Important developments in 2024 and 2025

Authors: Sarah Creemers, Shalane Pijnenburg, Mauro Pinna, Pascal Ramaekers, Christiaan Visser

This chapter focuses on some important current developments: events or trends in the world that are affecting the Dutch economy and society. The Netherlands is a trading nation that is sensitive to developments abroad. The second section of this chapter discusses the looming import tariffs. The trade war recently initiated by the US, with President Trump announcing or imposing import tariffs on almost all countries, is causing great uncertainty worldwide about exactly what is going to happen and the potential consequences. Will this lead to a temporary increase in trade with the US, in anticipation of higher tariffs? The third section focuses on the US, the EU, China, Russia and India – major power blocs in the world. What are the economic similarities and differences between these blocs, and what role do they play at the global level? The fourth section focuses on a specific and sensitive aspect of international trade: the trade in military goods, such as weapons and ammunition. What are the main countries of origin and destination for Dutch trade? What is the situation with dual-use goods, for example goods that can also be used for military purposes, such as drones? This chapter answers these and many other questions.

2.1Key findings

Trump 2.0: anticipating impending import tariffs

• Unlike many other EU countries, the Netherlands has a trade deficit in goods with the US. The Netherlands had a deficit of €10.3 billion in its goods trade balance with the US in 2023 when we exclude re-exports from both imports and exports in addition to quasi-transit trade. The value of crude oil and natural gas imported from the US was particularly high. When we do not correct for re-exports, the trade balance in goods with the US is even more negative.
• US goods imports rose sharply in Q1 2025, with the total import value up by 25% compared to the same period of 2024. This indicates a possible anticipation effect ahead of possible US import tariffs.
• The strong growth in US imports was driven mainly by a surge in goods from the EU, with a significant increase in imports of organic chemicals and pharmaceuticals, of which Ireland was the main supplier.
• Despite all the uncertainty, Dutch exports increased. Total exports to all countries combined increased in Q2 2024 and Q1 2025, though less sharply than exports to the US.
• Dutch exports to the US were 10.0% higher in Q4 2024 than they were in Q4 2023. For Q1 2025, we see growth of 16.6%. Higher-value exports of chip machinery and pharmaceuticals make up a large proportion of Dutch goods exports to the US.
• Dutch goods exports to Germany also saw strong growth, especially in Q1 2025 compared to Q1 2024.

How is the EU performing compared to the US, China, Russia and India?

• The US, the EU, China, Russia and India are major power blocs in the world, and together they account for two-thirds of global GDP.
• India is the only one of these five blocs with a rapidly growing labour force that will continue to grow as we approach 2050.
• The US has the largest economy of the five blocs, while the EU has had the lowest economic growth in recent years (2021–2024).
• The EU is the world’s largest trader in goods and services and also the largest investor in other regions.
• On innovation, the US performs best by some distance, followed by China, then the EU, with Russia and India a long way behind.
• The EU scores best when it comes to quality of life and life satisfaction. This is followed by the US, with the other three a long way behind.
• In terms of sustainability, the EU has the best performance. India has the smallest ecological footprint, due to relatively high levels of poverty in that country.
• In geopolitical terms, the US is the most powerful country, while Russia has the largest mineral resources by value.

Trade in military goods and dual-use goods

• The Netherlands imported military goods worth €580.8 million in 2024, while its exports of military goods were worth €346 million. For both imports and exports, this was a record since measurements began in 2015. The trend continued into Q1 2025: military goods worth €148 million were imported, almost as much as in the whole of 2019. No previous first quarter on record had seen so many military goods imported and exported as Q1 2025.
• The sharp rise in the import value of military goods began in 2023, when imports increased by 87.6% over the previous year. In 2024, the export value also increased, by 63.6% compared to 2023.
• Germany was by far the main country of origin of military goods coming into the Netherlands in 2024, with a 40% share.
• Motorised combat vehicles (and components) were the most imported goods in 2024 with an import value of €189.9 million. Weapons and ammunition worth €155.9 million were also imported. The import value of these two types of goods accounted for 60% of the import value of military goods.
• The picture for exports is similar; in 2024, motorised combat vehicles (and components) and weapons and ammunition were exported in particular.
• As well as military goods, ‘dual-use’ goods were also traded. These are goods that can be used for both civilian and military purposes, such as drones. The import and export value of these goods followed a similar pattern as non-dual-use goods. For instance, the import value of dual-use goods peaked at €201 billion in 2022. The export value peaked at €228 billion in the same year.
• Germany was the main customer for Dutch exports of dual-use goods, with €36.7 billion worth of these goods going to Germany in 2024. Looking solely at Dutch domestic exports, the US was the main buyer. Indeed, of exports to Germany, a relatively large share were re-exports.
• In 2024, the US was the main country of origin for Dutch imports of dual-use goods, followed closely by Germany and China.

Outline

In section 2.2, we identify the possible anticipation effects in exports to the US. To do so, we look at US imports based on trade data from the U.S. Census Bureau and Dutch exports based on trade data from CBS. This is followed in section 2.3 by a comparison between the world’s economic and/or military superpowers: the US, China, the EU, Russia, and India. The Dutch trade in military and dual-use goods is discussed in section 2.4.

2.2Trump 2.0: anticipating impending import tariffs

In November 2024, Donald Trump was once again elected President of the United States. During his first presidency, he pursued a highly protectionist trade policy under the slogan America First. In March 2018, he announced high import tariffs on steel and aluminium of 25 and 10%, respectivelynoot1, with the goal of protecting US manufacturing (The White House, 2018). Not long after, the situation escalated into global trade conflicts, the most important examples being the trade wars between the US and China and between the US and the EU. The tensions with China led to reciprocal import tariffs worth hundreds of billions of US dollars (Fajgelbaum & Khandelwal, 2021). The tariffs on Chinese imports were first imposed by President Trump and were maintained by President Biden (Tankersley, 2024). At the same time, the US also imposed tariffs on European steel in order to protect its domestic steel industry, whereupon the EU responded with retaliatory tariffs on a range of US products, such as whisky, orange juice, meat, and steel and aluminium products (Franssen et al., 2020; Van de Hei et al., 2018). These trade measures had a negative impact on global trade and contributed to a weakening of global economic growth (IMF, 2019). In 2021, the US and the EU suspended the measures following an agreement under President Joe Biden (Evofenedex, 2025).

The re-election of Trump has often been cited as a breaking point (Nelson, 2024; Walsh, 2024). Since his re-election, President Trump has been threatening to impose import tariffs on all goods from all countries. For example, on 10 February 2025 he signed a decree that would increase import tariffs on steel and aluminium to 25%. These tariffs were aimed at all countries and also covered nearly 300 derivative products (Evofenedex, 2025; Executive Office of the President, 2025a and 2025b). In late February, he also announced a 25% tariff on all goods imported from the European Union, which led to nervousness in the international markets (Pogue, 2024; Van Rijkswijk, 2025). On 2 April 2025, these plans came a step closer to reality when President Trump announced the implementation of a baseline tariff of 10% on all goods entering the US. This tariff would apply to virtually all countries, including the EU (De Lemos Peixoto et al., 2025). In addition, a supplementary tariff was announced that would be dependent on the bilateral trade balance in goods and would see increased tariffs for countries running large trade deficits with the United States. For the EU, that would have meant an import tariff of 20%. This increased tariff was initially due to take effect on 9 April 2025. However, on that date, President Trump announced that its implementation would be delayed by 90 days. This meant that for the time being, only the baseline tariff of 10% remained in place, which at that time was due to come into force on 6 July 2025 (Da Rocha et al., 2025).

A possible consequence of these impending import tariffs is that trading partners will expedite their exports to the US in order to pre-empt future import tariffs. This phenomenon is known as the anticipation effect, and refers to accelerated trade flows in anticipation of policy changes in order to avoid future cost increases. This appears to be the case here, as the US import value increased by 32.2% in March 2025 relative to the same month a year before. The value of US imports also grew substantially in January and February (U.S. Census Bureau, 2025). In China, early shipping of goods to the US to pre-empt possible import tariffs led to export growth in November and December 2024 and January 2025 (BNR, 2024; U.S. Census Bureau, 2025). Chinese exports to the US fell sharply in April 2025, when the US imposed new import tariffs (Bao, 2025a; Feingold & Botwright, 2025). There also appears to be anticipation of President Trump’s trade policy within the EU, with exports from the EU to the US growing significantly in February and March 2025, in the run-up to the announced import tariffs (Dulaney, 2025; Reuters, 2025). For instance, Flemish breweries attempted to get their stocks of beer across the US border as quickly as possible before potential excise duties or import tariffs could take effect (Segers, 2025). Companies in the Netherlands followed the same strategy and increased their exports to the US while the new import tariffs were not yet in force (Van Rijswijk 2025).

