Recently, a report released by a Dutch bank has raised concerns about the potential impact of a 25% tariff imposed by the United States on European Union countries including the Netherlands. The report suggests that such a tariff could lead to an increase in inflation and result in a significant decrease of about 50% in Dutch food exports to the United States, thereby causing a major impact on the Dutch economy.
The ongoing trade disputes between the United States and its trading partners, including the recent retaliatory tariffs imposed on Mexico and Canada, are exacerbating tensions. Given that the Netherlands is a significant export destination for the United States, particularly in sectors such as technology, agriculture, and machinery, any increase in tariffs imposed by the US could have a profound impact on Dutch businesses and consumers.
Klaas Knot, the President of the Dutch central bank, expressed grave concerns over the situation, labeling it a game with only losers, ultimately warning that consumers would bear the brunt of these measures. He highlighted the potential for higher tariffs to worsen inflation, making goods more expensive for consumers. Knot cited an example from 2018 when President Trump imposed additional tariffs on washing machines, leading to increased prices for consumers.
Bert Colijn, the Chief Economist at the Dutch bank, analyzed that such tariffs essentially equate to additional taxes, which manufacturers would pass on as increased costs, thus raising the prices of goods. He further noted that if these tariffs were to last for three months, prices of goods could experience a significant surge.
The trade dispute could also potentially lead to a strengthening of the US dollar against the Euro. While this could increase US buyers’ interest in Dutch exports, it also underscores the existing trade imbalances between the two regions. Colijn emphasized that a full-scale trade war would benefit no one.
Reports suggest that the European Commission is preparing retaliatory measures if the US imposes tariffs on European goods. Given the Netherlands’ reliance on international trade, the Dutch government is closely monitoring the situation.
Should President Trump persist in imposing a 25% tariff on European goods, Dutch food exports to the US could see a substantial decrease. A recent economic analysis by the Dutch bank even estimated that Dutch food exports to the US could decline by 50%.
Due to the Netherlands’ heavy dependence on exporting goods to other countries, these tariffs would directly impact industries closely linked to the US, such as machinery and chemicals. The proposed tariffs would specifically affect Dutch exports of beer, spirits, fish, cocoa, and chocolate, industries that heavily rely on the US market. Statistics from the Dutch bank indicate that annual food exports to the US amount to approximately 2.3 billion euros, constituting 3% of the total Dutch food exports.
The Dutch Development Bank predicts that if the tariffs take effect, export product prices in 2025 and 2026 could rise by 0.4%, leading to increased costs for consumers and businesses, potentially undermining purchasing power. Dutch products like beer, spirits, and chocolate hold significant market shares in the US, and the new tariffs would make them less competitive in the American market. Export for brewers and spirit producers could decrease by nearly 10%.
The proposed tariffs could have broader economic repercussions for the Netherlands, potentially slowing economic growth and increasing inflation rates. Economist at the Dutch Development Bank forecasts a 0.2% decrease in the Netherlands’ economic growth rate in 2025, further declining by 0.5% in 2026.
Nevertheless, the Dutch Development Bank anticipates that the Dutch labor market will remain robust, with wage growth projected at 4.8% in 2025 and 4.1% in 2026. Predicted wage growth surpassing inflation indicates that purchasing power for Dutch households may continue to rise.
During President Trump’s first term, the US increased tariffs on 160 global food items, impacting the global economy significantly but having limited effects on the Netherlands. At that time, the focus was primarily on products like wine and olives, which were not major Dutch export products. However, the new proposal of a 25% tariff directly targets the Netherlands’ primary export products.
For the Netherlands, the economic growth prospects for the next two years appear uncertain. Previously, the Dutch Development Bank projected slow economic growth, with an expected GDP growth of 1.7% in 2025 and 1.2% in 2026. However, if the US proceeds with higher tariffs, it could disrupt this growth trajectory.