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Primary response to crisis

The Cabinet's primary response to crisis (in the fall 2008) has been one of immediate action with extensive support of the financial sector as well as a series of measures designed to limit the impact of the credit crisis on the Dutch economy.

Financial institutions

The crisis first emerged in 2007 in the United States. In September 2008 European banks also fell prey to the decline in lack of confidence among financial institutions.

The Dutch-Belgian bank, Fortis, was the first institution in the Netherlands to run into financial trouble. On 3 October 2008 the Dutch State acquired full control of Fortis Nederland and Fortis' interest in ABN AMRO. This was done to restore confidence and protect savers' money.

In October 2008 the Netherlands raised its guarantee on savings to 100,000 euro.

Provision/injection of capital

Where necessary the Netherlands will strengthen the balance sheets of generally healthy financial institutions by injecting capital. 20 billion euro has been made immediately available for this purpose.

Loan guarantees

The government is also prepared, subject to conditions, to secure loans extended between banks and by institutional investors to banks. This is intended to get credit flowing between financial institutions again.

The government anticipates that the State may have to guarantee a total of 200 billion euro worth of loans.

Economy

On 21 November 2008 Prime Minister Jan Peter Balkenende announced that the government would take a series of measures designed to limit the impact of the credit crisis on the Dutch economy. The government wanted to give businesses 'extra breathing space' by boosting their liquidity. It therefore reintroduced accelerated depreciation.

Other measures include:

• temporary arrangements for reduced working hours, under which employees can apply for unemployment benefit on a temporary basis;
• regional mobility centres to help people move on from one job to another. These are aimed at preventing the threat of rising unemployment;
• accelerating the development of infrastructure projects, including the new Delta Works project;
• swifter payment of bills by public authorities. This should chiefly benefit small and medium-sized enterprises.

Credit market

In January 2009 the government is taking a number of measures affecting lending to businesses, housing associations and healthcare institutions.

In a measure designed to keep trade flowing, the State will also provide cover for risks in markets where commercial export credit insurance is no longer available - mainly in eastern Europe.