US imports spike in anticipation of import tariffs

The value of US goods imports increased sharply in the first quarter of 2025. Compared to the same period in 2024, import value rose by 25%, with a 12% increase relative to the final quarter of 2024 (U.S. Census Bureau, 2025). This strong growth may indicate an anticipation effect,

with US firms bringing forward their imports in order to avoid additional costs in the run-up to the looming import tariffs. Subsequent to this, a clear retrenchment was visible in April 2025, with import value falling by 19% from the previous month. There was still a modest rise of 2% compared to April 2024, but this limited increase contrasts sharply with the substantial growth in the first quarter. The fall in April 2025 compared to a month before coincided with the announcement of the new import tariffs on 2 April 2025noot3 – to take effect from 5 April 2025 – and represents the largest monthly drop in imports ever (McCormick & Wells, 2025). The timing and size of this contraction reinforce the notion that companies increased their imports earlier in the year in order to pre-empt new tariffs, which points to a possible anticipation effect.

US import growth primarily attributable to the EU

Figure 2.2.2 shows the percentage change in the import value of goods from the United States’ main trading partners, measured per month compared to the same month a year before. A striking feature is the rise in imports from the EU. In March 2025, these stood at $83.7 billion, which is $33.2 billion more than in March 2024. This represents an increase of 66%. As such, the EU made the largest contribution to the increase in US goods imports in this period. Relative to February 2025, imports from the EU rose by 54% in March. Anticipating possible tariff increases, companies in the US imported additional goods from the EU. In April, imports fell by 35% compared to March, bringing them back to the same level as in April 2024.

Imports from Mexico and Canada also rose in March 2025 compared to the same month a year before, increasing by 16% and 5%, respectively. In April 2025, by contrast, imports fell relative to the previous year, by 3% for Mexico and 15% for Canada. This again points to a possible anticipation effect, although less pronounced than for the EU. In November 2024, President Trump first threatened to impose import tariffs of 25% on all goods arriving from Mexico and Canada (Colvin & Gillies, 2024). Those import tariffs were originally due to take effect on 4 February 2025, but this was initially postponed by 30 days (Philips et al., 2025). The tariffs then came into force on 4 March, but two days later they were suspended until 2 April 2025 for goods that meet the provisions of the United States-Mexico-Canada Agreement, or USMCA (Becker et al., 2025). This temporary suspension may have contributed to the anticipation effect, by prompting importers to hastily import USMCA goods before the tariffs actually took effect. The fact that only half of product types from Mexico and slightly more than a third of product types from Canada fall under the USMCA may explain why the anticipation effect was less pronounced in these countries (Li, 2025). The fact that the import tariffs for the other goods were already in place from March may have inhibited imports of those goods.

Imports from China displayed a different pattern, with signs of anticipatory behaviour evident as early as November 2024. US importers brought forward deliveries from China in order to pre-empt import tariffs, resulting in imports from China peaking at their highest level in over two years in the same month (BNR, 2024). This early increase could be explained by the fact that during the election campaign, President Trump announced that he would be imposing tariffs of over 60% on Chinese goods if he were re-elected, prompting firms to start bringing forward their orders in late 2024 (Hoskins, 2024). Although imports from China were still 10% higher in December 2024 than in the same month a year before – and a full 16% higher in January 2025 – this trend reversed from February. Compared to February 2024, imports fell by 1% in February 2025, followed by a further 2% contraction in March. The decline accelerated significantly in April, with imports dropping by 20% compared to April 2024. In May, the sharpest fall in over five years was observed compared to the same month of the previous year, with a reduction of nearly 35% (Bao, 2025b). The turnaround from February coincided with the implementation of a 10% general import tariff on Chinese goods on 4 February 2025 (Ross et al., 2025). In response, shortly afterwards China imposed retaliatory tariffs of 10 to 15% on a range of US goods (Hawkins, 2025).

EU27

Mexico

Canada

China

T1: Import tariffs EU

T2: Import tariffs for China, originally also for Canada/Mexico¹⁾

Postponement for Canada/ Mexico¹⁾

Source: U.S. Census Bureau (2025)
¹⁾ The tariffs for Mexico and Canada were initially scheduled to take effect on 4 February 2025, but this was postponed until 4 March 2025 for regular goods and until 2 April 2025 for USMCA goods.

Show datatable2.2.2 US imports, by trading partner (year-on-year % change)Hide datatable2.2.2 US imports, by trading partner (year-on-year % change)

2.2.2 US imports, by trading partner (year-on-year % change)

Partner	EU27	Mexico	Canada	China
nov-24	13.3	6.6	-7.5	6.5
dec-24	3.3	7.7	7.6	9.9
jan-25	17	9.7	14.7	16.2
feb-25	22.3	3.5	5.4	-0.9
mar-25	65.4	15.7	5	-1.7
apr-25	-0.2	-2.6	-14.5	-19.6

Exceptional growth visible in US imports of organic chemicals

The rapid rise in US imports from the EU in the first quarter of 2025 was primarily due to a substantial increase in the import value of organic chemicals and pharmaceutical products. Imports of organic chemicals in particular rose sharply: whereas the import value from the EU was only $6.8 billion in the first quarter of 2024, in the same quarter the following year it grew to $41.0 billion. This represents a 503% increase. This rise is mainly the result of a growth in deliveries of chemical products to the US (Eurostat, 2025a) and is primarily attributable to a large absolute increase in the import value of hormones, moving this product category up to second place among the most imported goods from the EU. Pharmaceutical products were the most imported product category from the EU throughout 2024. In the first quarter of 2024, import value totalled $29.3 billion, with the figure rising by 42% in the first quarter of 2025 to $41.5 billion. Although this meant that pharmaceutical products retained their position as the most imported product category, the difference with organic chemicals is now only $0.5 billion.

US importing significantly more from Ireland

Figure 2.2.3 shows the percentage change in the import value of goods from the United States’ largest EU trading partners, measured per month relative to the same month of the previous year. US imports from Ireland reached an exceptionally high level in March 2025. There had already been substantial growth in January and February, with increases of 86% and 135%, respectively, compared to the same months a year before. This upward trend was strongly maintained in March, when imports increased by no fewer than 284% compared to March 2024. This mainly concerned organic chemicals, the product category with the largest absolute growth, followed by pharmaceutical products.

This substantial increase appears to reflect a conscious decision on the part of US importers to bring forward shipments. They are vulnerable to new import tariffs due to the strong trade relationship with Ireland and therefore wanted to get their stocks across the border in timely fashion (Burke-Kennedy, 2025). This seems to be primarily the result of a sharp increase in imports from pharmaceuticals companies in Ireland, which increased their deliveries in advance of the announced import tariffs (Curran, 2025). US imports from the Netherlands also rose in March 2025 compared to the same month of the previous year: the US imported 67% more goods than in March 2024, with the largest absolute increase being seen in pharmaceutical products.

Show datatable2.2.3 US imports by EU-27 trading partner (year-on-year percentage change)Hide datatable2.2.3 US imports by EU-27 trading partner (year-on-year percentage change)

2.2.3 US imports by EU-27 trading partner (year-on-year percentage change)

EU-partner	November 2024	December 2024	January 2025	February 2025	March 2025	April 2025
Ireland	81.4	7.1	86.3	135.4	283.8	6.9
Germany	6.6	0.0	10.5	3.3	9.8	-8.3
Ferance	23.9	2.1	4.2	0.0	56.0	20.4
Italy	4.8	4.9	-4.7	12.5	12.5	-4.4
Netherlands	-28.9	-21.9	3.4	-13.3	66.7	13.8
Belgium	-12.5	10.0	17.6	-10.5	47.8	-18.5
Source: U.S. Census Bureau (2025)

Fastest growth in exports to the US

Figure 2.2.4 presents the five principal markets for total Dutch exports in 2024. Total exports to all countries combined increased by 2.0% in the fourth quarter of 2024 and by 4.3% in the first quarter of 2025. This meant that total exports grew less rapidly than exports to the US. In spite of all the uncertainties, Dutch exports to the US were 10% higher in the fourth quarter of 2024 than in the same quarter of the previous year. That trend continued into the first three months of 2025: Dutch companies exported 16.6% more to the US in the first quarter of 2025 relative to the same quarter last year.

In particular, the value of chip manufacturing equipment and medicines exported to the US increased in the fourth quarter of 2024. Exports of medicines to the US were affected by sharp price increases.

Show datatable2.2.4 Exports to top 5 export destinations in 2024 and rest of the world (Year-on-year % change)Hide datatable2.2.4 Exports to top 5 export destinations in 2024 and rest of the world (Year-on-year % change)

2.2.4 Exports to top 5 export destinations in 2024 and rest of the world (Year-on-year % change)

Bestemming	Q4 2024*	Q1 2025*
Germany	1.6	6.8
Belgium	2.7	-0.3
France	0.4	-2.5
UK	-9.9	2.8
US	10.0	16.6
Rest of the world	2.0	4.3

The growth in the first quarter of 2025 was due in part to an increased export value of medicines, chip manufacturing equipment and medicaments and pharmaceutical products. The medicines exported to the US were significantly more expensive in the first quarter of 2025 than they were in the same quarter of the previous year. The rise in exports of medicaments and pharmaceutical products was primarily the result of a volume increase. In April 2025, President Trump announced plans to impose an import tariff on pharmaceutical products (Hagan & Shukia, 2025; Lucas, 2025). We may see the effect of this in the Dutch export figures from April 2025. Exports of refined petroleum products to the US fell sharply, mainly due to lower export volumes. Export prices also fell, but less sharply than the volumes.

