International Business Climate In The Netherlands

The Netherlands

The New Frontier for International Business

Amanda L. Pearce I B 303 Spring 2005 April 14, 2005 The kingdom of the Netherlands is composed of the Netherlands, Aruba, and Netherlands Antilles. The official languages of the Netherlands are Dutch and Frisian; however, many members of the country are able to speak English. The Netherlands is a member of the European Union and a member of NATO and has long been considered to be one of the emerging marketplaces for international business. This international business home is in a city called Hague, which is also the capital of the country. The Hague has been called the "legal capital of the world," "the city of peace and justice," and has been the site of many major peace meetings. The United Nations holds meeting there. Awards have been established solely to credit this city for its contributions to peace. The Hague is not only known for its legal recognition, though, it is also known for its beautiful architecture and city life. (www.thehague.nl)

Throughout the Hague, there are museums, galleries, and theaters. The city is home to more than twenty museums, has eleven performing arts theaters, and many different sources of music. These cultural attributes make the Hague an attractive city to visit while touring Europe. A strong nightlife in the Hague attracts many students and young adults in their travels. Salsa dancing and discos are a strong force in the Hague. Many night clubs and bars can be found on the main streets of the Hague, along with a few casinos (www.thehague.nl).

The Hague is an incredibly strong asset to international business. Many international schools can be found in the Hague, and with a constant influx of international businesses, plenty of opportunities for employment are becoming available. For any person intending to tour Europe, the Hague is a must-see stop along the way (www.thehague.nl)

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Exports

Exporting goods to another nation creates an increase in wealth in the home country. The Netherlands exports many of their natural resources to their neighboring nations and fellow European Union members. The major exporting partners of the Netherlands are Germany, Belgium, France, the UK, Italy, and the United States. These countries account for over 65 percent of the nation's exports of food products, chemical and energy products, and machinery and equipment, respectively.

Machinery and equipment are one of the major exports of the Netherlands. Agricultural, metal, engineering, and electrical equipment are some of the products that the Netherlands exports. It is obvious that machinery and equipment are large, expensive investments, likely generating a great deal of wealth for the country (World Fact Book).

The Netherlands is a large producer of energy products, which is the reasoning behind the fact that some of the major exports from the Netherlands are energy-related (World Fact Book). The Netherlands sends out a portion of the electricity, natural gas, and oil; however, the country also has a strong exportation of their local commodities. The Netherlands also exports chemicals to other countries. "Over 80 percent of the chemicals produced in the Netherlands is sold outside this country," (www.netherlandsembassy.ph). The Netherlands is shifting their chemical focus from petroleum-based chemicals towards fine chemicals and biotechnology. The Netherlands chemical production is the second-strongest industry in the country, right behind food products.

The strongest manufacturing industry in the Netherlands is the production of food products. The Dutch grow vegetable products, breeding and forestry, and farm supplies, such as seeds, fertilizers, and cattle food (www.interexlebanon.com). This industry is often the strongest in many nations. Because of the Netherlands geographical area, climate, and other physical qualities, it is in an ideal global position to produce all types of farm products.

Imports

The import partners of the Netherlands are slightly different from their export partners. A country must import from a nation that has what they need, and if all the nations the country exports to cannot provide the Netherlands with the products they need, they will have to import from others. The Netherland's import partners are Germany, Belgium, the United States, the UK, China, and France, accounting for just over 50 percent of the nations imports (World Fact Book). From these countries, the Dutch import "machinery and transport equipment, chemicals, fuels, foodstuffs, and clothing (World Fact Book).

The Netherlands is not a large producer of clothes; therefore, they must import their clothes from a country who can produce the clothes in the quantities the Dutch require. It is likely that the clothing is imported from China, where production is much less expensive than many other nations (Lecture). American styles often infiltrate European countries, so it is likely that some of the clothing imported to the Netherlands is produced in the United States.

A country can usually never produce all of the food that its inhabitants consume. Usually, undeveloped nations are the only nations that can grow and eat everything they consume. The Dutch are a highly developed nation and require a high level of food to be imported to feed the country's members. The country imports cereals, meat products, vegetables, coffee, tea, cocoa, and other products (www.cbs.nl).

The country must import a great deal of chemicals in order to produce the amount of higher-level chemicals that the Dutch produce. The Netherlands creates many petroleum-based products and must import the chemicals needed to refine crude oil. These imports are incredibly important to the Netherlands status in the world as a large energy industry (World Fact Book).

4 FORCES

Geographic

The physical characteristics of the Netherlands make it an ideal place for international business to prosper. The Netherlands is bordered by the North Sea, Belgium, and Germany and is primarily coastal lowlands.

Climate determines what those who inhabit a country can do both physically and economically. The World Factbook