High energy prices cost the Netherlands 2% of national income

High energy prices in 2021 and 2022 have caused the Netherlands to spend more money abroad than usual, according to the Dutch central bank DNB. Terms of trade losses amounted to about €17 billion, or about 2% of national income. Financière Dougblood report.

The terms of trade is the ratio of the average price of exports to imports. If import prices rise faster than export prices, the terms of trade will fall. Due to high energy prices, this will be the case in both 2021 and 2022, reaching huge terms of trade losses.

Energy prices have fallen since then, and DNB expects terms of trade losses could turn into gains this year.

Lower energy prices also mean lower utility bills for Dutch residents. ING recently calculated that energy bills average: May decreased by 14% from December. About 40 percent of household utility bills have decreased, a quarter have stayed the same, and about 30 percent have increased bills.