The Netherlands is a parliamentary democracy with a constitutional monarchy. King Willem-Alexander is the head of state, and has reigned since 30 April 2013. Long renowned for its internationalist outlook, the Netherlands was a founding member of the European Union (EU), the United Nations (UN), the North Atlantic Treaty Organization (NATO) and the Organisation for Economic Cooperation and Development (OECD). With Belgium and Luxembourg, it is also a member of the Benelux Economic Union. While the capital city of the Netherlands is Amsterdam, the Dutch Government and Parliament are located in The Hague.
The Netherlands is host to seven international legal organisations: the Permanent Court of Arbitration, the International Court of Justice, The Hague Conference on Private International Law, the Iran-US Claims Tribunal, the International Criminal Tribunal for the former Yugoslavia, the International Criminal Court, and the Special Tribunal for Lebanon. The first six are situated in The Hague, as is the EU’s criminal intelligence agency, Europol, and the EU’s judicial cooperation agency, Eurojust. It is also host to the Organisation for the Prohibition of Chemical Weapons (OPCW).
In the Netherlands, the political powers of the monarch are largely ceremonial. Effective executive authority in Government is exercised through the Prime Minister, who presides over the Council of Ministers. The Prime Minister is usually the leader of the largest party in the Second Chamber of Parliament (equivalent to the House of Representatives in Australia). The Council of Ministers comprises 13 to 16 ministers and a number of state secretaries, who traditionally support ministers.
There are three levels of government in the Netherlands: national, provincial and municipal. The Netherlands is divided into 12 provinces, each administered by a directly-elected Provincial Council, a Provincial Executive and a Sovereign Commissioner, who is appointed by royal decree.
General elections for the national Government are normally held every four years, using a system of strict proportional representation. A broad centrist coalition comprising the conservative-liberal People’s Party for Freedom and Democracy (VVD) and the Labour Party (PvdA) was sworn into office on 5 November 2012, following elections in September of that year. Mark Rutte, leader of the VVD, is the Prime Minister of the Netherlands. Lodewijk Asscher (PvdA) is Deputy Prime Minister and Minister of Social Affairs and Employment. Bert Koenders (PvdA) is the Foreign Minister, while Lilianne Ploumen (PvdA) serves as Minister for Foreign Trade and Development Cooperation, reflecting the strong correlation the Netherlands sees between international trade and development. The next general election is due in March 2017.
Foreign policy overview
Key objectives of the Netherlands’ foreign policy are promoting and defending Dutch prosperity and national security. The Netherlands is highly dependent on foreign trade and therefore has a direct interest in, and seeks to promote, a stable international rules-based order.
The Netherlands has a long history of promoting human rights. Other foreign policy priorities include addressing global poverty and inequality, climate change and other environmental threats, energy security, international terrorism, proliferation of weapons of mass destruction and human trafficking. Strengthening regional and global institutions, including the UN, has long been a focus of Dutch foreign policy. Despite growing Euroscepticism in recent years, the Netherlands remains essentially committed to the EU.
The Netherlands is a significant aid donor, committing approximately 0.76 per cent of gross national income to Official Development Assistance in 2015. The majority of this is contributed through multilateral organisations, including the EU, the UN, Human Rights Fund and Stability Fund. The Netherlands targets its aid to 15 countries concentrated in the Middle East and Africa but also including Bangladesh and Indonesia (the Government recently announced that aid to Indonesia would cease in 2020). It views development cooperation as a vehicle for economic growth with the ultimate aim of countries becoming self-reliant.
The Netherlands has long seen climate change as one of the major global challenges and continues to be a strong advocate of international action to address it. The Dutch Government aims to achieve a sustainable energy supply system by 2050.
The Netherlands is a small, wealthy trading nation with a population of 17 million (2015). Its economy is open and highly-developed, with activity focused on food processing, chemicals, petroleum refining, electrical machinery and financial services. The Netherlands serves an important role as a European transportation hub, with Rotterdam the largest port in Europe.
Trade is an important aspect of the Dutch economy. In 2015, the Netherlands was the world’s second largest agricultural exporter and fifth largest exporter of goods generally. Most of the Netherlands’ trade is with EU countries, especially Germany and Belgium. The country’s principal merchandise exports are machinery and equipment, chemicals, fuels and foodstuffs.
