The European country fell into recession, with GDP growth in the red for the second consecutive quarter

The threat of global economic recession is not yet over. Thus, the fear about the world’s largest economy, the United States, has decreased somewhat, but many countries are still in serious danger of recession. After Germany, now another European economy is in the grip of recession.

Growth was negative in two quarters

The National Statistics Office of the Netherlands released official GDP figures on Wednesday. According to statistics, the GDP of the Netherlands decreased by 0.4% in the quarter of June 2023. This means that the volume of the economy of the Netherlands decreased by 0.4% during the period from April to June 2023. Earlier, in the first quarter of 2023, the Netherlands’ GDP growth rate was negative. In the period January to March 2023, the volume of GDP of the Netherlands decreased by 0.3%.

This is how a recession is detected.

According to the standard definition of economics, if an economy registers a growth rate below zero for two consecutive quarters, then the economy is considered to be in recession. As the Netherlands’ economy has now contracted for two consecutive quarters, it has officially been declared in recession. Earlier, the GDP growth rate of Germany, Europe’s largest economy, has also been below zero for two consecutive quarters.

Recession due to these reasons.

While giving information about the GDP figures, the Central Statistics Office of the Netherlands said that the main reason for the negative growth rate during the June quarter was the decline in household consumption. According to CBS, people bought less furniture and clothes during the quarter under review. On the other hand, spending in sectors like culture and entertainment increased. During the quarter, the Netherlands’ imports increased while exports fell. This also pushed the economy into recession.

These things of comfort and concern

It is a relief that the recession in the Netherlands is not too severe. A 0.4 percent decline in the next quarter, after a 0.3 percent decline, is a sign of a mild recession. On the other hand, it is worrying that the Dutch economy has been under pressure for the fourth quarter in a row. Growth was almost zero for two consecutive quarters before turning negative in the January-March quarter. In other words, the Dutch economy has not been able to grow for a full year, while it has declined in the last six months.

Also Read: Retrenchments Happened, Full Year’s Record Broken In 7 Months, Over 2.25 Lakh People Affected

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