Growth also seen in exports to Germany

Dutch exports of goods to Germany rose sharply, particularly in the first quarter of 2025 relative to the same quarter last year, increasing by 6.8%. We see higher export values to Germany for many different goods, including footwear, cocoa, natural gas and medicines.

Exports to the UK also rose, by 2.8%. The decline in Dutch exports to the UK in the fourth quarter of 2024 is attributable to a lower export value of refined petroleum products. These products also account for the decline in Dutch exports to France in the first quarter of 2025.

2.3The EU’s performance compared to the US, China, Russia and India

The rise of China as an economic superpower, the invasion of Ukraine by Russia, President Trump’s second term in the United States and ongoing turmoil in the Middle East have caused the global geopolitical situation to reach a boiling point. The world is increasingly viewed as a battleground between superpowers in an ever more fragmented global order, in which the Netherlands is a minor player. Geopolitical expert Khanna (Katawazi, 2025) describes the current global order as increasingly chaotic, in which nearly twenty countries have an economy worth over 1 trillion US dollars – a world in which countries no longer can side with one of two superpowers, as was the case during the Cold War. According to Katawazi (2025), the countries that prove most adept at playing the geopolitical game, with investment deals, trade agreements and tech collaborations, will come out on top. Due to the explosive global situation and the related growing uncertainties about its own security, in early 2025 the EU decided to invest €800 billion in rearming Europe (European Commission, 2025a), a step that would have been unimaginable a year before (Giesen, 2025).

This section looks at where the EUnoot4 currently stands, by analysing key indicators related to demographics, economics, globalisation, innovation, quality of life, sustainability and geopolitics. This involves making a comparison for all the indicators with four other major power blocs in the world – the US, China, Russia, and India.noot5 The outcomes of the analysis yield insight into the EU’s strengths and weaknesses. Before performing this analysis, we first outline the historical context by highlighting the performance of the power blocs in goods trade with the rest of the world.

Historical context: goods trade since 1995

Figure 2.3.1 shows how the goods exports of today’s major power blocs have changed since 1995. The figures are expressed in percentages. For instance, in 1995 the US had a 14% share of total global exports to Asia, which had fallen to 7% in 2023.

The following facts are worthy of note:

• In 1995, the EU accounted for the largest share of exports to Europe, Asia and Africa, and, jointly with the US, also to South America and Oceania. Since then, the EU share to virtually all regions has declined, but the EU remains an important player in all regions. Exports from the EU to Africa in particular have fallen sharply.
• The US was the second-largest goods exporter of any major power bloc in 1995, but it has since been overtaken by China. Just as with the EU, the importance of the US as an exporter has declined in almost all regions.
• It is widely known that China has seen substantial growth as an exporter and has increased its market share across all regions, with the largest relative increases in South America, Africa, and Oceania. Russia and India remain modest exporters of goods, but both have seen their market shares grow in almost all regions.

Show datatable2.3.1 Share of major power blocs in global exports to the different continents Hide datatable2.3.1 Share of major power blocs in global exports to the different continents

2.3.1 Share of major power blocs in global exports to the different continents

Continent	Year	US	EU27	China	Russia	India	Other countries
Europe	1995	6%	63%	1%	2%	0%	28%
	2023	6%	58%	8%	2%	1%	24%
Asia	1995	14%	16%	6%	1%	1%	62%
	2023	7%	10%	19%	2%	2%	60%
North America	1995	18%	13%	3%	0%	1%	65%
	2023	17%	15%	15%	0%	2%	50%
South America	1995	25%	25%	1%	0%	0%	48%
	2023	21%	15%	23%	1%	2%	38%
Africa	1995	7%	47%	2%	1%	1%	43%
	2023	4%	23%	23%	2%	6%	42%
Oceania	1995	18%	19%	3%	0%	1%	60%
	2023	11%	14%	24%	0%	2%	49%

The major power blocs not only send goods to the rest of the world, but they also receive them. Table 2.3.2 shows that the global trends in goods imports barely differ from the trends observed for exports. In the table below, we see the shares of the power blocs (in the rows) in total imports from continents (in the columns).

	Shares of power blocs
	Europe	Asia	North America	South America	Africa	Oceania
	%
US
1995	7	21	24	23	14	7
2023	9	7	17	21	4	11
Difference	2	–15	–7	–2	–10	3
EU
1995	59	15	15	23	50	10
2023	54	10	15	15	23	14
Difference	–5	–5	0	–8	–27	4
China
1995	1	5	2	2	1	4
2023	6	19	15	23	23	24
Difference	5	14	13	21	22	20
Russia
1995	2	1	0	1	0	0
2023	1	2	0	1	2	0
Difference	0	1	0	1	2	0
India
1995	1	1	0	0	2	1
2023	2	2	2	2	6	2
Difference	1	1	2	2	4	1

Source:UNCTAD (2024a)

A deeper analysis reveals to what extent the major power blocs have a bilateral trade relationship. Because the data is recent (from 2023), it is possible to combine the goods trade with data on services. As such, it provides a picture of the trade in both goods and services. The results provide context on the ongoing trade war, which has mainly been fought by the US and China in the first half of 2025 with high import tariffs (Van der Spek, 2025). Table 2.3.3 shows that these two power blocs do indeed trade extensively with each other and that the US imports twice as many goods and services (measured in US dollars) from China than the other way around. However, by far the largest volume of trade takes place between the US and the EU, over twice as much as between China and the US. Indeed, there is more trade between the EU and China than between the US and China. All other trade between the different power blocs is smaller in scale.

Table 2.3.3 also shows that the EU is the most important market for both the US and China. For the EU and India, the US is the largest export destination.

Russia’s largest market is China. Russia itself is the least important export destination for all the other power blocs. Apart from the fact that Russia has the smallest economy, this is partly due to Western sanctions imposed on Russia following the invasion of Ukraine. In May 2025, the EU adopted a 17^th package of sanctions against Russia in order to further constrain the Russian war industry (Rijksoverheid, 2025a) and it aims to completely phase out imports of Russian gas (NOS, 2025b).

China has by far the largest trade surplus with the other power blocs. This is primarily the result of trade with the US and the EU. Russia also has a trade surplus due to its trade with India. Conversely, the US, the EU and India all have trade deficits with the other power blocs. The US trade deficit with the other four major power blocs is nearly as large as China’s trade surplus with those power blocs. In March 2025, in anticipation of an impending trade war, the US trade deficit rose to an unprecedented $179 billion (Kopack, 2025).

	To
	US	EU	China	Russia	India
From
US		574	196	3	75
EU	729		335	52	81
China	448	530		116	126
Russia	6	59	126		64
India	120	96	25	6

Source:Eurostat (2025a), OECD (2025), OECD-WTO (2025)

Demographics: The future is Indian

Having provided historical context with figures on trade with the rest of the world, we now turn to the core of this section with a comparison of the five major power blocs in different areas. The first comparison concerns demographics; see Table 2.3.4.

In April 2023, India overtook its neighbour China as the country with the highest total population (Kleinhuis, 2023). India and China are, by some distance, the countries with the largest populations. Today, more than one in three global citizens are Indian (17%) or Chinese (also 17%). These power blocs are followed by the EU (6% of the world population), the US (4%) and Russia (2%). A large population provides sufficient labour and economic growth, and makes a country an important market for other countries.

At the same time, a large population places great pressure on scarce resources and makes it hard to keep poverty and unemployment under control. For instance, India has the largest number of people living in extreme poverty in the world, and there is also a high degree of income inequality (Goris, 2023).

A major difference between China and India relates to projected population growth by 2050noot6, which is strongly negative for China and strongly positive for India. China has an ageing population – the median age is more than 10 years higher than in India – with the number of deaths being insufficiently compensated by births or immigration. In addition, life expectancy in India is significantly lower than in China, which means that China has a relatively larger number of people who are not active participants in the labour market. This explains why trends in the working-age population – economically more relevant than the total population – differ even more between the two countries. The size of the Chinese working population increased until 2015, but it has not grown since then. The expectation is that the Chinese working population will shrink significantly after 2027 and will be 22% lower in 2050 than in 2025 (De Jong, 2024). See CBS (2020) and CBS (2023a) for more details on the Chinese and Indian economies.

