Resilience requires tough choices

How resilient are The Netherlands and Europe in a world where geopolitical tensions are rising and economic interdependencies are becoming more apparent? According to Sandor Gaastra, Secretary-General of the Ministry of Economic Affairs and Climate , that question starts with something seemingly simple: trust in the systems on which our society relies. ‘We cannot afford strategic vulnerabilities.’

‘In Utrecht, at the end of last year, reliable drinking water suddenly stopped flowing from the taps. Within an hour, the supermarkets were empty. People had emergency kits and shared bottles of water with family and friends. At a time like that, you immediately see what resilience is,’ says Gaastra. ‘And how quickly it comes under pressure. Water, energy and food are not, after all, things we can take for granted. As soon as confidence in what was previously the norm is shaken, we immediately realise how dependent we are.’

We live in a world where unrest is on the rise. Geopolitical tensions, trade conflicts and disruptions in supply chains affect us all. This forces us to ask fundamental questions. How resilient are we as The Netherlands? How resilient are we as Europe? And how do we simultaneously ensure that we maintain our high standard of living? The TIC sector also plays an important role in this area of tension.

Interdependencies in Europe

The Netherlands cannot be viewed in isolation from Europe. ‘On a global scale, This country is a minor player and our future is inextricably linked to that of the European Union,’ says Gaastra. He refers to recent policy analyses. Mario Draghi, former President of the European Central Bank and former Prime Minister of Italy, demonstrates that Europe is not doing well economically. He was commissioned by the European Commission to investigate how Europe can strengthen its competitiveness. Enrico Letta, also a former Prime Minister of Italy, analysed how the single market could function more effectively. Their conclusion: Europe must make decisions more quickly, invest more strategically and accelerate innovation in order to remain economically relevant.

‘Consider the discussion surrounding Nexperia and the dependency on chips, or the dependency on other countries for crucial raw materials needed for, for example, the digital and energy transitions. These are strategic vulnerabilities that we cannot afford.’

At the same time, the European internal market is not yet complete. A fully-fledged capital market union is lacking. ‘The differences in regulations between EU member states are significant, and that makes scaling up difficult. That is a global disadvantage.’ Resilience requires Europe to actually reduce interdependencies, enter into new partnerships, and conclude trade agreements with other parts of the world. With support from The Netherlands. In addition, more innovation is needed, and that calls for the targeted deployment of European resources and simpler regulations.

The Netherlands must dare to make choices

Europe may provide the context; the Netherlands also faces its own challenges. To this end, Gaastra cites The Route to Future Prosperity – Strong Netherlands in a Relevant Europe, the report by Peter Wennink that translates the analyses of Draghi and Letta to the Dutch situation. ‘That report shows that structural obstacles are putting our competitiveness under pressure. Grid congestion and the nitrogen issue affect the entire economy.’ Companies are relocating because they cannot access electricity or space here. This impacts investments, innovation, and productivity.

We must also take a critical look at our regulations. Where can rules be simpler, smarter, or even abolished? ‘We cannot keep doing everything,’ says Gaastra. ‘The Netherlands must dare to make choices about where to focus its economic efforts and where its strategic strength lies.’ At the same time, productivity growth requires targeted investments in education and research. ‘Public funds can drive private investments, provided that plans are actually implemented.’

According to Gaastra, a clear role is reserved for the TIC sector in this regard, as it plays a major part in our daily lives and in the functioning of the economy. ‘Accreditation and conformity assessment are not called the silent engine of European competitiveness for nothing.’ The sector works to build trust. It lowers costs for companies and enables trade on a European and international scale. Without reliable testing, there are no safe batteries, no medical innovations, and no digital applications that companies can rely on.

At the same time, he sees the challenges. For instance, the playing field in Europe is not level everywhere: not all TIC companies deliver the same quality. Moreover, countries like the United States act faster and are increasingly determining norms and standards. ‘Whoever sets the standard holds the market in their hands.’

This is therefore a joint task, says Gaastra. ‘The Netherlands and the EU must set priorities and commit to them consistently. The TIC sector can contribute by actively taking the lead in strengthening the Dutch and European markets.’ In this way, we strengthen not only our position within Europe, but also beyond.