Major developments in 2023 and 2024
This chapter discusses a number of relevant economic developments that are currently underway. We begin by looking at China. Ever more large firms are considering moving their production or supply lines away from China to nearby countries in Asia. We examine whether these plans are reflected in the economic statistics. In the second section, we focus on products that involve the use of critical raw materials, an area in which China, as a major commodity exporter, again plays a role. The import of products that involve the use of critical raw materials, and the import of critical raw materials themselves, create a complementary picture of other countries’ dependence on natural resources. The third and final section looks at Dutch trade with the United Kingdom in the four years since Brexit. In view of the lack of extensive recent research into the effects of Brexit, it is useful to review developments in trade with the UK once again.
2.1Key findings
Trade in goods with China and other Asian countries
- China is the largest Asian supplier of goods to the Netherlands by far. The importance of China within Dutch trade with South, East and Southeast Asia has not changed dramatically since 2015. Nevertheless, the Chinese share of total Dutch imports of goods has decreased slightly in recent years. This is partly due to lower Chinese export prices in 2023. The value of imports of Chinese phones, computers, office machines and televisions has risen less than that of imports from other countries in South, East and Southeast Asia.
- When it comes to goods exports from the Netherlands, the importance of China has increased in recent years but this is mainly due to one product group: specialised machines and equipment. Without this product group, exports to China would have grown less than exports to other Asian countries in the period 2021–23.
- China is the largest purchaser of Dutch goods bound for South, East and Southeast Asia, but the difference with other countries is smaller than is the case for Dutch imports, and the value of Dutch exports to China is also significantly lower than the value of Dutch imports from China.
- The number of Dutch goods traders who trade with China is much larger than those trading with other countries in the Asian region, and China is also home to the most enterprises that are ultimately controlled in the Netherlands. The number of Dutch goods traders with India and Vietnam grew significantly in the period 2015–2021.
- There are a number of reasons why enterprises make changes with respect to the countries they trade with. This can happen due to geopolitical risks or because of totally unrelated factors such as growing wage differences between China and other Asian countries. It is also possible for trade routes to change without any fundamental changes to the production chain. This research does not provide any insights regarding the specific motives for the changes made by enterprises.
Imports of products containing critical raw materials
- The Netherlands is a major importer of products containing critical and strategic raw materials, but the vast majority of these imports ultimately end up abroad. These are mainly part of the transit trade or re-exports, although a smaller quantity of goods are exported after the raw materials have been processed in the Netherlands. In relative terms, more of the imports of products containing critical raw materials are destined for the Dutch market. Moreover, the import value of products containing critical raw materials is much larger than the import value of critical raw materials.
- Aluminium, nickel, coking coal and copper are mostly imported as raw materials by the Netherlands. Many products containing aluminium, nickel and copper are also imported. This is not the case for coking coal, since this is hardly ever found as an element in other products. Rare earth metals and scandium are, by contrast, hardly ever imported as raw materials but are found in many other products imported by the Netherlands.
- China is the ninth-largest supplier of critical and strategic raw materials to the Netherlands, but is the leading supplier of products containing critical raw materials to the Netherlands.
- Phones, laptops/tablets, medical supplies and solar panels are among the main imported products containing critical raw materials. When it comes to imports from China, laptops/tablets, solar panels and phones predominate.
Trade in goods with the UK four years after Brexit
- The export of goods to the UK has lagged behind exports to other countries since Brexit, primarily due to a drop in re-exports. Additionally, the quasi transit of goods to the UK has declined significantly. Conversely, Dutch re-exports and quasi transit to other countries have seen a substantial increase.
- The value of domestic exports to the UK increased during the period 2015–2023, and also the period 2022–23. This includes products such as food and beverages and mineral fuels. However, in Q1 of 2024, the value of domestic exports fell slightly.
- In terms of exports, since Brexit the balance between re-exports and domestic exports has shifted in favour of the latter.
- Imports from the UK have kept pace reasonably well with imports from other countries, but the import value declined sharply in 2023. This was likely due to a significant fall in the price of mineral fuels.
- British data indicates that UK trade with the Netherlands did not decline more than UK trade with other (EU-)countries.
Outline
The second section of this chapter discusses the development of Dutch goods trade with China and other countries in South, East and Southeast Asia. This is followed, in section 2.3, by a description of the development of Dutch imports of products containing critical and strategic raw materials. Section 2.4 discusses the development of Dutch goods trade with the UK four years after Brexit came into effect.
2.2Goods trade with China and other
Asian countries
China has been an important player in the global economy and international production chains for decades. This is reflected in the statistics for the trade in goods, which is what this section is about. Through the trade in goods, the Netherlands is strongly interwoven with the Chinese economy (Freeman et al., 2022). Increased trade between the Netherlands and China generates various benefits for the Netherlands: access to a bigger market, greater diversity in products, (substantially) lower prices and increased employment. On the export side, the Netherlands also earns money from China, €7.1bn in 2022 or 0.7% of GDP (CBS, 2023a).
However, the increasingly close economic ties between the Netherlands and China are not without risks. We have become more dependent on China. For example, China was responsible for 15% of the import dependence of OECD countries in strategic products in the years 2020 and 2021, whereas the equivalent figure was 4% in the 1997–1999 period. Set against that, China remains more dependent on all the OECD countries combined than vice versa (Arriola et al., 2024). Along with Eastern Europe, Finland and Sweden, the Netherlands is one of the EU countries that is most highly integrated with Chinese production chains (Freeman et al., 2022).
The phenomenon of international companies (partially) withdrawing from China or planning to do so has been dubbed the ‘China-Plus-One strategy’; economies in Southeast Asia are benefiting from this conscious limitation of geopolitical and economic risks by firms (Jongsma & Lalkens, 2024). The decision to move or bring back production may be motivated by a number of reasons, such as rising geopolitical tensions, excessive wage or transport costs, increasing import tariffs due to a trade conflict, power or staff shortages in the proposed production country or fear of logistical disruptions and an excessive dependence on a particular country, as during the COVID-19 pandemic (FD, 2024; Hijink et al., 2022).
Relocation of production was also seen before the pandemic, for example in 2019 with the onset of new tensions between the US and China and previously also due to rising wages in China. Firms that use China as a production hub will be more inclined to shift their activities than those that maintain a presence there for access to China’s large consumer market (Middeldorp, 2019). A CBS study in 2022 showed that India was more popular than China in terms of outsourcing business entities from the Netherlands. The difference was seen primarily in services, such as ICT services. But India was also a more popular country for manufacturing goods and materials (CBS, 2022). More recently, in late 2023, the European Central Bank surveyed 65 large multinationals on this issue. 40% of those firms sourced critical production from China and two-thirds cited China as a risk in terms of future security of supply. Nearly 40% were considering shifting production from the current country of origin – often China – to other countries outside the EU (Grazia Attinasi, 2023).