Like China, the EU and Russia have ageing and shrinking populations and even more rapidly shrinking labour forces. As a result of migration flows, the size of the EU’s working population is expected to fall less than China’s, but a substantial contraction of 17% is still expected by 2050 (UN, 2024). As a result of expected migration and a younger population, the US will be able to avoid a contraction in its population and its labour force is projected to grow by 5% by 2050 compared to 2025 (UN, 2024). See CBS (2025b) for more details on the US economy.

In terms of demographics, it may be concluded that without action, the EU may lose in economic significance and political influence due to the significant impact of population ageing. The same is true for China, although it does have a much larger population (Bolhuis, 2025). Towards the end of the 21^st century, as a result of major demographic differences, it is expected that there will be an income shift from Europe, North America – mainly the US – and China to South Asia – mainly India – and Africa (Brakman et al., 2024).

According to the UN, China will still have three times more inhabitants than the EU in 2050. On the other hand, many Chinese people do not have the level of education required to keep up with the changing economy (Nieuwsuur, 2025). Of the five major power blocs, India has the most positive outlook in terms of population, with a large population that is continuing to grow and an even stronger growth in the labour force. With a relatively young population, India is well placed to take advantage of technology and innovation. As such, Indian demographics can contribute to economic growth. At the same time, there are concerns about high youth unemployment and a possible shortage of jobs (Kleinhuis, 2023). Child labour is also a feature of the Indian economy (Rijksoverheid, 2021), and more than half the working population are employed in agriculture; moreover, unlike China, India has not made a shift towards large-scale industrialisation to boost production (Boerema, 2025).

	Year	US	EU	China	Russia	India
Median age (years)	2024	38.9	44.7	40.2	41.9	29.8
Number of inhabitants on 1 July (million)	2025	347	449	1,416	144	1,464
Number of inhabitants on 1 July (million)	2050	381	421	1,260	136	1,680
Growth in population (%)	2025–2050	10	–6	–11	–6	15
Growth in labour force (%)	2025–2050	5	–17	–22	–12	17
Life expectancy at birth (years)	2023	78.4	81.4	78.0	73.3	72.0

Source:CIA (2025), Eurostat (2025b), UN (2024), World Bank (2025a and b)

The EU has the lowest economic growth

In the economic sphere, the US is the largest global power, with a GDP of over $29 trillion; see Table 2.3.5. It is followed a long way behind by the EU and China and, far more distantly, by India and Russia. The large discrepancy between India and China is entirely explained by a much lower per capita income – there is hardly any difference between them in terms of population size. In other words, India is much poorer than China on average.

Russian GDP per capita is slightly higher than China’s, and the EU is positioned precisely between the US and Russia.

The EU displays the lowest economic growth – averaging 2.8% in the period 2021–2024, which is lower than that seen in the US and Russia, and much lower than India and China. The EU is also characterised by relatively high unemployment and relatively few working hours per working week. However, labour productivity is much higher than in China, Russia and India, but significantly lower than in the US.

Various international indexes – see the annex in section 2.5 for an explanation – provide more detail on the relative economic positions of the different power blocs. The US and China score highly on the quality of (trade) infrastructure and the business climate – and the EU somewhat less highly on average. In terms of logistics performance, the differences are minimal. The EU actually scores significantly better on the Open for Business Index, meaning it has a better business climate than the other power blocs.

	Year	US	EU	China	Russia	India
GDP ($bn)	2024	29,185	19,413	18,748	2,161	3,909
GDP per capita ($)	2024	85,812	43,050	13,313	14,795	2,711
Economic growth (%, average)	2021–2024	3.6	2.8	5.5	3.2	8.3
Labour productivity (GDP per hour, 2021 prices)	2025	81.8	71.3	19.8	44.3	10.7
Workload per employee (hours per week)	2024	36.1	32.1	44.8	38.2	45.8
Unemployment (% of working population)	2023	3.6	6.0	4.7	3.1	4.2
Logistics Performance Index (ranking; n= 140)	2023	19	17	20	96	39
Global Quality Infrastructure Index 2023 (ranking; n= 186)	2023	3	13	2	51	10
Entrepreneurship index (ranking; n= 90)	2024	2	16	8	27	28
Open for business index (ranking; n= 90)	2024	53	26	54	90	47

Source:ILO (2024 and 2025), IMF (2025a-c), Mesopartner & Analyticar (2023), US News et al. (2025), World Bank (2025c and d)

The EU is the largest trader and investor

Although the EU’s economic growth is on the low side, the EU has performed well in terms of international economic relations for decades, as we saw at the start of this section. For example, the EU is the largest trader in goods and services with other countriesnoot7 and is by far the largest foreign investor; see Table 2.3.6. The US and China also trade extensively with other countries, but that trade remains relatively small compared to the GDP of the US or the total population of China. Russia and India contribute much less to globalisation-related activities than the US, the EU or China. Even so, the differences are less pronounced if we compare each country’s current account balance with its own GDP. We then see that the EU and Russia have the largest trade surpluses, at 3% of GDP, China’s has a surplus of 2%, while India has a deficit of 1% and the US has a deficit of 4%.

	Year	US	EU	China	Russia	India
Goods imports ($bn)	2024	3,359	2,634	2,587	295	702
Goods exports ($bn)	2024	2,065	2,796	3,577	417	443
Services imports ($bn)	2024	812	1,441	611	81	269
Services exports ($bn)	2024	1,107	1,642	446	42	375
Current account balance (% of GDP)	2024	–4	3	2	3	–1
Openness to trade (% of GDP)	2023	25	96	37	42	46
Inward investment position ($bn)	2023	5,394	15,863	3,650	498	729
Outward investment position ($bn)	2023	6,676	18,742	2,955	375	118

Source:IMF (2025d and e), World Bank (2025e), WTO (2025)

The US leads the way in innovation

In terms of innovation, the United States is the clear leader compared with the other four power blocs; see Table 2.3.7. The Global Innovation Index ranks the US in third place, after Switzerland and Sweden. The country scores particularly highly for the functioning of companies (networks, strategy), the functioning of the market (competition), knowledge, and innovation results. The US also occupies a third position in a different ranking, the Global Talent Competitiveness Index, after Switzerland and Singapore. This index measures countries’ ability to develop, attract and retain talent. With the current uncertainty about obtaining student visas for courses in the US (RTL, 2025), the US may drop down this ranking in the near future, but this effect is not yet reflected in the current figures. A third ranking, the World Digital Competitiveness Ranking, has the US in fourth place, behind Singapore, Switzerland and Denmark. The EU and China are significantly lower than the US in the three innovation rankings, but considerably higher than Russia and India.

In terms of R&D expenditure, we see the same patterns; the US spends the most on R&D, followed by the EU and China and, a long way behind, by Russia and India. However, the US does export far fewer high-tech goods than the EU and China. In terms of internet use, virtually the entire populations of the US, the EU and Russia have access to the internet, whereas China and India, with their relatively large rural populations, are lagging behind (World Bank, 2025f).

	Year	US	EU	China	Russia	India
Global Innovation Index (ranking; n= 134)	2024	3	17	11	59	39
Global Talent Competitiveness Index (ranking; n= 135)	2023	3	20	40	52	103
World Digital Competitiveness Index (ranking; n= 68)	2024	4	26	14	45	53
R&D expenditure (% of GDP)	2022	3.6	2.2	2.6	0.9	0.6
High-tech exports ($bn)	2023	209	922	825	11	41
Internet use (% of inhabitants)	2023	93	91	78	92	56

Source:IMD (2024), INSEAD (2023), World Bank (2025f-h), WIPO (2024)

The EU has the highest quality of life

A fifth comparison we make in this section relates to quality of life; see Table 2.3.8. For this purpose, we looked at nine indexes that rank the world’s countries in terms of people’s life satisfaction and quality of life.

Although each of the nine indexes measures different aspects of wellbeing, from gender inequality to happiness and from democracy to corruption, the results are strikingly consistent. The US and the EU occupy a markedly higher position than China, Russia and India in all nine indexes. The differences between the US and the EU are relatively small, but they are clearly in the EU’s favour: the EU scores seven times higher and the US two times. The EU has a higher score in terms of gender and income inequality, education, democracy, press freedom, social progress, good governance and combating corruption.

The Scandinavian countries and the Netherlands are invariably at the top of almost all rankings in terms of quality of life.

China is around the global average in terms of corruption, social progress, satisfaction and human development and scores poorly for inclusiveness, democracy, press freedom and governance. India scores poorly in all categories except for democracy, but its average performance is roughly the same as that of Russia, which achieves variable scores.