The Netherlands is an attractive destination for foreign investment, given its open economy, outward focus, sound public sector, good social services, modern and effective infrastructure and a dynamic private sector. The Netherlands is an important international investor, and is home to a number of large companies with multinational operations, including Royal Dutch Shell, Unilever, ING Group and Rabobank. The Netherlands has one of the world’s most highly-developed pension fund industries, with significant levels of private assets under management. The Dutch venture-capital market is among the best developed in Europe.
Australia enjoys warm and friendly relations with the Netherlands, founded on strong trade and investment ties, people-to-people links and cooperation on international issues. Australia and the Netherlands are closely aligned in foreign and trade policy, cooperating productively on non-proliferation and disarmament, human rights, World Trade Organization issues and UN reform. We continue to cooperate closely in seeking accountability for the July 2014 downing of Malaysian Airlines flight MH17 in which both countries suffered significant loss of life.
To further cement the bilateral relationship, Foreign Minister Bishop and Dutch Foreign Minister Koenders signed a Declaration of Intent on a Strategic Dialogue between Australia and the Netherlands in November 2016. The declaration commits Australia and the Netherlands to enhanced cooperation on international security, trade and investment, human rights and development issues. Recognising the importance of the economic relationship, the declaration also underscores the commitment to negotiating an Australia-EU free trade agreement.
Australia and the Netherlands have a bilateral social security agreement for people who have lived and/or worked in both Australia and the Netherlands. This agreement also exempts Australian employers from the need to provide Netherlands social security support for temporary work in the Netherlands, if the employee is covered in Australia by compulsory superannuation arrangements. Further information is available from the Australian Taxation Office.
During the 1950s, Australia was the destination of 30 per cent of Dutch emigrants and the Netherlands-born became numerically the second largest non-British group in Australia. The 2011 census recorded more than 76,000 residents of Australia born in the Netherlands and around 335,000 Australians claim Dutch ancestry. According to the Dutch Central Bureau for Statistics, approximately 15,000 first or second generation Australians live in the Netherlands.
- In November 2016, Their Majesties the King and Queen of the Netherlands visited Australia following an invitation by the Governor-General. The State visit commemorated the 400th anniversary of the landing of Dirk Hartog off the coast of Western Australia and incorporated Perth, Canberra, Sydney and Brisbane.
- In November 2016, the Dutch Minister of Foreign Affairs, Bert Koenders, visited Australia to support the State visit by Their Majesties the King and Queen of the Netherlands and to meet with ministerial counterparts.
- In November 2016, the Dutch Minister of Foreign Trade and Development Cooperation, Lilianne Ploumen, and Minister of Economic Affairs, Henk Kamp, visited Australia with a high-level trade delegation.
- In October 2016, Australian Minister for Trade, Tourism and Investment, the Hon Steven Ciobo MP, visited the Netherlands for meetings with industry groups and Minister Henk Kamp.
- In September 2016, Australian Minister for Urban Infrastructure, the Hon Paul Fletcher MP, visited the Netherlands for meetings with government officials and companies active in airport infrastructure.
In February 2011, the Dutch Government repatriated to Australia over 1000 artefacts that were recovered from Dutch East India Company ships that sank off the Western Australian coast in the 17th and 18th centuries. The artefacts were returned under the Agreement between Australia and the Netherlands Concerning Old Dutch Shipwrecks (ANCODS). A Mutual Declaration was signed in 2010, to acknowledge that Australia would hold the ANCODS Collection but that the Netherlands could borrow it for exhibitions. The Collection is on display at the Western Australian Museum in Fremantle.
Bilateral economic and trade relationship
The Netherlands is a significant investment and trading partner for Australia. It is Australia’s third largest export market within the EU, with $2.6 billion in goods and services in 2015-16. Significant Australian merchandise exports to the Netherlands that year included coal, other ores and concentrates, medical instruments, beef, and oil seeds and oleaginous fruits (such as olives). Significant imports from the Netherlands included medicaments (including veterinary), pharmaceutical products and coffee.
Australian services exports to the Netherlands in 2015-16 totalled $408 million (mostly personal travel (excl. education) and professional, technical and other business services). Services imports from the Netherlands totalled $1.3 billion in 2015-16.
The Netherlands is home to a number of financial institutions and other companies that operate in Australia, including ING Group, Fortis, Rabobank, AEGON, Shell, Unilever, Delta Lloyd, Philips, and Akzo Nobel. In 2015, the Netherlands was Australia’s fourth largest source of foreign direct investment (valued at $44.4 billion).
The Australian Trade and Investment Commission (Austrade) office in Frankfurt covers the Netherlands.