Economic Outlook 2004-2007
The annual GDP-growth in the period 2004-2007 in the so-called prudent growth scenario is 2¼%, ½%-point less than in the previous outlook (CPB Document 22) for the period 2003-2006. Reasons for the adjustment are ageing of the population, less immigration, an increase in equilibrium unemployment rate due to increased old age pension premiums and a reduction in the structural growth of labour productivity. The latter is in line with an international trend of lower productivitey growth estimates.
The government financial balance (EMU-balance) deteriorates significantly from 0.6% GDP in 2006 in the previous outlook to -1.5% GDP in the current one, whick amounts to a reduction of 10 billion euro. The main reason for the adjustment is the reduction in GDP-growth for both the period 2004-2006 and the years 2002 and 2003. The lower level of GDP implies substantially lower tax and premium receipts for the government. In addition the expenditures on unemployment benefits and interest on government debt increase significantly. In 2007 the financial balance improves to -1.1% GDP due to an increase in tax receipts.
The publication is in Dutch.