dutch exports to other eurozone countries has decreased from 61% to 58% of total exports, indicating that the Netherlands has benefited mostly from growth in world trade.
So, no measurable benefits. But the current crisis is one that was spawned by the very currency were/are promised to benefit from. What is the euro good for, anyway? Can we leave now?