The Netherlands' net external asset position in 2021 was €181 billion lower than previously estimated. This is according to adjusted balance of payments data published by DNB today. The main reason for the adjustment is that Dutch firms and financial holding companies had higher liabilities abroad than previously estimated.
The publication of these adjusted 2021 figures is the initial product from a more widely-scoped maintenance programme for Dutch macroeconomic statistics (benchmark revision). In line with European policies, DNB and Statistics Netherlands (CBS) carry out such major maintenance every five years to include newly available data sources and to refine methods.
At De Nederlandsche Bank, we independently compile statistics on the Dutch financial sector and economy. This article is based on these statistics. More information on our statistics and all dashboards can be found on our Statistics homepage.
The net external asset position is the balance of all receivables Dutch parties have with parties abroad, and the receivables foreign parties have with Dutch parties. In recent years, the Dutch economy has seen its net claim on the rest of the world increase, due in part to the Netherlands' consistent current account surplus.
Previously, this amount as at 31 December 2021 was estimated at € 813 billion, or 93% of gross domestic product (GDP) for that year. The newly published figures adjust this amount to €632 billion (71% of GDP). While this figure is lower, it is still high from an international perspective. Relative to GDP, the Netherlands also has one of the highest external asset positions (which is also called the international investment position) of the countries in the European Union even after the adjustment.
As the Dutch economy is highly intertwined with other countries financially, large gross amounts underlie this net claim. According to the updated figures, by 2021 the Dutch economy had €9,809 billion in foreign receivables, or about 11 times GDP. Conversely, it had €9,177 in foreign liabilities, about 10.3 times GDP.
The adjustment in the net external asset position is due to better and more comprehensive source data on Dutch firms and financial institutions, which has been incorporated into the balance of payments as part of the maintenance programme.
* excluding special purpose entities, as these institutions have no effect on the adjustment
For instance, Dutch firms and financial institutions appear to have issued more securities, such as shares and debt securities, than previously estimated. A large proportion of these securities are held by foreign investors.
This additional liability to foreign parties is reflected in an adjustment to external assets of € -125 billion. Underlying this, the increase in debt securities issued in particular causes a downward adjustment, which is partially offset by an upward adjustment for net Dutch holdings of shares and other securities.
Within the Dutch economy, the adjustment in securities data mainly concerns non-financial corporations and financial holding companies (captive financial institutions and money lenders, excluding the special purpose entities in this sector). To a lesser extent, the figures for banks and other financial intermediaries have also been adjusted. Incidentally, special purpose entities appear to have issued €108 billion more to foreign parties than previously estimated. However, because these liabilities are offset by foreign assets, this statistical adjustment has no impact on net external assets.
In addition, Dutch firms and financial holding companies appear to have attracted more foreign direct investment than previously estimated. Examples include foreign parent companies providing loans to Dutch subsidiaries. The related adjustment totals € -136 billion. This adjustment is partly offset by €55 billion more in non-captive loans issued by Dutch institutions abroad.
It would appear that the additional loans and securities issued by Dutch financial holding companies were used mainly to finance Dutch firms. An example of such an arrangement is when a Dutch finance company issues bonds in the international capital market on behalf of a Dutch firm.
Today, we publish the most important adjustments for the 2021 balance of payments, while Statistics Netherlands publishes the most important adjustments for the national accounts. The full release of the time series of adjusted balance of payments data will take place on 24 June, accompanied by more detailed explanatory notes discussing the various data adjustments.
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