The Hon. Geert Wilders of the Dutch Freedom Party (PVV) is serious about the Netherlands leaving the bureaucratic morass of the EU. That would include returning to the Guilder instead of the Euro as the currency. Yesterday, he held an important news conference at The Hague and released the findings of an assessment of what the proposal would mean to the Netherlands and its citizens.
The NExit report, “Assessing the economic impact of the Netherlands leaving the European Union” was prepared by the London-based Capital Economics, Ltd. It purports to be a macro-economic analysis of the effects of exiting the EU in terms of future impacts on gross domestic product, national and personal income, as well as the costs and benefits. NExit puts gravitas behind Wilders proposal. It should be considered the opening bow shot in the upcoming May 2014 European Parliamentary elections where Wilders has already built up a head of steam in the polls in Holland. Further there are the burgeoning alliances with similar Eurosceptic parties like Vlaam Belang in Belgium and Marine le Pen’s National front in France and other parties in the EU.
We have been through the NExit report and found it professionally well done. Its methods, assumptions and findings appear credible. In light of that we find the mainstream reports, to be uniformly dour hewing to the line that polls in The Netherlands are unfavorable. In terms of the upcoming European Parliamentary elections the PVV may be in a lead position to pick up a majority of the Dutch delegation seats. Dutch opinion heretofore has allegedly been not sanguine about the PVV Euro skeptic proposals. That is until now. The NExit report puts flesh on the bones, of how the average Dutch citizen and the national economy would benefit.
Overall the Capital Economics NExit report finds “overall, the various strands of analysis point to NExit being a long term benefit to the Dutch economy and, more than likely, a short term help in easing the Netherlands out of its current economic ills”.
The Report notes that if the NExit project began in January 2015 under a so-called Swiss-like relationship between the Netherlands and the European Union the aggregate economic impacts would be:
- Gross Domestic Product would grow by 10 to 13 percent by 2035 than if the country remained in the EU;
- National Income would have increased by 1,100 to 1,500 billion Euros equivalent to 7,100 to 9.000 per house and per year.
How would these tantalizing economic benefits be achieved? Here is what the Capital Economcs NExit report finds:
- Costs of doing business in Holland would be reduced by a minimum of 20 billion Euros;
- Public finance would add a cumulative 240 billion to GDP by 2035;
- Public spending would be reduced by 7.5 billion Euros through revised immigration policies;
- Expansion of trade with both major trading partners and emerging growth countries;
- Tailoring monetary and fiscal policies to the needs of the Netherlands economy add a cumulative 309 billion Euros by 2035.
Capital Economics NExit report suggests that based on its macro-economic assessment that the costs of the transition are manageable. That fears of a revaluation of the Dutch Guilder against the Euro are unfounded and the volatile swings in currency trading on a continuing basis following transition are expected to be minimal. Moreover, Capital Economics believes should have minimal impact on the country’s banking system, its sovereign debt and national pension system.
The Wall Street Journal (WSJ) report, “Dutch Nationalist Pushes for EU Exit”, quoted Wilders saying, “Leaving the EU will restore the national sovereignty and boost our economy. It offers the Netherland a way out of the crisis. The transition costs will be temporary and manageable.” There are of course skeptics in both the Netherlands and EU who are dismissive of both Capitol Economics, the consulting group that produced the 159 page report calling the underlying assumption ‘unrealistic’. Capitol Economics authored a 2012 report on the benefits of dismantling the Euro zone. The WSJ cited Dutch Finance minister, Jeroen Dijsselbloem saying that leaving the EU would be “very unwise” for the Dutch economy and business.
Whether the NExit report’s potentials can be realized depends on election of PVV Members in the majority of the Dutch delegation to the European Parliament in Strasbourg. Wilders is first past the post with a plan that he can point to that appears to offer a credible and highly attractive alternative to the economic stasis that the Netherlands and many leading member countries of the EU find themselves in for the foreseeable future.
EDITORS NOTE: This column originally appeared on The New English Review.