	Year	US	EU	China	Russia	India
Global Gender Gap index (n= 147)	2025	43	29	106	81	129
Human Development Index (n= 194)	2025	17	21	79	65	131
Inequality adjusted HDI (n= 194)	2025	30	17	69	48	121
World Happiness Report (n= 148)	2025	24	26	69	67	119
Democracy Index (n= 168)	2025	28	21	145	150	41
World Press Freedom Index (n= 181)	2025	58	22	179	172	152
Social Progress Index (n= 171)	2025	32	19	73	78	112
Worldwide Governance Indicators (n= 216)	2023	35	29	135	191	112
Corruption Perception Index (n= 181)	2025	28	28	77	154	97

Source:EIU (2025), RSF (2025), SPI (2025), Transparency (2025), UNDP (2025), WEF (2024), World Bank (2025i), WHR (2025)

The EU also scores best for sustainability

The EU performs relatively well in terms of sustainability; see Table 2.3.9. The first six countries in the United Nations’ Sustainable Development Goals Index are all EU member states (Finland, Sweden, Denmark, Germany, France and Austria), while the EU as a whole is in 10^th place. That is much higher than the US, China, Russia and India. The Environmental Performance Index by Block et al. (2024) shows a similar picture, but China and India are significantly lower in the rankings.

A third sustainability index, the Climate Change Performance Index, shows a picture similar to the Sustainable Development Goals Index, except that India is remarkably high on this list – higher even than the EU. An important reason why India scores well on this index is its economical use of energy. This is not so much a consequence of domestic policy but more a manifestation of relatively high poverty and relatively little luxury.noot8

This is also reflected in the absolute figures, with India having three times fewer fossil CO₂ emissions per capita than the EU and using less than half the materials (Crippa et al., 2024). The US scores worse than the EU on all the sustainability indicators listed.

	Year	US	EU	China	Russia	India
Sustainable Development Goals Report (ranking; n= 168)	2025	45	10	50	52	100
Environmental Performance Index (ranking; n= 181)	2024	35	11	156	83	176
Climate Change Performance Index (ranking; n= 63)	2025	54	14	52	61	7
CO2 emissions (fossil) per capita (tons of CO2)	2023	14	6	9	14	2
Greenhouse gas emissions per capita (tons of CO2eq.)	2023	18	7	11	19	3
Domestic material consumption per capita (tons of goods)	2024	23	13	27	12	6
Water consumption per capita (m3water)	2020	1,342	423	395	444	551

Source:Block et al. (2024), Burck et al. (2025), Crippa et al. (2024), FAO (2025), UN & IRP (2025)

The US is the strongest geopolitical power, while Russia has the largest natural resources

This section concludes with a comparison of geopolitical power; see Table 2.3.10.

The Wharton School of the University of Pennsylvania and other contributors have drawn up a power ranking based on global leadership, economic influence, exports, political influence, international alliances and military power (US News et al., 2025). The US tops the list, followed by China and Russia. The US also has a unique and still undisputed monetary advantage, thanks to the position of the US dollar as the global reserve currency (Kersten, 2025). This gives the US additional influence on trade, geopolitics and financial markets. India only manages 12^th place in the power rankings. No score has been calculated for the EU as a whole, and nor can a score be determined from the scores of individual EU countries in this context. Individually, Germany (5^th in the world) and France (7^th) have the highest scores of all EU member states. The Netherlands is in 24^th place in this ranking.

Quantitative data is also available in the military domain. Defence expenditure as a percentage of GDP is an indicator commonly used as a proxy for a country’s willingness to strengthen and maintain its own defence. At a major NATO summit in The Hague in June 2025, it was decided to increase the target for defence expenditure to 5% of GDP by 2035 at the latest (NATO, 2025). Of that 5%, 3.5 percentage points are earmarked for core defence and 1.5 percentage points for necessary conditions such as infrastructure, military innovation and cyber defence. Among the five major power blocs, only Russia (at 7.1% of GDP) and the US (at 3.4%) spent significantly on defence in 2024.

According to the Global Firepower Index, the US, Russia, China and India – in that order – are the countries with the most military and geopolitical power. Again, it is difficult to calculate a score for the EU. However, we can add up the number of military personnel of the EU countries, which produces a figure comparable to that of the US, Russia, and India. Only China’s armed forces are significantly larger. The number of combat aircraft in the EU is somewhat higher than in China, Russia and India, but significantly lower than in the US. The number of tanks in the EU is comparable with that of the US and India, but lower than in China and Russia. In the maritime domain, it is the EU that plays a dominant role. The US and Russia have by far the most nuclear weapons, with the others lagging a long way behind. In the EU, only France has nuclear weapons (Ummels, 2025).

Another geopolitical aspect for which data is available concerns the presence of natural resources. In the event of geopolitical tensions, a country with a dominant position in the global supply of a specific raw material can impose export restrictions, as China has previously done with the critical materials gallium, germanium, antimony and rare earth elements. In early 2025, a shortage of rare earth metals caused by export restrictions led to problems for global industry (Van Coevorden, 2025). The EU has been wrestling with a relatively high import dependence in both critical materials and fossil fuels for some time. Since the outbreak of the war in Ukraine, there have been increased concerns about potential natural gas shortages in the EU, mainly because the EU is no longer able or willing to rely on supplies from Russia (Rijksoverheid, 2025b; NOS, 2025b). In 2022, the EU imported 62.5% of the energy it consumed – the highest percentage since 1990 (Wettengel, 2024). In the Netherlands, energy dependence on other countries actually increased from 70% in 2015 to 78% in 2024 (CBS, 2025c).

The EU’s situation is highlighted by the figures in Table 2.3.10. The EU has fewer oil reserves, fewer gas reserves, fewer coal reserves and fewer critical materials than all the other power blocs. The value of its natural resources is less than $5 trillion, which contrasts sharply with the natural resources of Russia ($75 trillion), the US ($45 trillion) and China ($23 trillion). China has fewer fossil fuels than Russia and the US, but it does have a dominant position within many value chains of critical materials. China is not only the largest producer of fourteen critical materials, but also the leading player further down the chain as a processor of extracted materials and a manufacturer of end products such as telephones, laptops, batteries and solar panels (CBS, 2023b).

	Year	US	EU	China	Russia	India
Power Index (ranking; n= 90)	2024	1	.	2	3	12
Defence expenditure (% of GDP)	2024	3.4	1.9	1.7	7.1	2.3
Global Fire Power Index (ranking; n= 146)	2025	1	.	3	2	4
Military personnel (millions)	2025	1.3	1.5	2.0	1.3	1.5
Aerial combat units	2025	13,043	5,228	3,309	4,292	2,229
Number of tanks	2025	4,640	4,262	6,800	5,750	4,201
Naval combat units	2025	440	1,817	754	419	293
Nuclear weapons	2025	3,700	290	600	4,299	180
Oil reserves (billons of barrels)	2025	38.0	2.0	26.0	80.0	5.0
Gas reserves (trillions of m3)	2025	13.4	0.5	6.7	47.8	1.4
Coal reserves (millions of tons)	2025	249	86	143	162	111
Largest producer of critical materials (number)	2022	2	0	14	1	2
Value of natural resources (trillions of US dollars)	2025	45	<5	23	75	5

Source:GFP (2025), SIPRI (2025), USGS (2025), US News et al. (2025), Worldostats (2025)

In conclusion

We have seen that the EU scores best in terms of quality of life, trade and sustainability, while the US also has three highest scores, namely on economy, innovation and geopolitics. Of the other three countries, only India has a highest score, namely for demographic developments (a growing labour force). The US has the highest total score, followed by the EU, China, Russia, and India, respectively. The US does not score lowest in any area, unlike the other regions.

The EU performs well compared to the world’s other power blocs, on average. However, it scores slightly below average in four areas that will be important in the future, and even in the near future: demographics (the EU has a shrinking labour force), economy (for example low economic growth), innovation (lagging behind compared to the US and China), and geopolitics (few natural resources). The report ‘The future of European competitiveness’ (Draghi, 2024) reaches similar conclusions: the EU is not innovative enough and the US and China are more competitive and their economies are growing faster. One other point is made: the process of passing new EU legislation takes 19 months on average. And in some areas, such as foreign policy, defence, EU expansion, finance, and treaty changes, EU member states can obstruct change by exercising their right of veto (Hollander, 2024).

At least with regard to reducing dependence on critical materials from other regions, such as China, European ambitions are high, with the adoption of the Critical Raw Materials Act (European Commission, 2025b), while the EU is also aiming high with ReArm Europe (European Commission, 2025c). The establishment of a European defence industry could be a new step for the EU (Zandee, 2025), and the same applies to initiatives to make the EU less bureaucratic in adopting qualified majority voting on important decisions (Csaky & Grant, 2025). Perfecting the as-yet imperfect internal market may also enhance prosperity (Beunderman, 2025). Finally, the EU’s sustainability agenda is more competitive in the long term than a policy based on fossil fuels, as currently pursued by the US. In line with that agenda, the initial focus of the Clean Industrial Deal – the successor to the European Green Deal – is on greening Europe’s industry (Boone, 2025).

2.4Trade in military and dual-use goods

Since the Russian invasion of Ukraine in 2022, the global focus on defence expenditure and trade in military goods has increased significantly (SIPRI, 2024). This development is also visible within the European Union, and more specifically in the Netherlands: imports of military goods and so-called dual-use goods – products that can have both civilian and military applications – have risen significantly since then. An example of dual-use goods would be aircraft within certain weight classes. The United States remains globally dominant as a supplier of arms. The country currently has arms contracts divided between over 16 thousand projects worldwide.