In this section, we explore whether there is a difference in the development of the Netherlands’ trade in goods with China and its trade in goods with other Asian trading partners.noot1 We also look at the number of firms in the Netherlands that trade with Asian trading partners and the number of subsidiaries of Dutch-owned multinationals in Asia. The most comprehensive and recent information is available for the Dutch goods trade with Asian countries, and for this reason this makes up the core of this section.
Slight fall in Chinese share of the value of Dutch goods imports
In the 2015–2023 period, Dutch goods imports from East and South Asia grew roughly as quickly as total Dutch goods imports, resulting in a stable market share. Specifically for China, the share in 2023 was also the same as in 2015 (over 8%); however, in 2020, 2021 and 2022, China had a slightly larger share (9 to 10%). This is partly explained by lower Chinese export prices in 2023. Chinese export goods such as telephones, laptops and solar panels are being offered more cheaply in an attempt to keep the export engine running during a period of reduced domestic demand in China (Nieuwsuur, 2024). The share of Dutch goods imports of the other 26 countries in South and East Asia combined has remained stable since 2015 (10 to 11%).
In the first quarter of 2024, the fall in the Chinese share of total Dutch imports continued, with a reduction from an 8.3% market share (first quarter 2023) to 7.6%. At the same time, the share of the other Asian countries in the first quarter increased from 9.9% to 10.8% because the import value from this region fell by less in relative terms, year on year. The value of imports from China declined by 21% in comparison with the first quarter of 2023, while the value of imports from other countries fell by 5%. In the case of China, roughly half of this significant decrease in import value was caused by lower prices and the other half by lower volume, for example because fewer solar panels were imported. Alongside China, imports from Japan, Singapore, Malaysia and South Korea also fell sharply in absolute terms. Set against that, imports from Taiwan and Thailand increased significantly in the first quarter of 2024, relative to the same period in 2023.
| jaar | China | Other countries |
|---|---|---|
| 2015 | 8.2 | 10.4 |
| 2016 | 8.3 | 10.9 |
| 2017 | 8.4 | 10.7 |
| 2018 | 8.3 | 10.3 |
| 2019 | 8.7 | 10.7 |
| 2020 | 9.8 | 11.1 |
| 2021 | 9.3 | 10.1 |
| 2022 | 9.5 | 10.2 |
| 2023 | 8.4 | 10.1 |
China is the most important supplier of imports in South and East Asia by some distance
In 2023, the Netherlands imported €51bn worth of goods from China (excluding quasi-transit trade), which is far more than from all the other individual countries or territories in South and East Asia, combined. China was followed at some distance by Japan, Vietnam, Taiwan, India and Malaysia as the most important suppliers to the Netherlands. The top 10 was completed by Hong Kong, South Korea, Singapore and Thailand. The top 10 partners together accounted for 92% of total imports from South and East Asia.
Since 2015, the value of Dutch imports from Taiwan, India, South Korea, Singapore and Vietnam have grown faster in percentage terms than imports from China. Looking only at the most recent yearsnoot2 (2021–2023), however, two countries really stand out: India (+55%) and Vietnam (+53%). China is lagging behind, with a growth rate of 12%. Between 2022 and 2023, the value of imports from China actually fell, for the first time in seven years. This was partly due to cheaper products from China, as noted previously. Countries such as Vietnam and Malaysia are cited by experts as attractive alternatives to China with an adequate supply of labour, low wages, a technology focus and good education. India in particular boasts a large and growing labour potential (Jongsma & Lalkens, 2024).
| land | 2023 | 2022 | 2021 | 2015 |
|---|---|---|---|---|
| China | 51.5 | 64.2 | 46.0 | 29.1 |
| Japan | 8.6 | 9.0 | 7.4 | 6.9 |
| Vietnam | 7.7 | 7.2 | 5.0 | 4.1 |
| Taiwan | 7.3 | 7.1 | 5.8 | 2.5 |
| India | 6.1 | 6.8 | 3.9 | 2.6 |
| Malaysia | 5.3 | 6.1 | 4.3 | 5.6 |
| Hong Kong | 5.2 | 6.2 | 4.7 | 3.4 |
| South Korea | 4.9 | 6.4 | 4.5 | 2.3 |
| Singapore | 4.5 | 5.1 | 3.7 | 2.4 |
| Thailand | 3.8 | 4.0 | 3.3 | 2.2 |
Net shift in imports of telephones, computers, office machines and TVs
What do we see at product level? For the most common goods imported by the Netherlands from the entire region, we see a mixed picture characterised by a diminishing significance for China overall. Figure 2.2.3 shows the change in the value of imports from China minus the change in the value of imports from the other Asian countries. In the 2021–2023 period, the import value of telephones from China grew less rapidly than from the other countries. The same was true for computers, refined petroleum products, office machines, televisions, household appliances and shoes. This is subject to the previously mentioned caveat that the differences are partly explained by a fall in export prices in the Chinese manufacturing industry and that it does not necessarily say anything about a shift in import volumes. An analysis of CBS figures shows that Chinese export prices were lower in every quarter of 2023 than in the same quarters of 2022. This applies to manufactured, chemical and other products. The decrease in prices for products from China was greater (–8.8%) than the overall fall in prices for imported goods in 2023 (–5.5%, see Chapter 3).
Between 2021 and 2023, the import value of telephones from Taiwan, Hong Kong and Vietnam increased substantially and the same was true for computers, office machines and televisions from Vietnam and refined petroleum products from India, Malaysia and Singapore. We also see a striking increase in semi-conductor components and household appliances from the Philippines. Specifically in the 2022–2023 period, the import value of computers, laptops and tablets from Taiwan tripled, while for China it fell by 30%. This appears to reflect an import shift from China to Taiwan (CBS, 2024a).
