The Dutch economy is set to take a significant hit from newly imposed U.S. trade tariffs, with growth expected to drop by a full percentage point through 2026, according to the Netherlands Bureau for Economic Policy Analysis (CPB).

In an updated economic forecast released Thursday, the CPB said U.S. tariffs announced by President Donald Trump will reduce Netherlands GDP growth by 0.4 percentage points in 2025 and 0.6 percentage points in 2026.

Revised Dutch Economic Forecast Amid Trade Tensions

Prior to the tariff announcement, the CPB projected Dutch economic growth at 1.9% for 2025 and 1.5% for 2026. The latest forecast signals a steep adjustment, driven largely by reduced investment and growing uncertainty in the global trade environment.

“Investments will bear the brunt of the damage,” CPB stated, citing instability and cautious business sentiment due to the unfolding US-EU trade conflict.

Limited Export Exposure Cushions the Blow

Despite the economic slowdown, Dutch exports are expected to be less severely impacted. The United States accounts for just 6% of the Netherlands’ total export volume. Additionally, the tariffs may not immediately suppress U.S. demand, as American importers lack readily available alternatives for many EU goods.

The CPB’s projections are based on a 20% U.S. tariff on all EU imports announced on April 2, 2025, which was subsequently suspended for 90 days. A baseline tariff of 10% on nearly all U.S. imports went into effect on April 5, 2025.

EU Retaliatory Tariffs Could Deepen Impact

The CPB added that if the European Union imposes reciprocal tariffs, the overall effect on Dutch economic performance would remain largely the same, intensifying pressure on trade-dependent sectors.