These include major European orders, such as the maintenance and assembly of F35 combat aircraft, dozens of which the Netherlands is also purchasing (US Department of State, 2025).

At the same time, awareness is growing within the EU that greater strategic autonomy is needed. Partnerships such as PESCO (Permanent Structured Cooperation, since 2017) and EDF (European Defence Fund, since 2021) are initiatives aimed at strengthening the European defence industry and joint capacities (European Council, 2025; Netherlands Enterprise Agency, 2025). In 2024, the European Commission launched the most recent initiative, ‘ReArm Europe Plan/Readiness 2030’. The objective is to quickly scale up defence investment.

With the help of the new SAFE instrument and by mobilising public and private funding, EU member states aim to make available €800 billion for defence between them (European Commission, 2025a). In spite of these significant steps towards autonomy, various obstacles stand in the way of achieving this ambition. For instance, European partnership projects are often seen as cumbersome and time-consuming, prompting member states to choose individual solutions in the short term. And despite an increase in EU expenditure on R&D for defence, we remain far behind countries like the US and China (EDA, 2025).

From the Cold War to Ukraine: how geopolitics drives defence budgets

Global military expenditure does not follow an arbitrary pattern but reflects the current geopolitical tensions. Following the end of the Cold War, expenditure declined. From 1989 until the late 1990s, global expenditure fell by nearly one-third, from $1,729 billion to $1,183 billion. This decline reversed abruptly in 2001. The 11 September attacks were followed by large-scale military operations in Afghanistan and Iraq. This led to a sustained increase in defence budgets, especially in the US (USAFacts, 2024). Since then, there has been a steady upward trend globally. Partly as a result of the war in Ukraine, global military expenditure reached a record level of $2,677 billion in 2024 (SIPRI, 2025).

This pattern is also visible in Figure 2.4.1, in which we look at the development of military expenditure of the ten countries with the largest defence budgets, plus the Netherlands, in the period from 1993 to 2024. The expenditure is shown in constant US dollars (price level 2024), which means that the figures are adjusted for inflation and are comparable over time. The United States dominates the picture, with a military expenditure that is significantly higher than other countries. In 2024, the US accounted for 37% of global military expenditure. China follows some distance behind, but has seen significant growth in a short period of time and accounted for 12% of the global total in 2024.

Ukraine also stands out in the recent figures. Due to the massive war effort against Russia, the country’s defence expenditure has increased rapidly since 2022. In 2024, it is estimated that Ukraine spent $65 billion on defence activities, over nine times as much as in 2021, representing nearly 35% of GDP. This means that it had the highest defence budget as a share of GDP of any country in the world, due in part to its relatively limited economy. Russia saw defence expenditure rise by 125% in 2024 compared to 2021: from $66 billion in 2021 to $149 billion in 2024, or 7.1% of GDP.

The military expenditures of other European NATO member states, including the United Kingdom, France, Germany and the Netherlands, also display a slight increase in response to the geopolitical tensions caused by the war in Ukraine. However, most member states are still below the current NATO target of 2% (SIPRI, 2025). With $23 billion of defence expenditure, or 1.9% of GDP according to the SIPRI measurement, the Netherlands did not quite meet the target in 2024. Denmark, France, Greece, Finland, Norway, Sweden and the UK were above the NATO target (SIPRI, 2025). On 13 June 2025, the outgoing government, which had fallen earlier that month, announced that the NATO countries had agreed to increase defence expenditure per country to 5% of GDP (NOS, 2025c). Of that 5%, 3.5 percentage points was to consist of direct military expenditure and 1.5 percentage points of indirect expenditure to enhance resilience, for example on cybersecurity and infrastructure, such as bridges suitable for tanks. The proposal is in line with European and national aims to accelerate the resolution of critical capacity bottlenecks. In this way, besides assuring national and European security, the European NATO countries are also helping to strengthen the European pillar of NATO (‘burden shifting’) (NOS, 2025d). Finally, this increases the likelihood of the US remaining in NATO, given that President Trump has repeatedly insisted that the member states should spend more money on defence (The Guardian, 2025).

Show datatable2.4.1 Changes in military expenditure in the ten countries with the highest spending and the Netherlands (billion US dollar)Hide datatable2.4.1 Changes in military expenditure in the ten countries with the highest spending and the Netherlands (billion US dollar)

2.4.1 Changes in military expenditure in the ten countries with the highest spending and the Netherlands (billion US dollar)

Year	US	China	Russia	Germany	India	UK	Saudi-Arabia	Ukraine	France	Japan	Netherlands
1993	316.7	12.4	7.8	34.9	8.3	38.1	16.5	0.2	35.8	41.4	7.1
1994	308.1	9.9	13.5	34.0	8.9	38.6	14.3	0.9	37.3	45.3	7.1
1995	295.9	12.4	12.7	38.6	9.8	38.3	13.2	1.0	40.1	50.0	8.0
1996	288.0	14.3	15.8	36.5	9.9	38.6	13.3	1.5	39.0	44.0	7.8
1997	293.2	15.7	17.6	31.1	11.5	39.9	18.1	2.1	34.7	40.6	6.8
1998	291.0	17.0	8.0	31.1	11.9	41.2	20.9	1.4	33.6	37.8	6.8
1999	298.1	20.5	6.5	30.5	13.9	40.8	18.3	0.9	32.7	43.1	7.0
2000	320.1	22.2	9.2	26.4	14.3	39.3	20.0	1.1	28.4	45.5	6.0
2001	331.8	26.6	11.7	25.7	14.6	39.5	21.0	1.1	28.0	40.8	6.2
2002	378.5	30.3	13.9	27.5	14.7	44.2	18.5	1.2	30.6	39.3	6.7
2003	440.5	33.1	17.0	32.8	16.3	52.3	18.7	1.4	38.6	42.5	8.4
2004	493.0	37.9	21.0	35.6	20.2	60.3	20.9	1.7	44.5	45.3	9.4
2005	533.2	42.8	27.3	35.7	23.1	61.7	25.4	2.4	44.4	44.3	9.6
2006	558.3	51.5	34.5	35.9	24.0	64.2	29.6	3.0	45.8	41.6	10.2
2007	589.6	62.1	43.5	40.1	28.3	73.4	35.5	4.1	50.7	40.5	11.5
2008	656.8	78.8	56.2	45.1	33.0	72.9	38.2	4.8	55.4	46.4	12.4
2009	705.9	96.6	51.5	44.5	38.7	64.0	41.3	3.5	56.4	51.5	12.1
2010	738.0	105.5	58.7	43.0	46.1	64.0	45.2	3.7	52.0	54.7	11.2
2011	752.3	125.3	70.2	45.2	49.6	66.6	48.5	3.7	54.1	60.8	11.6
2012	725.2	145.1	81.5	43.8	47.2	65.5	56.5	4.1	50.2	60.0	10.4
2013	679.2	164.1	88.4	44.2	47.4	63.8	67.0	4.4	52.0	49.0	10.2
2014	647.8	182.1	84.7	44.7	50.9	67.0	80.8	4.0	53.1	46.9	10.3
2015	633.8	196.5	66.4	38.2	51.3	60.0	87.2	3.5	45.6	42.1	8.7
2016	639.9	198.5	69.2	39.9	56.6	53.3	63.7	3.4	45.7	46.5	9.1
2017	646.8	210.4	66.9	42.3	64.6	52.1	70.4	3.6	47.6	45.1	9.6
2018	682.5	232.5	61.6	46.5	66.3	55.8	74.6	4.8	51.3	48.5	11.1
2019	734.3	240.3	65.2	49.1	71.5	56.6	65.4	6.3	50.5	50.8	12.0
2020	778.4	258.0	61.7	53.3	72.9	58.3	64.6	6.8	53.4	51.4	13.1
2021	806.2	285.9	65.9	56.5	76.3	65.1	63.2	6.9	58.7	53.6	14.4
2022	860.7	292.0	102.4	56.2	80.0	64.1	70.9	41.2	54.7	43.2	13.6
2023	916.0	296.8	109.2	67.3	82.3	75.3	77.8	64.9	59.5	48.2	16.6
2024	997.3	313.7	149.0	88.5	86.1	81.8	80.3	64.7	64.7	55.3	23.2
Source: SIPRI (2025)

Import value more than doubled in 2024 compared to 2022

Figure 2.4.2 shows the Dutch import and export value of military goods between 2019 and 2024. In 2023 and 2024, the trade in military goods was substantially higher than in the years before. In 2024, €580.8 million worth of military goods were imported, while the export value was €346 million. Only a small proportion of those imports were directly destined for other countries. With a growth of 63.6%, exports of military goods in particular increased relative to 2023. Import value had already increased sharply the previous year, growing by 87.6% compared to 2022. The higher export value was mainly attributable to motorised combat vehicles and components: the export value of these goods was €127 million higher than in 2023, accounting for 94.4% of total growth.