On the other hand, there are also important categories of imported goods for which imports from China grew faster between 2021 and 2023 than imports from the other 26 Asian countries combined. This applies in particular to semi-conductor components, electrical appliances and devices and electrical power tools, and to a lesser extent also to toys and sports goods. For the period 2022–2023, the rapid growth in imports of electric cars from China stands out. The import value of these goods increased thirteen-fold in the space of a year (CBS, 2024b).
| goederen | Net change in imports from China |
|---|---|
| Telephone handsets | -2.64 |
| Computers | -1.06 |
| Semi-conductor components |
0.78 |
| Petroleum products | -0.41 |
| Electrical devices and equipment |
0.68 |
| Office equipment | -0.55 |
| Electric power tools | 0.60 |
| Toys and sports goods |
0.15 |
| Televisions | -0.68 |
| Baby clothes | -0.10 |
| Domestic appliances |
-0.40 |
| Shoes | -0.26 |
| Note: Relates to the absolute change in the import value of goods from China between 2023 and 2021, minus the absolute change in the import value of goods from the other 26 countries. A positive value indicates a net shift towards imports from China and a negative value indicates a net shift towards imports from the other 26 countries. | |
Chinese share of Dutch goods exports increases slightly
Dutch goods exports to Asia are much smaller than imports from Asia. As with imports, we see a stable picture when it comes to Asia’s share of the total Dutch goods trade. The Chinese share did grow slightly, to 2.6% in 2023, compared both to 2015 and to more recent years. It is, however, slightly lower than in the peak year of 2020 (3.0%). The sum of exports to all other South and East Asian countries in 2023 was more than double the exports to China, but in fact the trend over recent years has been slightly downwards. At 5.6%, the share was the same as in 2015.
| jaar | China | Other countries |
|---|---|---|
| 2015 | 2.0 | 5.6 |
| 2016 | 2.3 | 5.8 |
| 2017 | 2.4 | 6.3 |
| 2018 | 2.3 | 6.2 |
| 2019 | 2.4 | 6.1 |
| 2020 | 2.9 | 6.3 |
| 2021 | 2.4 | 6.3 |
| 2022 | 2.0 | 5.7 |
| 2023 | 2.6 | 5.6 |
Top ten export destinations closer to China than top ten suppliers of imports
In 2023, the Netherlands exported €18bn worth of goods to China (excluding quasi-transit trade), making it the most important export destination in South and East Asia. The differences between China and the other countries are, however, smaller than we saw previously for imports. China is followed by South Korea (€10bn), Taiwan (€8bn) and Japan (€5bn). The top ten is completed by Singapore, India, Hong Kong, Vietnam, Indonesia and Thailand. Those ten destinations taken together accounted for 95% of total Dutch exports to South and East Asia.
Of the ten countries listed, the value of Dutch exports has grown the fastest with respect to Taiwan, South Korea and China since 2015, in percentage terms. If we look at a more recent period (2021–2023), alongside China there are two other countries which are growing rapidly as export markets: Vietnam and Indonesia. The Netherlands invests €1.5bn in Indonesia annually, making it the most important investor in that country. It is a large market with a population of 270 million. Along with Vietnam, Thailand, Singapore and Malaysia, Indonesia is one of the five priority Asian trading partners for the Dutch government (Government of the Netherlands, 2022).
Economic growth figures of 4 to 5% for the region as a whole in 2023 were still above the global average, but they were nevertheless low for the region compared to previous years. The World Bank highlights low investment in infrastructure and real estate, low consumption in China, increasing debt for households, firms and governments and sluggish productivity growth throughout the region (World Bank, 2024). These developments may impede the further growth of Dutch exports to these countries.
| land | 2023 | 2022 | 2021 | 2015 |
|---|---|---|---|---|
| China | 18.1123 | 14.6791 | 13.2075 | 8.1824 |
| South Korea | 10.1675 | 9.3195 | 8.5145 | 4.0677 |
| Taiwan | 7.9876 | 11.2939 | 9.6493 | 2.6823 |
| Japan | 5.0949 | 5.2203 | 4.2504 | 3.4585 |
| Singapore | 3.4084 | 3.4773 | 3.0575 | 3.9646 |
| India | 2.7803 | 3.2646 | 2.3043 | 1.8163 |
| Hong Kong | 1.976 | 1.9287 | 1.7805 | 2.1377 |
| Vietnam | 1.3075 | 1.1665 | 0.9058 | 0.7436 |
| Indonesia | 1.2936 | 0.9856 | 0.8631 | 0.7027 |
| Thailand | 1.2575 | 1.2787 | 1.011 | 1.0164 |
Higher growth outside China when machinery and equipment exports are excluded
The increased absolute growth shown previously in the value of goods exported to China in the 2021–2023 period, compared with exports to the other Asian trading partners, is explainable. It was entirely due to the stronger growth in exports of machinery and equipment to China in that period, made up almost entirely of specialised machinery such as chip-making equipment.
Without the machinery and equipment product category, there was actually a net shift in exports to the other 26 countries in South and East Asia. The biggest net shift was in industrial products (manufactured goods), followed by transport equipment, raw materials and natural products and chemical products. Examples of strong growth in exports outside China were medical instruments and appliances to Indonesia, aircraft (or aircraft components) to Vietnam and medicaments and pharmaceutical products to South Korea and Japan.
| categorie | Net change in exports to China |
|---|---|
| Total excl. machinery and equipment |
-2.33 |
| Total | 1.758 |
| . | |
| Machinery and equipment | 4.087 |
| Mineral fuels | 0.163 |
| Food and beverages | -0.073 |
| Chemical products | -0.39 |
| Raw materials and natural products |
-0.477 |
| Transport equipment | -0.591 |
| Manufactured goods | -0.961 |
| Note: Relates to the absolute change in the export value of goods to China between 2023 and 2021, minus the absolute change in the export value of goods to the other 26 countries. A positive value indicates a net shift towards exports to China and a negative value indicates a net shift towards exports to the other 26 countries. | |
Vast majority of firms trading with China, strong growth for India and Vietnam
For the 2015–2021 period, a good comparison can also be made of the number of importers and exporters with trading partners in Asia. This provides an indication of willingness to trade with particular countries. Data is also available for 2022, but unfortunately due to method breaks it is not readily comparable with previous years. With nearly 22,000 Dutch enterprises importing from China and nearly 5,000 exporters, China was the Asian trading partner with which the largest number of Dutch firms were trading in 2021, followed at some distance by India, Japan, Taiwan and South Korea. Over the 2015–2021 period, only the number of importers of goods from Vietnam and India grew faster in percentage terms than the number of importers with links to China (+11%). On the export side, the number of exports grew for all the main trading partners. For five destinations, the greatest growth in the number of exporters was slightly higher than for China (+17%); they were Taiwan, Japan, India, South Korea and Vietnam.
