Companies can often pivot: high import levels do not necessarily create dependency
New research from the CPB suggests that Dutch companies are generally less dependent on single-country imports than feared, as alternatives are available for most products. While switching suppliers during a crisis remains complex due to logistical and market hurdles, the findings highlight that genuine dependency is relatively rare.
Research from the Netherlands Bureau for Economic Policy Analysis (CPB) indicates that Dutch companies are not necessarily dependent on foreign suppliers, even when they import the majority of their goods from a single nation. The study found that for most products, businesses can identify alternative sources of supply within the Netherlands, the European Union, or elsewhere globally. In only 3 percent of cases examined did the CPB fail to find a viable alternative source for companies to utilize if a primary supplier were to exit the market.
However, experts caution that the existence of an alternative does not guarantee a smooth transition during a crisis. Potential challenges include price or quality disparities, insufficient capacity among new suppliers, or the risk that multiple sources could be simultaneously affected by a global disruption. Furthermore, the landscape of dependency remains dynamic. Analysts note that as domestic production capacity declines due to stiff international competition, such as from China, the pool of available suppliers may shrink, potentially increasing future reliance on foreign markets.
Based on reporting by nu. Translated and condensed by LocalHeadlines.
