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Highly focused R&D spending
There are only a limited number of industrial sectors that invest heavily in Research & Development (R&D). To make Dutch industry future-proof, it is important that this takes place across the board, with a clear focus on what industry in the Netherlands is good at and what the world will need in the longer term.
With an average growth rate of 2.1% (2013-2021), Dutch industry is starting from a relatively favourable position. It is exceeding the average annual growth rate of 1.5% for the Dutch economy as a whole. The big challenge now is continuing this growth in a rapidly changing and unpredictable world and, in particular, to make sure the focus is not just on economic results, but also on the contribution to well-being in our country.
Making Dutch manufacturing companies and factories more sustainable
The focus on well-being really could be a game-changer. To combat further global warming, for example, Dutch industry needs to switch into full innovation mode. This is the only way for manufacturing companies and factories in the Netherlands to make their production methods and products more sustainable.
Industry can also play a key role in making the Netherlands and Europe less vulnerable to disruptions to global chains. Such a strong industrial base will also help our country obtain greater strategic autonomy, for example over critical raw materials.
Given the current geopolitical environment, that is an important condition for safeguarding our earning capacity over the longer term too. However, that does not mean the Netherlands should cut itself off from other countries. On the contrary, a small country like ours actually benefits from good international cooperation and strategic alliances with countries in Europe and beyond.
Small country, big choices
What does this mean in concrete terms for industry in the Netherlands? It is clear that rapid developments in the world around us are making it harder to see future challenges coming. It is therefore almost inevitable that the transformation of existing industrial processes will reach its limits.
As a small country, we will have big choices to make here. Dutch factories and manufacturing companies will have to move away from old technologies that cannot be transformed without losing value, for example. This does not mean that Dutch factories will be forced to shut down. It means they will be challenged to innovate.
A broad approach to industrial transformation
If Dutch factories and manufacturing companies want to engage in industrial transformation, they face a major challenge over the coming years. To meet this challenge, they can focus on the following aspects:
- Making additional investments in R&D
- Innovating with digital technology wherever possible
- Adapting quickly to new developments
- Looking beyond financial results and contributing to well-being
It is important that this transformation is embraced at all levels: by multinationals, SMEs, and startups.
Increasing Dutch industry’s capacity for change
Having a dot on the horizon to aim for always helps. For Dutch industry, however, it is particularly important to start focusing on innovation and increasing capacity for change today. And that calls for closer cooperation between government, businesses, knowledge institutions, and citizens.
To sum up, when it comes to the future of industry in the Netherlands, as a small country we will have big choices to make. Far-reaching changes are needed.
Thijmen van BreeFunctie:Senior economic researcher and consultantSpecialisatie niet bekend
I am Thijmen van Bree, senior economic researcher and consultant at TNO Vector. As a general/spatial economist I work on foresights, impact analyses and assessments around major societal challenges, transitions and transformations, regional and urban development and societal impact of innovation.
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