| land | Importers | Exporters |
|---|---|---|
| China | 11.4 | 17.1 |
| India | 15.5 | 22.2 |
| Japan | 2.6 | 23.7 |
| Taiwan | -9.8 | 27.5 |
| South Korea | 5.7 | 20.6 |
| Singapore | 1.7 | 8.7 |
| Malaysia | -2.6 | 5.1 |
| Thailand | -15.3 | 4.8 |
| Vietnam | 23.0 | 18.3 |
| Indonesia | -4.4 | 2.5 |
| Note: Only includes importers and exporters with an import or export value of at least 5,000 euro. | ||
Foreign subsidiaries under Dutch control also primarily located in China
Statistics Netherlands’ Outward Foreign Affiliate Statistics (OFATS) reveal the number of foreign subsidiaries under Dutch control. Directly comparable data is only available for the years 2021 and 2022. In 2022, almost half of the foreign subsidiaries of Dutch-owned multinationals in South and East Asia were located in China. Between 2021 and 2022, the number of firms in China remained virtually the same, but we do observe a fall of 8% in the number of firms in the other countries. The greatest percentage growth is seen in Taiwan, Bangladesh and Myanmar, but the numbers involved are small. No data is available for Vietnam.
| land | 2022 | 2021 |
|---|---|---|
| China | 688 | 681 |
| India | 225 | 249 |
| Malaysia | 155 | 179 |
| Indonesia | 98 | 128 |
| Thailand | 75 | 84 |
| Taiwan | 71 | 51 |
| Bangladesh | 23 | 10 |
| Myanmar | 20 | 9 |
| Sri Lanka | 12 | 23 |
| Cambodia | 9 | 7 |
| Macau | 4 | 6 |
| Brunei | 1 | 6 |
2.3Imports of products containing critical raw materials
Critical and strategic raw materials (see inset) are increasingly in the spotlight worldwide. This is because they are essential for the functioning of our economy and our society. They are important in the context of the green and digital ambitions of the Netherlands and Europe and also for important sectors such as healthcare and defence. Greater dependence on countries outside Europe, such as China, for critical raw materials makes us vulnerable. A supplier could, for instance, abuse its position of power in a raw material supply chain in order to pressurise other countries economically (Government of the Netherlands, 2023).
Critical and strategic raw materials
Based on the current list maintained by the European Commission, there are 34 critical and/or strategic raw materials, with 17 being critical/non-strategic, 15 critical/strategic and two non-critical/strategic (copper and nickel). Critical raw materials have a major economic impact and are associated with a high supply risk and few substitution options. Strategic raw materials are also crucial to our green and digital ambitions and for sectors such as aerospace and defence (European Commission, 2023a). For the sake of readability, the entire group will here be referred to as ‘critical raw materials’.
In March 2024, the Council of the EU adopted a European regulation to reduce dependence on third countries for critical raw materials; the goal is that by 2030, at least 10% of the EU’s annual consumption will be extracted within the union, at least 40% processed within the EU, at least 25% obtained from recycled materials and no more than 65% will come from a third country at any particular stage of processing (Council of the EU, 2024). Alongside security of supply, Europe’s green agenda is also linked to these objectives. For instance, the EU wants to be fully circular and climate neutral by 2050. The latter requires technology such as wind turbines, solar panels and electric cars, and their production is dependent on critical raw materials (CBS, 2024c). Furthermore, there are concerns about the impact of mining outside Europe, for our consumption, on people, the climate, nature and the environment. There are Congolese cobalt mines, for instance, where whole families work for low wages and are exposed to severe health risks to extract cobalt for mobile phone batteries and similar products (Delbert, 2023).
Rich countries bear an additional responsibility when it comes to the use of raw materials. They consume six times as many raw materials as poor countries and their impact on the climate is as much as ten times higher, far more than the earth can cope with (United Nations, 2024). The European Environment Agency emphasises the importance of circularity – making products that last longer and making reuse, recycling and recovery more commercially attractive – an equitable transition and a reduction in demand for raw materials (EEA, 2024). For more information about the footprint of Dutch imports, see Chapter 8 of this publication.
Broadly speaking, critical raw materials can enter our country in two ways. On the one hand, they can arrive unprocessed or barely processed for further processing in the Netherlands or other European countries. On the other hand, they can enter the Netherlands as part of semi-manufactured goods or end products. In 2023, over €17bn worth of unprocessed or barely processed critical or strategic raw materials was importednoot3, which is almost a quadrupling compared to 20 years previously. However, the lion’s share of that was accounted for by price rises, in view of the more limited growth in import weight of approximately 20%. When we look at products containing critical raw materials, the value is much higher than for unprocessed critical raw materials, because here the entire product value counts. In 2023, products worth a full €322bn were imported, which was three times more than in 2003. Here, too, import weight had increased by approximately 20% since 2003. However, underlying these figures there are major shifts, with older technologies slowly being phased out, for example petrol cars, and relatively new technologies advancing quickly, such as electric cars.
Between 2018 and 2022, the value of Dutch solar panel imports grew nearly five-fold and in 2022, the Netherlands was actually the most important importer of solar panels in the world, with the qualification that the majority of those products were re-exported (CBS, 2023b). In addition, the Netherlands is also importing ever more multifunctional technology for the energy transition, such as switchboards, automatic controllers and heat exchangers (CBS, 2024c).
Rare earth metals often imported in product form
Table 2.3.1 compares imports of critical and strategic raw materials (left) with imports of products containing critical and strategic raw materials (right). On the raw materials side, aluminium, nickel, coking coal and copper are by far the biggest imports in terms of value. They account for 87% of the total import value of critical and strategic raw materials. On the product side, aluminium, copper and nickel are also high up on the list, because they are contained in many products. Coking coal, on the other hand, is completely absent, because it barely features as a constituent of other goods but is used virtually exclusively as a raw material, primarily as fuel for smelting metals in blast furnaces.
Rare earth metalsnoot4, scandium, magnesium, antimony and platinum group metals are in fact commonly imported in product form and seldom in an unprocessed form. For instance, the rare earth metal neodymium is important for magnets in computers, electric cars and wind turbines. China accounts for 93% of the production of permanent magnets made of rare earth metals (European Commission, 2022). The US and Europe are therefore both actively seeking to reduce their dependence on Chinese rare earth metals. In the US, it was recently discovered that they can be extracted relatively easily from existing coal mines in Utah and Colorado (Schonebeek, 2024). The biggest stocks of rare earth metals in Europe were discovered only recently in Norway, but extraction cannot begin until 2030 and will involve nearly €1bn in initial investment (De Maeseneer, 2024).
