(MENAFN- The Peninsula)
Reuters
AMSTERDAM: The Netherlands announced plans on Tuesday to spend billions of euros to increase the supply of sustainable energy in the coming year as its economy rebounds strongly from the COVID-19 crisis.
The government's 2022 budget includes up to 7 billion euros ($8.2 billion) in subsidies for sustainable energy projects and other measures to fight climate change, as the country strives to meet environmental goals it has largely missed over the past years.
The climate spending plans are the most striking element of the budget, which leaves many other issues untouched as the government is still in caretaker status, eight months after it was brought down over a childcare subsidies scandal.
Efforts to form a new government have stalled since the last elections in March, in which Prime Minister Mark Rutte's conservative party won the most votes, but not enough to govern without the support of junior partners.
The drawn-out process has hit the general public's faith in political institutions, national polls published this week showed. But it has not hurt the Dutch economy so far, which bounced back more strongly from its coronavirus-induced slump than many of its neighbours in recent months.
The euro zone's fifth largest economy is expected to grow by 3.9% this year and 3.5% next year, following a record contraction of almost 4% in 2020 due to the pandemic.
The economic revival is also visible in the labour market, where companies like bars and restaurants are having trouble finding enough staff to enable them to fully reopen.
Lavish government support helped many companies survive the pandemic and kept unemployment near historic lows, but there are now more job listings than there are people looking for work.
ING chief economist Marieke Blom said the Dutch economy had done much better than expected, but cautioned that the political instability posed risks for the future.
"Pressing problems, such as long-term climate policies, pensions, labour market and housing reforms have not been touched in over a year now," she added. "This creates uncertainty as companies willing to invest in cleaner production technologies and staff don't know what to expect."
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