In recent years, the Netherlands has consistently had a negative trade balance in military goods. Between 2019 and 2022, that deficit contracted each year to approach parity between import and export values. However, this trend was interrupted in 2023 due to the sharp growth in imports, resulting in a record trade deficit in these goods of €302.8 million. Due to the increased export value in 2024, the deficit did fall back to €234.7 million. These figures do not include quasi-transit trade, which has been rare in these goods in recent years. Conversely, re-exports were common: between 2019 and 2024, the share of re-exports stood at between 59% and 74%.

Show datatable2.4.2 Trade in military goods (million euros)Hide datatable2.4.2 Trade in military goods (million euros)

2.4.2 Trade in military goods (million euros)

Jaar	Imports	Exports
2019	307.35	83.47
2020	345.20	150.55
2021	329.48	175.81
2022	274.06	179.90
2023*	514.27	211.47
2024*	580.75	346.01

In the first quarter of 2025, Dutch imports of military goods totalled €148 billion. That was the highest of all the first quarters since the current measurement began in 2015. Exports of these goods also reached a record high of €79 million. This means that exports in the first quarter of 2025 were nearly as high as in the whole of 2019.

Germany is by far the most important country of origin for Dutch imports of military goods

Figure 2.4.3 shows the shares of Dutch imports of military goods per country of origin in 2024. As for many other goods, Germany is by far the most important country of origin for military goods. With an import value of €234.7 million, the country’s share was 40.4% in 2024. At 8.6%, the second-largest country of origin, Sweden, had little more than a fifth of that share. This put the Scandinavian country ahead of the US and Switzerland – the second and third most important countries of origin for military goods in 2023, respectively. That increase is primarily attributable to a growth in import value compared to 2023: imports from Sweden were worth €16.4 million more, comprising mainly motorised combat vehicles and components.

The Netherlands also imported military goods worth €31 million from Israel in 2024; more than 100 times as much as the previous year. According to a letter from the House of Representatives (2024), this relates to an order of Israeli Spike LR2 rockets.

Show datatable2.4.3 Import value of military goods, by country, 2024*Hide datatable2.4.3 Import value of military goods, by country, 2024*

2.4.3 Import value of military goods, by country, 2024*

Country	Import value
Germany	234.71
Sweden	49.97
US	44.32
Israel	31.34
Belgium	30.52
Other	190.71

Also in 2024, the Netherlands imported €33.4 million less in military goods from the US, of which 54% was accounted for by reduced imports of weapon components. Additionally, the value of bombs, shells, torpedoes, mines, rockets and other projectiles imported was down by €14.9 million.

Finally, over a third of military imports in the first quarter of 2025 came from Germany. Brazil, the US, Israel and Sweden each had an 8% share. Brazil is the only country that did not feature in the top 5 main import partners in 2024. This South American country is an important trading partner for cartridges; nearly a quarter of the cartridges imported between 2019 and the first quarter of 2025 came from Brazil. Cartridges accounted for almost the entire import value from Brazil.

Imports in 2024 consisted mainly of combat vehicles and ammunition

Figure 2.4.4 shows the main military goods imported in 2024. Motorised combat vehicles and components were imported the most, at a value of €189.8 million. That was €60.1 million more than the previous year. Despite the fact that the import value of Swedish motorised combat vehicles and components grew by 51.3% compared to 2023, these goods were primarily sourced from Germany, with an import value of €99.8 million.

In addition, ammunition was imported at a value of €155.9 million – a fall of €15.9 million compared to 2023. Germany was also the most important country of origin for these goods, with a share of 46.3%. In 2023, ammunition was still relatively likely to be obtained from Switzerland, Czechia, the US, and Italy. A year later, their share had shrunk significantly; the import value of ammunition from Switzerland, Czechia and the US contracted by 64%, 89% and 79%, respectively. For Italy, a contraction of 98% means that there were almost no imports of weapons and ammunition from that country in 2024. The contractions for Switzerland, the US and Italy went hand in hand with the shift to Israel as a country of origin for imports of bombs, shells, torpedoes, mines, rockets and other projectiles. The import value of weapons and ammunition from Israel was €30.5 million, accounting for a 20% share.

Show datatable2.4.4 Imports of military goods, 2024* (milion euros)Hide datatable2.4.4 Imports of military goods, 2024* (milion euros)

2.4.4 Imports of military goods, 2024* (milion euros)

Militair goed	2024*
Motorised combat vehicles and components	189.8
Weapons and ammunition	155.9
Other cartridges and parts thereof	80.4
Weapon components	71.9
Other	82.8

Additionally, €80.4 million worth of other cartridges and parts thereof were imported. Of those, Germany and Brazil supplied one-third each. The €71.9 million in imports of weapons components in 2024 came largely from Germany, Luxembourg (both 21%), the US (15%), and Belgium (13%).

The three most imported goods remained unchanged in the first quarter of 2025 compared to the whole of 2024. This means that motorised combat vehicles and components were the most imported goods, with an import value of €50.7 million. In addition, weapons and ammunition were imported at a value of €33.9 million. The top 3 for the first quarter of 2025 were again completed by other cartridges and parts thereof. The proportion, however, changed slightly, with the latter gaining slightly in importance compared to the other two.

In 2024, over a third of exports of military goods consisted of motorised combat vehicles and components.

Figure 2.4.5 shows the military goods most exported by the Netherlands in 2024.

As with imports, the largest share was accounted for by motorised combat vehicles and components, with an export value of €209.1 million. That was 60.4% of the total export value of military goods. Half of those goods were purchased by Sweden, followed by Germany, which accounted for a third of export value. In addition, weapons and ammunition worth €84.7 million was exported, three-quarters of which went to Luxembourg. Of both goods types, 80% were re-exported.

The top 4 of the military goods most exported by the Netherlands was completed by weapon components and military weapons, with export values of €19.5 million and €17.4 million, respectively. Dutch weapon components were primarily exported to the US; 77% of these goods had the US as their destination. Of the exported military weapons, 85% went to Norway. Rocket launchers, flame throwers, grenade launchers and missile tubes made up 87% of the exports of military weapons. Domestic production accounted for the bulk of military weapons and weapon components.

Exports of motorised combat vehicles and components to Sweden made this Scandinavian country the most popular destination for Dutch military goods: 30% of export value went to Sweden. It was followed by Germany (20%) and Luxembourg (19%).

Show datatable2.4.5 Exports of military goods, 2024* (million euros)Hide datatable2.4.5 Exports of military goods, 2024* (million euros)

2.4.5 Exports of military goods, 2024* (million euros)

Waarden	Export value
Motorised combat vehicles and components	209.1
Weapons and ammunition	84.7
Weapon components	19.5
Military weapons	17.4
Other	15.4

In the first quarter of 2025, exports were again dominated by motorised combat vehicles and components; with an export value of €58.6 million, three-quarters of exports consisted of these goods. Just as in 2024, the top 3 were completed by exports of weapons and ammunition (9%) and weapon components (6%).

Trade in dual-use goods increased to record levels in 2022, but the Netherlands and EU tighten supervision

Some goods – so-called dual-use goods – can have both civilian and military applications. Examples include drones, but also aircraft, because there is no specific code for fighter jets. The trade in these dual-use goods is strictly regulated. For instance, EU member states are bound by regulation 2021/821 (European Union, 2021), which requires that exporting dealers must in many cases be in possession of a licence to export these goods outside the EU (this requirement does not apply to exports to EU countries). Due to increased geopolitical tensions, dual-use goods are becoming subject to even tighter controls. In 2024 and early 2025, we saw a clear trend within the EU and individual member states for the tightening of export rules by means of sanctions (European Council, 2024; Rijksoverheid, 2025). Thus, in late 2024, the EU imposed a ban on exports of goods that can be used for the production of rockets and UAVs (‘unmanned aerial vehicles’) to Iran. It is also no longer permitted to trade with ports and locks controlled by sanctioned parties, as is the case for the port of Amirabad. This prohibition was introduced due to the military support provided by Iran to Russia and several militant groups in the Middle East (European Council, 2024).

Show datatable2.4.6 Trade value of dual-use goods (billion euros)Hide datatable2.4.6 Trade value of dual-use goods (billion euros)

2.4.6 Trade value of dual-use goods (billion euros)

Jaar	Exports	Imports
2019	142	112
2020	130	106
2021	157	127
2022	228	201
2023*	224	188
2024*	222	184

Between 2019 and 2024, Dutch trade in dual-use goods increased substantially on both the export and the import side, with a clear peak in 2022 and a slight decline thereafter, as shown in Figure 2.4.6. Whereas in 2019, exports still stood at around €142 billion, in 2022 export value peaked at over €228 billion. For both imports and exports of dual-use goods, half the increase between 2019 and 2024 was attributable to the trade in machinery and equipment. In particular, exports of chip manufacturing equipment increased, to a value of €10 billion. However, that increase is not unique to dual-use goods; the import and export values of other goods also reached a peak in 2022. This reflects the fact that inflation stood at 10% in 2022, according to the consumer price index (CBS, 2023c). Export value stabilised from 2023. As is the case for the global goods trade, the balance between supply and demand for dual-use goods appears to be improving, helping to level out the peaks in inflation seen in 2022 (UNCTAD, 2024a).