| Raw materials | Products | ||||||
|---|---|---|---|---|---|---|---|
| incl. quasi-transit trade | excl. quasi-transit trade | incl. quasi-transit trade | excl. quasi-transit trade | ||||
| bn euros in value of raw material | bn euros product value | ||||||
| Aluminium | 7.3 | Aluminium | 3.2 | Aluminium | 235.9 | Aluminium | 176.6 |
| Nickel | 2.9 | Nickel | 1.3 | Copper | 219.5 | Copper | 165.1 |
| Coking coal | 2.8 | Coking coal | 1.0 | Rare earth metals | 110.7 | Rare earth metals | 74.0 |
| Copper | 1.2 | Copper | 0.6 | Scandium | 95.5 | Scandium | 63.1 |
| Manganese | 0.6 | Manganese | 0.3 | Nickel | 74.7 | Nickel | 56.7 |
| Niobium | 0.5 | Lithium | 0.2 | Platinum group metals | 67.9 | Magnesium | 49.9 |
| Silicon | 0.3 | Phosphorite | 0.1 | Antimony | 67.8 | Antimony | 47.7 |
| Lithium | 0.3 | Cobalt | 0.1 | Magnesium | 65.2 | Cobalt | 47.0 |
| Magnesium | 0.2 | Borate | 0.1 | Cobalt | 62.7 | Lithium | 41.8 |
| Cobalt | 0.2 | Titanium | 0.1 | Tantalum | 61.3 | Platinum group metals | 41.6 |
Source:CBS, partly based on TNO’s Raw Materials Scanner
Note: Products often contain multiple critical raw materials, so multiple raw materials are assigned an import value simultaneously. The whole product value is used here. The Commodity Scanner was used; this indicates which products contain critical raw materials (the exact amount does not matter). See Bohn et al. (2023).
China top supplier of products containing critical raw materials
The dominance of aluminium, coking coal, copper and nickel in Dutch imports (by value), as noted previously, is also reflected in the list of the main suppliers of raw materials. In 2023, the ten biggest suppliers of critical and strategic raw materials (in raw material form) to the Netherlands were Norway, Iceland (primarily aluminium), Australia, the US (primarily coking coal), Russia (primarily nickel), Canada, South Africa (nickel, aluminium), Chile (copper, aluminium), China (many varietiesnoot5) and Brazil (niobium). In the first quarter of 2024, we see the same countries on the list, but China is slightly higher in the ranking (moving up from nine to seven).
The list is very different if we look at the main suppliers of products containing critical raw materials, see Figure 2.3.2. Now China is not no longer the ninth-ranked supplier but the first. This is not surprising because China is dominant in many raw materials at multiple stages of processing, from mining to the processing of raw materials from China or from other countries, as well as in manufacturing end products. China is a major manufacturer of end products containing critical raw materials, such as solar panels, laptops and telephones. It should be noted that more than half of Dutch imports from China comprise direct transit trade in foreign ownership. On the other hand, China also supplies goods to the Netherlands indirectly. For instance, Germany is the second-largest supplier of products containing critical raw materials to the Netherlands (and the first excluding transit trade), such as machinery and cars, but these also incorporate Chinese critical raw materials. As such, the dependence on China is even greater than Figure 2.3.2 shows.
In the first quarter of 2024, however, China’s leading position as the largest supplier of products involving the use of critical raw materials over Germany declined sharply and is now minimal. This is partly due to a sharp decline in the import value of Chinese solar panels, which, in turn, is related to lower prices, large (strategic) stocks in Europe (Rystad, 2023) and falling demand (Duintjer Tebbens, 2023). We also see a decrease in the import value of telephones and laptops/tablets from China, which is linked to lower import prices.
| land | Re-exports | Other imports |
|---|---|---|
| China | 32.6 | 30.6 |
| Germany | 4.4 | 46.3 |
| US | 6.0 | 25.7 |
| Belgium | 0.6 | 19.7 |
| UK | 1.9 | 10.8 |
| Taiwan | 5.5 | 5.7 |
| Japan | 3.1 | 6.5 |
| France | 0.8 | 7.3 |
| Ireland | 1.2 | 6.5 |
| Poland | 1.6 | 5.9 |
| * provisional figures | ||
Cars and high-tech and healthcare products most likely to contain critical raw materials
Telephones, medicines, laptops/tablets, medical appliances and solar panels head the list of imported products containing critical raw materials. However, much of that is transit trade in foreign ownership. Without that import stream, telephones and medicines do remain at the top of the list, but laptops and tablets drop well down the ranking (from three to nine) and the same applies to solar panels (from five to twelve). Without transit trade, cars are in fourth position, components for specialised machinery (such as chip-making equipment) in fifth and car parts in sixth. There are four product categories that had a lot of imports in 2023 but hardly any or none at all in 2003, namely telephones, components for specialised machinery, artificial joints and solar panels. The leading products which the Netherlands obtains from China are laptops/tablets, solar panels and telephones.
| 2003 | 2023* | |
|---|---|---|
| bn euros product value | ||
| Including quasi-transit trade trade | ||
| Telephones | 0.0 | 20.4 |
| Medicines | 4.5 | 16.8 |
| Laptops, tablets | 2.5 | 16.3 |
| Syringes, needles, catheters, etc. | 2.6 | 11.8 |
| Solar panels | 0.2 | 10.7 |
| Computer components | 2.5 | 8.7 |
| Lighting ballasts | 1.0 | 7.8 |
| Passenger vehicles | 5.5 | 7.3 |
| Passenger vehicle parts | 2.0 | 6.8 |
| Specialist machine parts | 0.0 | 6.1 |
| Prosthetic joints | 0.4 | 6.0 |
| Computers | 1.8 | 4.8 |
| Excluding quasi-transit trade | ||
| Telephones | 0.0 | 14.7 |
| Medicines | 3.9 | 12.5 |
| Syringes, needles, catheters, etc. | 2.2 | 10.5 |
| Passenger vehicles | 4.5 | 6.1 |
| Specialist machine parts | 0.0 | 6.0 |
| Passenger vehicle parts | 1.9 | 5.7 |
| Lighting ballasts | 0.8 | 5.2 |
| Prosthetic joints | 0.3 | 5.0 |
| Laptops, tablets | 2.1 | 4.7 |
| Computers | 2.2 | 3.7 |
| Pacemakers, hearing aids | 1.1 | 3.5 |
| Solar panels | 0.1 | 3.5 |
Source:CBS, partly based on TNO’s Raw Materials Scanner
2.4Goods trade with the UK four years after Brexit
At the stroke of midnight on 31 January 2020, the UK left the European Union – a unique situation, because it was the first time in the history of the EU that a member state had left voluntarily. The desire for ‘(Br)exit’ was a result of an advisory referendum among the UK population in 2016. Following a year-long transitional period, a new Trade and Cooperation Agreement (TCA) came into force on 1 January 2021. We are now more than four years on. What have the consequences of Brexit been for UK-Netherlands trade? This is not an easy question to answer, because this has also been a turbulent period in other areas that have also impacted trade. For instance, the COVID-19 pandemic and the war between Russia and Ukraine. In order to obtain a picture of the impact of Brexit, we will present data on trade with all countries over recent years, in addition to changes in trade with the UK. The latest trade figures for the first quarter of 2024 are also presented here.
