Consumer Debt:
Some countries in the eurozone are struggling with large budget deficits and national debts. These problems have created unsettled financial markets and investors loosing trust in the eurozone. The Dutch economy is based on exports, therefore if other countries across Europe are in financial recession the Netherlands will suffer. It is crucial for the Netherlands that countries in the eurozone are able to fix their economic problems before they crucially impact the Netherlands for the worse.
Solutions:
There are three effective solutions that can help fix the debt problem on a short term and long term basis to prevent any further damages to eurozone economies.
1. Tighter budgetary rules and discipline must be used to guard long term stability in the eurozone to prevent a new debt crisis. EU (European Union) countries have tightened their rules to prevent another repeat of the debt crisis on the Treaty of Stability, Coordination and Governance in the Economic and Monetary Union.
2. Countries with financial problems must put finances and economy in order. This means creating major reforms, cutting back, or creating economic action plans to fix budget deficits. Almost all EU members have budget deficits that need to be dealt with accordingly.
3. Countries that are unable to meet their debt repayment plans must seek assistance from European rescue funds.
Some countries in the eurozone are struggling with large budget deficits and national debts. These problems have created unsettled financial markets and investors loosing trust in the eurozone. The Dutch economy is based on exports, therefore if other countries across Europe are in financial recession the Netherlands will suffer. It is crucial for the Netherlands that countries in the eurozone are able to fix their economic problems before they crucially impact the Netherlands for the worse.
Solutions:
There are three effective solutions that can help fix the debt problem on a short term and long term basis to prevent any further damages to eurozone economies.
1. Tighter budgetary rules and discipline must be used to guard long term stability in the eurozone to prevent a new debt crisis. EU (European Union) countries have tightened their rules to prevent another repeat of the debt crisis on the Treaty of Stability, Coordination and Governance in the Economic and Monetary Union.
2. Countries with financial problems must put finances and economy in order. This means creating major reforms, cutting back, or creating economic action plans to fix budget deficits. Almost all EU members have budget deficits that need to be dealt with accordingly.
3. Countries that are unable to meet their debt repayment plans must seek assistance from European rescue funds.
Aging Population
Population growth is slowing down in the Netherlands, as it is in many countries in the West. This has now created an ageing population of citizens over 65. This will mean there will be a larger demand for pensions and less people physically capable to fill the labor force.
Population growth is slowing down in the Netherlands, as it is in many countries in the West. This has now created an ageing population of citizens over 65. This will mean there will be a larger demand for pensions and less people physically capable to fill the labor force.
Solutions:
1. Incentives for early retirement need to be reduced. Also, eligibility for disability insurance needs to be more strictly enforced as it is often used as a way to retire early- today about 20% of the population aged 55-64 uses a disability relief benefits.
2. The Netherlands government will need to start saving in their budget for this rise in age related budget costs. By starting to save now for the boom expected to start in 2050, the Netherlands will avoid financial devastation from the large amount of age related problems.
3. The government should end thee practice of providing automatic legal extensions on pensions to all employees in any industrial sector.
1. Incentives for early retirement need to be reduced. Also, eligibility for disability insurance needs to be more strictly enforced as it is often used as a way to retire early- today about 20% of the population aged 55-64 uses a disability relief benefits.
2. The Netherlands government will need to start saving in their budget for this rise in age related budget costs. By starting to save now for the boom expected to start in 2050, the Netherlands will avoid financial devastation from the large amount of age related problems.
3. The government should end thee practice of providing automatic legal extensions on pensions to all employees in any industrial sector.
Business Lending Weak:
September 2013, banks in the Netherlands had nearly 6 billion euros less in outstanding corporate loans than in August. Business lending is down 1.3%.
Solutions:
1. Offer lower interest rates to citizens wanting to create their own start-up company.
2. Create lose requirements for loans in personal businesses. By doing this it will encourage Dutch citizens to start their own business, with start up money to do so.
3. Create incentive programs for start up companies. Rather lower interest rates, create promotions and tax reductions on business start up companies for allotted periods of time so that individuals will invest in their businesses.
4. Have the government create Hiring Credit for small businesses to hire and expand their companies.
September 2013, banks in the Netherlands had nearly 6 billion euros less in outstanding corporate loans than in August. Business lending is down 1.3%.
Solutions:
1. Offer lower interest rates to citizens wanting to create their own start-up company.
2. Create lose requirements for loans in personal businesses. By doing this it will encourage Dutch citizens to start their own business, with start up money to do so.
3. Create incentive programs for start up companies. Rather lower interest rates, create promotions and tax reductions on business start up companies for allotted periods of time so that individuals will invest in their businesses.
4. Have the government create Hiring Credit for small businesses to hire and expand their companies.