Economic growth
Atradius expects economic growth of 2.7 per cent in 2018. This growth is broadly driven by rising consumption, increased investment and export growth. Private spending is also on the rise this year thanks to high consumer confidence, job growth and a rise in purchasing power. In 2019, economic growth slows slightly to 1.7 per cent as purchasing power declines slightly due to higher inflation and the contribution from net trade declines. At 13 per cent, the expected fall in the number of bankruptcies in 2019 is about the same as a quarter ago.
For 2019, the global economic outlook is about the same as last year. The international business cycle continues to be supported by low interest rates, positive sentiment and the tax cut in the United States. Economic growth in the eurozone does slow down slightly in 2019. This, according to Atradius, is because consumption growth is weakening, due to moderate wage growth combined with rising inflation and declining trade growth.
Increase in risks within eurozone
Furthermore, economic risks in the eurozone have increased in recent months. Time is running out for the European Union (EU) and the United Kingdom (UK) to reach an agreement on Britain's exit. If no agreement with the EU is reached in the coming months, a 'hard Brexit' is in the offing. Such a chaotic Brexit poses a risk to the Netherlands, for whom the UK is an important trading partner.
Another risk for the eurozone is the conflict between the Italian government and the European Commission over the 2019 budget. If this situation escalates, it could lead to a deterioration in confidence. This is damaging for the Italian economy and has negative spillover effects to the rest of Europe. Italy's insolvency rate is expected to rise at least 4 per cent in 2019.