Exports fell after Brexit, but the UK remains an important trading partner
The UK is an important trading partner for the Netherlands, both for imports and exports. In the years before Brexit, from 2015 to 2019, the UK was our third most important export partner. In 2020, the year of Brexit, the UK dropped to fourth position while France rose to third place. That remained the same until 2023. In that year, 6% of total exports by value crossed the North Sea. In previous years, the figure had been 8 to 9%. Of all the goods the Netherlands imported in 2023, 5% came from the UK, making the UK the Netherlands’ fifth most important import partner. The position and the percentage have been fairly stable since 2015.
So it is the export of goods to the UK in particular that seems to have changed in the years since Brexit. Figure 2.4.1 below summarises the results that we will delve into in greater detail in the following sections. It shows that re-exports and particularly the transit trade in goods to the UK have fallen since 2020, the year of Brexit. Meanwhile, re-exports and transit trade to all countries have actually grown substantially. Domestic goods exports to the UK have risen, but the increase is significantly less than the increase to all countries.
No decline in domestic exports to the UK
In 2015, the year before the referendum, domestic exports worth €18.9bn went from the Netherlands to the UK. A quarter of those were food and beverages, followed by chemical products and manufactured goods. Following a dip in 2020, the export value rose again, to €26.1bn in 2023. Relative to 2015, that was a rise of 38%. By way of comparison, the export value of domestic goods exports to all countries rose by 57% in the same period; see also Figure 2.4.1. In 2015, 9% of domestic goods exports went to the UK; in 2023, the figure was 8%. The UK therefore appears to have become slightly less important as a market.
In the most recent year for which we have figures, from 2022 to 2023, the export value of domestic goods exports to the UK rose by approximately 1%. Exports to all countries fell by 5%. The latter can be explained by the fact that 2022 was a year in which, partly due to a sharp increase in inflation, trade values rose significantly, whereas in 2023 the situation normalised somewhat because prices fell. In particular, the fall in prices for mineral fuels and chemical products caused a drop in the absolute value of goods exports in 2023. With regard to exports to the UK, the value of food products, mineral fuels and machinery did still increase compared to the previous year, meaning that the total export value of domestic goods to the UK remained slightly positive. However, exports in the other product categories fell in value in 2023.
Looking at exports per quarter, we see that the value of domestic goods exports to the UK in the first quarter of 2024 was 4% lower than in the fourth quarter of 2023. Compared to the first quarter of 2023, it was 5% lower.
Export value of mineral fuels more than doubled
In 2023, food and beverages still made up the largest share of domestic goods exports. They were followed by mineral fuels and chemical products. The value of domestic exports of mineral fuels more than doubled between 2015 and 2023. This was due mainly to price rises and not so much to an increase in volume (also see Chapter 6 on export earnings). The value of machinery and equipment also rose significantly.
| Productgroep | 2023* | 2022 | 2015 |
|---|---|---|---|
| Food and beverages | 5.7 | 5.2 | 4.7 |
| Mineral fuels | 5.1 | 4.9 | 2.2 |
| Chemical products | 4.2 | 5.0 | 3.5 |
| Machinery and equipment | 3.9 | 3.4 | 2.0 |
| Manufactured goods | 3.7 | 3.8 | 3.4 |
| Raw materials and natural products | 1.9 | 2.1 | 1.4 |
| Transport equipment | 1.4 | 1.5 | 1.5 |
In Figure 2.4.3. we examine the category of domestic goods exports to the UK in slightly more detail; the top 15 product categories are shown here. Refined petroleum products are firmly in first place, followed by flowers and plants, and by vegetables and root vegetables in third place. These were also the three most important product categories in 2015. Computers, laptops and tablets, and telephones, modems and routers were not yet in the top 15 in 2015. On the other hand, a relatively large amount of natural gas was exported in 2015, whereas this had dropped out of the top 15 by 2023.
| productgroep | 2023 | 2015 |
|---|---|---|
| Refined petroleum products |
3.9 | 1.1 |
| Flowers and plants |
1.3 | 1.0 |
| Vegetables and root vegetables, fresh, chilled, frozen |
0.9 | 0.8 |
| Other meat and edible offal |
0.7 | 0.7 |
| Computers, laptops, tablets |
0.7 | 0.2 |
| Medicines | 0.7 | 0.5 |
| Vegetables and root vegetables, prepared or preserved |
0.6 | 0.3 |
| Electrical energy | 0.6 | 0.4 |
| Mineral oil residues |
0.5 | 0.1 |
| Prepared food products | 0.5 | 0.4 |
| Other passenger vehicles |
0.5 | 0.5 |
| (Mobile) telephones, modems, routers, etc |
0.4 | 0.2 |
| Medicaments and pharmaceutical products |
0.4 | 0.1 |
| Other chemical products | 0.4 | 0.3 |
| Meat, edible offal, not fresh |
0.4 | 0.3 |
Earnings from exports of Dutch products are substantially higher than, for example, earnings from re-exports or quasi-transit trade (also see Chapter 6 of this publication). The fact that domestic exports to the UK appear to be suffering somewhat less from Brexit than re-exports and transit trade is therefore a positive finding. However, this may be a temporary stay of execution there was an extended exemption period for agricultural products (an important export category for the Netherlands), but this came to an end this year. As of 30 April 2024, UK customs began physically inspecting incoming animal products, plants and plant-based products from the EU at Border Control Posts. This will entail increased waiting times and possibly additional costs (FD, 2024), which may be visible in the figures for Q2 2024. At the time of writing this document, those figures were not yet available.
Impact of Brexit primarily felt in re-exports and transit trade
Re-exports are imported foreign goods which, after being imported into the Netherlands, (temporarily) become the property of a Dutch company but undergo little or no processing and are then exported again, in this case to the UK. Figure 2.4.1 shows that following a number of years of steady increases, in the Brexit year of 2020, re-exports fell to 3% below the figure for 2015, and were still at that level in 2023. Re-exports to the UK totalled €17.0bn in 2023. Of course 2020 was also the year in which the world experienced the COVID-19 pandemic, which significantly disrupted trade. However, re-exports to all countries grew in value substantially after 2020 (by 83%). Re-exports to the UK have therefore been lagging well behind by comparison. In 2023, 5% of all re-exports from the Netherlands went to the UK. In 2015, the equivalent figure was 10%.
From 2022 to 2023, re-exports to the UK fell by 2 percentage points, while re-exports to all countries fell by 7%. Looking at exports per quarter, we see that the value of re-exports to the UK in the first quarter of 2024 was 1% lower than in the fourth quarter of 2023. Compared to a year before (first quarter of 2023), it was 2% lower.
