The Dutch economy is set to sink into recession next year, for the first time since the early 1980s, the Government's Economic Policy think-tank Netherlands Bureau for Economic Policy Analysis (CPB) said on Monday.
The organization forecast a 0.
75 per cent decline of GDP in 2009 and said companies which depend on exports would bear the brunt of the downturn, Dutch daily NRC Handelsblad reported.
The economy would pick up again in 2010, with growth reaching one per cent, the organization said.
"Nevertheless, the uncertainty surrounding the timing of the recovery remains great," the CPB said, adding "financial crises tend to last longer than a dip in the economic cycle.
" The Dutch economy grew 3.
5 per cent last year and the growth rate in the first three quarters this year were 3.
3 per cent, three per cent and 1.
8 per cent, respectively.
In September, the CPB predicted that the economy would grow by 1.
25 per cent next year.
The new figures also indicate that unemployment is set to rise to 6.
5 per cent, or by 200,000 people, by 2010.
Currently, the official Dutch unemployment rate is around 2.
6 per cent, the lowest in Europe.
But the CPB said that "lower commodity and energy prices would dampen inflation, which would benefit spending power.
" On average, spending power would rise 1.
75 per cent next year, with inflation falling to 1.
5 per cent.