The war in Iran is slowing down economic growth across all sectors in the Netherlands. After looking at three possible outcomes, Rabobank warns that the manufacturing, building, and transport industries will be hit hardest, though much depends on how long the fighting lasts.
In the first version of events, the war lasts only a few weeks. Even so, growth in manufacturing would drop from 2% to 1.6% this year. The building industry would also see growth fall below 1%, as these sectors are very sensitive to rising energy costs.
Things could get much worse if the war drags on and oil prices spike to $110 or even $150 per barrel. In the worst-case scenario, growth in manufacturing would almost stop, the building sector would see no growth at all, and the transport industry would actually shrink. Materials like glass, aluminium, and ceramics would become much more expensive to produce and move.
It isn’t just businesses feeling the pinch; shoppers are likely to become more careful with their money too. This will hurt shops, restaurants, and travel agents. While IT companies might be okay for now, they could suffer if other businesses delay big projects due to the uncertainty.
The healthcare sector is expected to be the least affected. Because the population is ageing, the demand for care remains high regardless of the economy. For this sector, the government’s specific healthcare plans will matter more than the price of oil.
@anp | NEWS BRAINPORT