Re-exports of mobile telephones and laptops still number 1, but share is falling
The biggest category within re-exports to the UK consists of machinery and equipment. For instance, (mobile) telephones, computers and laptops, but also medical appliances and office machines. In 2015, 43% of the goods fell into this category, with a value of €7.6bn. In 2023, the equivalent share and value fell to 36% and €6.1bn, respectively. This is still the biggest category (in value), followed by manufactured goods and chemical products. Compared to 2015, 2.5 times as much foreign transport equipment was exported in 2023.
| categorie | 2023 | 2022 | 2015 |
|---|---|---|---|
| Machinery and equipment | 6.1 | 6.1 | 7.6 |
| Manufactured goods | 5.0 | 5.4 | 4.5 |
| Chemical products | 2.1 | 2.3 | 2.4 |
| Food and beverages | 1.3 | 1.4 | 1.6 |
| Transport equipment | 1.0 | 0.8 | 0.3 |
| Mineral fuels | 0.9 | 1.0 | 0.9 |
| Raw materials and natural products |
0.5 | 0.4 | 0.3 |
Looking in slightly more detail at which product categories in particular were re-exported, Figure 2.4.5 shows that the biggest one was telecommunication equipment, i.e. (mobile) telephones, modems and routers. However, its value has nearly halved since 2015. It may be that these devices are now being exported directly to the UK from countries such as China or nearby Asian countries (see section 2.2). Relatively large quantities of medical instruments and appliances are also re-exported to the UK from the Netherlands, as are other manufactured articles.
| categorie | 2023* | 2015 |
|---|---|---|
| (Mobile) telephones, modems, routers |
1.7 | 3 |
| Medical instruments and devices |
1.2 | 1.2 |
| Manufactured goods |
0.9 | 0.9 |
| Refined petroleum products |
0.8 | 0.8 |
| Computers, laptops, tablets |
0.7 | 0.6 |
| Office equipment | 0.5 | 0.5 |
| Turbine or jet engines, propeller turbines |
0.5 | 0.5 |
| Medicines | 0.5 | 0.4 |
| Medicaments and pharmaceutical products |
0.4 | 0.4 |
| Passenger cars | 0.4 | 0.3 |
| Other chemical products |
0.4 | 0.3 |
| Instruments for measurement, control and analysis |
0.4 | 0.3 |
| Televisions | 0.3 | 0.3 |
| Aircraft and spacecraft |
0.3 | 0.3 |
| Machinery for mining and excavation |
0.3 | 0.3 |
Quasi-transit trade to the UK halves after Brexit
Like re-exports, the quasi-transit trade in goods from the Netherlands to the UK was dealt a substantial blow by Brexit. Quasi-transit trade is the import of foreign goods which, in contrast to re-exports, remain in the ownership of a foreign enterprise for the entire time they are in the Netherlands. Quasi-transit trade to the UK fell sharply in recent years, whereas it grew strongly in value to all destinations. See also Figure 2.4.1. In 2022, the transit trade value of goods destined for the UK was worth only slightly more than half (52%) of what it had been in 2015. In 2023, it fell slightly further, to less than half the level of 2015 (45%), or €5.1bn. In the same period between 2015 and 2023, quasi-transit trade to all countries actually increased by 65%. Of total quasi-transit trade from the Netherlands in 2015, 10% was destined for the UK. In 2023, the figure was only 3%.
The fact that exports of originally foreign products (re-exports and quasi-transit trade) in particular, were affected by Brexit is easily explained. The trade treaty between the UK and Europe is based on unrestricted trade without tariffs and quotas, but that only applies to goods whose origins lie within the countries that are party to that trade treaty (Franssen & Rooyakkers, 2021). Franssen et al. (2020) showed that in 2017, on average, 53% of re-exports from the Netherlands to the UK originated from non-EU countries, particularly China and the US. Those goods are probably still subject to import tariffs. It is therefore more attractive for UK companies to import goods directly without a stopover in the Netherlands.
Total exports fall behind and ratio shifts
If we now look at total goods exports to the UK, i.e. domestic goods exports plus re-exports (not including transit trade), in Figure 2.4.6 we see a steady growth from €36.5bn in 2015, the year before the referendum, to €43.1bn in 2023. That seems positive, but if we compare exports to the UK with exports to all countries, we notice that exports to the UK have lagged behind. Export value in particular rose a lot less strongly between 2020 and 2022. This is almost entirely attributable to depressed re-exports, as we saw in the previous sections. From 2022 to 2023, total exports to the UK fell by 0.5%, and in the first quarter of 2024, the export value was also lower than the quarter before (–2%) and the first quarter of 2024 (–3%). This means that the fall between 2022 to 2023 was less steep than exports to all countries (–6%).
Exports to Northern Ireland – part of the UK but still within the European Union for customs purposes – rose strongly between 2022 and 2023, by 24%. This may have slightly tempered the fall in exports to the UK overall, but in view of the fact that the Northern Irish economy is far smaller than the British economy, this effect is negligible. If we do not include Northern Ireland in the calculation, exports fell not by 0.5% but by 0.8%.
| jaar | Exports to the UK | Exports to all countries |
|---|---|---|
| 2015 | 100 | 100 |
| 2016 | 106 | 101 |
| 2017 | 108 | 111 |
| 2018 | 110 | 118 |
| 2019 | 109 | 122 |
| 2020 | 96 | 113 |
| 2021 | 100 | 138 |
| 2022 | 119 | 180 |
| 2023 | 118 | 169 |
As well as attenuating the rise in total exports, Brexit also had the effect of changing the ratio between re-exports and domestic exports. The ratio between re-exports and domestic exports in the 2015–2020 period was always around 48% for re-exports and 52% for domestic exports. In 2023, the ratio shifted to 40% re-exports, 60% domestic exports.
In 2023, imports from the UK fell more sharply than imports from all countries
Figure 2.4.7 shows that imports of goods from the UK to the Netherlands appear to have been less impacted by Brexit. The increase in value has more or less kept pace with the increase in the value of imports from all countries. There was a dip in 2020, the year of Brexit, with imports falling back to just below the level of 2015 (–3 percentage points). That dip was bigger than the dip in imports from all countries. However, imports of goods from the UK to the Netherlands subsequently grew rapidly. By 2022, they had doubled relative to 2015. In 2023, conversely, the value of goods imported from the UK was a quarter less than a year before. That year, imports from Northern Ireland fell slightly more, by 29%. Imports from all countries combined fell less sharply, by 9%.
