Munuc Position Paper Eclac
The actions taken by the Netherlands in regards to state-owned enterprises have traditionally been the nationalization of such institutions. Effects have been mixed. Earlier in history, the nationalization and subsequent monopoly appears to have stifled the possible economic rewards. However, nationalization of businesses in response to current-day issues has saved entire economic sectors.
The Netherlands has experience with state-owned enterprises both in the Western Hemisphere and at home. The Netherlands’ colonies in the Caribbean were organized and ran by a state-owned enterprise. This was the Dutch West India Company, chartered by the Dutch Government in the early 1600s. It had a monopoly on all Dutch ventures in the colonies until 1640, at which point outside investment in New Netherland began after the West India Company relinquished its monopoly. The Netherlands began making large profits almost instantly (Interior, 2013). During the 2008 financial crisis, the Netherlands nationalized two banks and invested billions of dollars in other financial structures in order to prevent further damage to the economic sector. During this time period, the Netherlands also offered corporate tax breaks to companies that would keep employees (Agency, 2013). This prevented companies from attempting to cut costs as much as possible in order for the company to still compete with rivals, which would have been damaging. These examples indicate the Netherlands’ experience with nationalization and the introduction of new regulation to benefit its people.
The Netherlands has had success with two of the solutions proposed by ECLAC’s chair as well as introducing legislation. Due to this, The Netherlands has determined that no one solution will work to improve all state-owned enterprises. All cases of state-owned enterprises must be looked at individually. The nationalization of businesses in times of crisis can save economic sectors which leads to faster restoration of the
The Netherlands has experience with state-owned enterprises both in the Western Hemisphere and at home. The Netherlands’ colonies in the Caribbean were organized and ran by a state-owned enterprise. This was the Dutch West India Company, chartered by the Dutch Government in the early 1600s. It had a monopoly on all Dutch ventures in the colonies until 1640, at which point outside investment in New Netherland began after the West India Company relinquished its monopoly. The Netherlands began making large profits almost instantly (Interior, 2013). During the 2008 financial crisis, the Netherlands nationalized two banks and invested billions of dollars in other financial structures in order to prevent further damage to the economic sector. During this time period, the Netherlands also offered corporate tax breaks to companies that would keep employees (Agency, 2013). This prevented companies from attempting to cut costs as much as possible in order for the company to still compete with rivals, which would have been damaging. These examples indicate the Netherlands’ experience with nationalization and the introduction of new regulation to benefit its people.
The Netherlands has had success with two of the solutions proposed by ECLAC’s chair as well as introducing legislation. Due to this, The Netherlands has determined that no one solution will work to improve all state-owned enterprises. All cases of state-owned enterprises must be looked at individually. The nationalization of businesses in times of crisis can save economic sectors which leads to faster restoration of the
Cited: Agency, C. I. (2013, February 6). The World Factbook: Netherlands. Retrieved from Central Intelligence Agency . Interior, U. D. (2013, February 6). Dutch Colonization. Retrieved from National Park Service: http://www.nps.gov/nr/travel/kingston/text.htm