Imports followed a similar pattern, achieving a relatively stable level in 2019 and 2020, followed by a sharp increase, with a peak in 2022. Compared to 2019, the import value of dual-use goods was 80% higher in 2022: from €112 billion in 2019 to €201 billion in 2022. The trade in dual-use goods made up around 30% of both imports and exports between 2019 and 2024.

Germany continues to be the main export destination for dual-use goods, and the US the most important country of origin

Germany, Belgium, the US and France are the four main destinations for Dutch exports of dual-use goods. Figure 2.4.7 shows the trade flows between the Netherlands and the ten most important export partners broken down by domestic exports, re-exports and imports.

Germany is by far the most important export partner. In 2024, the Netherlands exported dual-use goods worth €36.7 billion to Germany – €14.0 billion in domestic exports and €22.7 billion in re-exports. However, that share fell compared to 2023: from 18.4% in 2023 to 17.5% in 2024. Besides Germany, France’s share also displays a slight fall, by 0.1 percentage point in 2024 compared to 2023. The shares of the other countries in the top 5 all increased over the same period: China rose the most, at 1.5 percentage points, removing the UK from the top 5. If we exclude re-exports, the US is the Netherlands’ most important export partner. In 2024, the Netherlands exported goods worth €19.3 billion to the US, of which €14.6 billion were domestic exports. This means that the US overtook Germany as the main destination for domestic exports. These mainly included machinery and equipment (45%) and mineral fuels (26%) – in particular, chip manufacturing equipment and refined petroleum products.

Show datatable2.4.7 Top 10 export partners for Dutch trade in dual-use goods, 2024* (billion euros)Hide datatable2.4.7 Top 10 export partners for Dutch trade in dual-use goods, 2024* (billion euros)

2.4.7 Top 10 export partners for Dutch trade in dual-use goods, 2024* (billion euros)

Land	Categorie	Domestic exports	Re-exports	Imports
Germany	Exports, Germany	14	22.7	.
Germany	Imports, Germany	.	.	26.1
Belgium	Exports, Belgium	9.8	9.7	.
Belgium	Imports, Belgium	.	.	12.8
US	Exports, US	14.6	4.7	.
US	Imports, US	.	.	26.6
France	Exports, France	4.1	9.8	.
France	Imports, France	.	.	4.6
China	Exports, China	11.6	1.4	.
China	Imports, China	.	.	25.5
UK	Exports, UK	6.3	6.6	.
UK	Imports, UK	.	.	10.2
Italiy	Exports, Italiy	1.9	5.5	.
Italiy	Imports, Italiy	.	.	3.4
South Korea	Exports, South Korea	6.9	0.5	.
South Korea	Imports, South Korea	.	.	2.1
Spain	Exports, Spain	1.9	4.6	.
Spain	Imports, Spain	.	.	2.3
Poland	Exports, Poland	1.4	3.7	.
Poland	Imports, Poland	.	.	3.4

The Netherlands actually imported more dual-use goods from the US and China than it exported to those countries. In 2024, we imported dual-use goods worth €26.6 billion from the US, €4 billion less than the year before. As a result, the share of dual-use goods obtained from the US dropped to 14% in 2024. We also imported less from Germany and China, who form the rest of the top 3: imports from Germany fell by 3% and we sourced 2% fewer dual-use goods from China. Both countries accounted for 14% of total imports of dual-use goods. In 2024, machinery and equipment was the most important category for imports of dual-use goods (56%), as was the case for exports.

2.5Annex

Explanatory notes on international indices

Economics

• Logistics Performance Index. This index of the World Bank measures how quickly and reliably countries deliver goods. It specifically looks at the ease of setting up reliable value chains and the factors that facilitate this, such as the quality of logistics services, infrastructure for trade and transport and border controls (World Bank, 2025d).
• Global Quality Infrastructure Index. This index of Mesopartner and Analyticar looks at the international system of metrology, standardisation, accreditation and quality-focused services (such as inspection) that generates trust in international trade and contributes to the protection of people and the environment (Mesopartner & Analyticar, 2023).
• Entrepreneurship Index. This ranking is part of the ‘best countries’ ranking of US News, WPP and the University of Philadelphia. The index shows which countries are most attractive to entrepreneurs, based on eleven factors: connection with the rest of the world, education of the population, entrepreneurship, innovation, access to finance, work skills, transparency of business operations, physical infrastructure, digital infrastructure and legal framework (US News et al., 2025).
• Open for Business Index. This ranking is part of the ‘best countries’ ranking of US News, WPP and the University of Philadelphia. The Open for Business Index measures which countries represent the most attractive locations for companies, based on five factors: bureaucracy, production costs, corruption, tax environment and transparency of government (US News et al., 2025).

Innovation

• Global Innovation Index. This index of the WIPO (World Intellectual Property Organisation), a United Nations agency, ranks the most innovative countries of the world and looks at both innovation input (institutions, human capital, infrastructure, functioning of the market and functioning of companies) and innovation output (knowledge, technology, creative goods and services) (WIPO, 2024).
• Global Talent Competitiveness Index. This index of the INSEAD Business School, the Descartes Institute for the Future and the Human Capital Leadership Institute measures countries’ ability to develop, attract and retain talent (INSEAD, 2023).
• World Digital Competitiveness Index. This index of the IMD Business School measures the capacity and readiness of economies to adopt and explore digital technology for social transitions (IMD, 2024).

Quality of life

• Global Gender Gap Index. This index of the World Economic Forum takes an annual look at the level and development of inclusiveness, specifically in the fields of economic participation and opportunities, education, health and survival, and political empowerment (WEF, 2024).
• Human Development Index (HDI). The HDI is put together by the development programme of the United Nations (UNDP) and shows performance in the areas of a long and healthy life (life expectancy at birth), a skilled life (years of school education) and a sufficiently prosperous life (per capita income) (UNDP, 2025).
• Inequality adjusted HDI. This is the HDI corrected for income inequality per country (UNDP, 2025).
• World Happiness Report. This annual report by Oxford University, Gallup and the United Nations reveals the perceptions of each country’s own population in terms of social support, prosperity, health, freedom, generosity, and corruption. It looks at the emotions and goodwill of the population itself separately (WHR, 2025).
• Democracy Index. This index of The Economist measures the state of democracy in nearly all the world’s countries, based on research into electoral processes, public administration, political participation, political culture, and civil liberties (EIU, 2025).
• Word Press Freedom Index. This index by Reporters without borders (RSF – Reporters sans Frontières) shows which countries have the greatest press freedom. The scores are based on quantitative analyses (unlawful acts against journalists) and qualitative analyses (questionnaires) (RSF, 2025).
• Social Progress Index. This index of Social Progress Imperative and AlTi Tiedemann Global measures the extent to which countries meet their citizens’ social and ecological needs. The relative performance of nations is revealed by 54 indicators of fundamental human needs, fundamentals of wellbeing and opportunities for progress (SPI, 2025).
• Worldwide Governance indicators. These data of the World Bank are based on sources from more than 30 think tanks, international organisations, NGOs and private companies and measure the extent of good governance of countries – an important factor for economic growth, education and social cohesion (World Bank, 2025i).
• Corruption Perception Index. This index of Transparency International scores nearly every country of the world in terms of corruption in the public sector, based on the perception of experts, businesspeople and 13 independent data sources (Transparency, 2025).

Sustainability

• Sustainable Development Goals Report. This annual report by the United Nations shows countries’ progress on achieving the Sustainable Development Goals (UN, 2025).
• Environmental Performance Index. This index of Yale and other US universities measures global sustainability ambitions based on 58 indicators. It looks at ambitions for combating climate change, keeping the environment healthy, and maintaining the vitality of ecosystems (Block et al., 2024).
• Climate Change Performance Index. This index of various research institutions in Germany (Germanwatch, New Climate Institute, Climate Action Network International) looks at countries’ actual performance in combating climate change (Burck et al., 2025).

Geopolitics

• Power Index. This ranking is part of the ‘best countries’ ranking of US News, WPP and the University of Philadelphia. The index shows which countries dominate in geopolitical terms and have an influence on the world stage, based on six factors: leadership, economic influence, exports, political influence, international alliances, and military power (US News et al., 2025).
• Global Fire Power Index. This index of the organisation of the same name measures the number of military units per country, looks at financial and logistics capacities and geographical advantages and translates them into military power (GFP, 2025).

2.6References

Open references