The latest quarterly figures show that in the first quarter of 2024, the import value of goods from the UK decreased further. Compared to the fourth quarter of 2023, import value from the UK fell by 6% in the first quarter of 2024. Relative to the first quarter of 2023, it was 25% lower.
| jaar | Imports from the United Kingdom | Imports from other countries |
|---|---|---|
| 2015 | 100 | 100 |
| 2016 | 103 | 99 |
| 2017 | 113 | 109 |
| 2018 | 128 | 117 |
| 2019 | 120 | 122 |
| 2020 | 97 | 111 |
| 2021 | 120 | 139 |
| 2022 | 202 | 189 |
| 2023 | 152 | 173 |
The fact that the peak in the growth of imports from the UK in 2022 and the fall in 2023 were greater than for all countries combined is probably explained by the scale of Dutch imports of mineral fuels, such as natural gas and crude oil, from the UK. See also Figure 2.4.8. Mineral fuels rose significantly in price after 2020, before falling sharply again in 2023. In 2023, the Netherlands imported €31.2bn in goods from the UK. Mineral fuels accounted for more than a third (37%) of that figure. In terms of value, that product category was followed by machinery and equipment (20%) and manufactured goods (17%).
| categorie | 2023 | 2022 | 2015 |
|---|---|---|---|
| Mineral fuels | 11.7 | 21.1 | 6.3 |
| Machinery and equipment | 6.2 | 5.7 | 3.0 |
| Manufactured products | 5.3 | 5.8 | 4.0 |
| Chemical products | 4.3 | 5.2 | 4.1 |
| Food and beverages | 1.5 | 1.7 | 1.8 |
| Transport equipment | 1.5 | 1.2 | 0.9 |
| Natural products | 0.6 | 0.8 | 0.4 |
Rise in imports of natural gas from the UK
In Figure 2.4.9, we look at the most important product groups in imports. In both 2015 and 2023, natural gas, crude oil and refined petroleum products were in the top 3, but in a different order. It is striking that the Netherlands significantly increased the value of its imports of natural gas from the UK over that period. That does not necessarily correspond to an increase in volume: natural gas has increased considerably in price in recent years. Nevertheless, in 2023, the Netherlands obtained 11% of its imported natural gas (gaseous and liquid) from the UK, whereas two years before, in 2021, the figure was 2% (CBS, 2024e). Imports of (mobile) telephones, routers and modems are now also higher than in 2015. A number of chemical products have dropped out of the top 15 as it stood in 2015: hydrocarbons and compounds with nitrogenous groups. By 2023, we were also sourcing products like office machines, tyres and inner tubes, shoes and products for photography and cinematography from different countries.
| productcategorie | 2023* | 2015 |
|---|---|---|
| Natural gas | 4.5 | 1.0 |
| Crude oil | 4.4 | 2.0 |
| Refined petroleum products | 1.5 | 2.8 |
| (Mobile) telephones, modems, routers |
1.4 | 0.4 |
| Other chemical products | 0.9 | 0.2 |
| Residues of petroleum oils |
0.7 | 0.2 |
| Turbine or jet engines, propeller turbines |
0.6 | 0.1 |
| Medicines | 0.5 | 0.8 |
| Measurement, monitoring and analysis tools |
0.5 | 0.2 |
| Computers, laptops, tablets | 0.5 | 0.2 |
| Aircraft and spacecraft | 0.5 | 0.0 |
| Medicinal and pharmaceutical products |
0.4 | 0.7 |
| Passenger cars | 0.3 | 0.3 |
| Sports equipment and toys | 0.3 | 0.1 |
| Electromedical and radiological devices | 0.3 | 0.1 |
Imports and exports from a UK perspective
It is interesting to also look at this from the UK perspective. To what extent is the Netherlands an important trading partner for the British and has this changed in recent years? This may be ascertained from data from the UK Office for National Statistics (ONS, 2015; ONS, 2024).
In 2023, the Netherlands was the UK’s third biggest trading partner for exports, after the US and Germany. In 2015, the Netherlands ranked fourth. Of UK goods exported in 2023, 8% went to the Netherlands. In 2015, the figure was 6%.
In 2023, the Netherlands was the UK’s fourth biggest trading partner for its imports, after Germany, the US and China. The Netherlands also ranked fourth in 2015, before Brexit. Of the goods imported by the UK in 2023, 9% were from the Netherlands. In 2015, the figure was 8%.
Although it has repeatedly been shown that the UK’s trade with EU member states has fallen since Brexit (Smid & Frankena, 2021; Du et al., 2023) or in the run-up to Brexit (Douch & Edwards, 2022), these figures show that UK trade with the Netherlands did not fall further than that with other (EU) countries.
2.5References
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Noten
These figures relate to 27 trading partners: China, Hong Kong, Japan, North Korea, South Korea, Macau, Mongolia, Taiwan (in East Asia), Brunei, Cambodia, Philippines, Indonesia, Laos, Malaysia, Myanmar, Singapore, Thailand, East Timor, Vietnam (in Southeast Asia), Afghanistan, Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan and Sri Lanka (in South Asia).
2021–2023 has been chosen as the current period here because 2020 was an exceptional year due to the pandemic and may therefore not provide a good comparison with the subsequent years. Since 2021, geopolitical relations have been characterised by rising tensions (Clingendael, 2023).
This figure includes quasi-transit trade, the transit of goods in foreign ownership. Excluding this flow, import value still grew nearly four-fold, but its size was significantly less: €7.4bn in 2023. In 2022, the Netherlands was the EU’s largest importer of critical raw materials from non-EU countries. An important nuance here is that the overwhelming share, approximately 95% of import value, ultimately finds its way abroad again, either by means of direct transit trade or following the processing of the raw materials in the Netherlands (Bohn et al., 2023). This contrasts with the product side, where a larger share of the imports is intended for the Dutch market. For example, road vehicles (dependent on critical raw materials), in particular cars, are the most important Dutch import product in terms of direct consumption after import (CBS, 2024c).
Rare earth metals are a group of special metals used in many high-tech applications such as smartphones, wind turbines, MRI scanners, hard disk drives, LEDs and electric motors (European Commission, 2023b). Dysprosium, erbium, europium, gadolinium, holmium, lutetium, terbium, thulium, ytterbium and yttrium are heavy earth metals. Cerium, lanthanum, neodymium, praseodymium and samarium are light earth metals (Grohol & Veeh, 2023).
In 2023, the main elements involved were magnesium, manganese, tungsten and cobalt. In the first quarter of 2024, China’s lead over Germany as the biggest supplier of products containing critical raw materials was substantially reduced (to a minimal level). This was partly due to a significant fall in the import value of Chinese solar panels. That in turn was linked to lower prices, bigger (strategic) reserves in Europe (Rystad, 2023) and falling demand (Duintjer Tebbens, 2023). There has also been a reduction in the value of imports of telephones and laptops/tablets from China, which is also connected to lower import prices.