Fewer bankruptcies in the Netherlands than average in the EU: ‘Corona support measures have worked’ | Economy

Especially during the corona crisis, bankruptcies in the Netherlands and the EU developed in different directions. In the Netherlands, the number of companies going bankrupt fell to an all-time low, while the number in the EU increased. In the second quarter of 2020, the number of bankruptcies in both the Netherlands and the EU was still around 60 percent of the 2015 level.

According to chief economist Peter Hein van Mulligen, this can mainly be explained by the differences in government support measures in Europe: “The Dutch government’s support measures were intended to prevent bankruptcies and thus job losses. That apparently worked. According to some economists, it even worked out a little too well, because non-viable companies could also survive thanks to the measures. But now that the measures have ended, the number of bankruptcies is still low. This is mainly because the Dutch economy is doing very well. Also before corona, but especially during corona, the Dutch economy performed much better than in other European countries.

The development of the number of bankruptcies in the hospitality industry in particular deviated from the European average in the corona years. While the number of bankruptcies in the Netherlands first increased among hotels, restaurants and cafés, to over 156 percent of the 2015 level in the second quarter of 2020, it then started to decline. In contrast, for the EU as a whole, the level of insolvency in the on-trade declined first, before increasing for several quarters.

Mulligen does point out the differences between the southern European countries and the northern ones. “Countries such as Spain and Italy rely much more on the catering industry for their economy than here. Especially in the summer months. As a result, the impact there was also much greater.”

In the Netherlands, the number of bankruptcies increased faster than the EU average in the first quarter of 2023. There were 7 percent more Dutch companies going bankrupt compared to the previous quarter. For the EU as a whole, 3 percent more companies went bankrupt in that period. At the end of 2022, the Netherlands also experienced a faster increase (+23 percent) than neighboring countries. In France (+8 percent) and Belgium (+4 percent), the number of bankruptcies also increased faster than the average in Europe in the first three months of 2023. In Spain, the number of bankruptcies decreased.

In the last five quarters, the number of bankruptcies in the Netherlands and the EU again showed the same trend. During that period, the number of companies going bankrupt increased every quarter. In the manufacturing sector, the number of bankruptcies in both the Netherlands and the EU in the first quarter of 2023 was approximately 75 percent of the 2015 level. In all other industries, the number of bankruptcies in the Netherlands was lower than the EU average .

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