Standard export figures conceal economic dependencies
Today, production processes are highly fragmented internationally. As a result, Dutch exports not only consist of Dutch added value, but also of foreign added value. For example, the value exported by a Dutch tyre manufacturer is not equal to the value added by the Dutch economy. That is because tyre production requires the input of imported rubber. Moreover, Dutch exports are not 100% consumed in the country of destination; part of them is transported further to other countries. Standard export figures show the value of a country's exports abroad, but do not provide information on how much the Dutch economy earns from this or where the end user of this Dutch value is located. The latter is important to gain an understanding of the interconnectedness with other economies.
Strong interconnectedness between European economies
European countries trade mainly with each other, with regional value chains playing an important role. On average, 45% of the value a European country adds to its exports of goods and services ends up in another EU country. This means that European economies are strongly interconnected, and this certainly applies to the Netherlands. Figure 1 shows that 51% of Dutch value added in exports ends in the EU, while, for example, less than 40% of British value added in exports ends in Europe. By comparison, the US economy – which is similar in size to that of the European Union – is the second largest sales market for the Netherlands and good for 10% of Dutch value in exports in terms of demand. About 4% of the Dutch added value ends in China.
Figure 1. Percentage of value added in exports to the EU, by country