Netherlands is a country where economic opportunity abounds. It is the largest exporter in the EU after Germany. The country is a hub for the transit of goods within Europe. The Netherlands is ranked the fourth most competitive nation in the 2020 IMD Rankings. It is fifth on the 2020 Global Innovations Index. The Netherlands is one of the largest recipients and sources of foreign direct investment (FDI) in the world. It is one of the largest historical recipients of direct investment from the US. The Dutch economy has received significant FDI in logistics, information technology, and manufacturing. 8% of all FDI inflows to the EU go to the Netherlands. It is a great place for new businesses to start and existing organizations to expand. The positive startup climate makes it a great place for migrants, including expat entrepreneurs. These professionals prioritize supporting their families back home with remittances sent via the Ria Money Transfer App and similar channels.
The Dutch government offers competitive tax reductions, reimbursements, and allowances to new businesses. One of the benefits to expat entrepreneurs is a corporate tax rate as low as 5% for research and development. Moreover entrepreneurs with a turnover of less than EUR 20,000 per year can be exempt from paying VAT.
An online tool called The Startup Box created by the Dutch government helps businesses identify if there is a suitable government funding instrument for their startup. Funding schemes for startups include innovation credit, Dutch Good Growth Fund (DGGF), and financial support for self-employed professionals (Bbz).
The Dutch government has made the process of getting a startup visa relatively easy. Aspiring entrepreneurs who want to start an innovative business in the Netherlands can easily get a residence permit. The Netherlands Enterprise Agency evaluates and assesses startup ideas.
Aspiring entrepreneurs must meet the following conditions:
- They must have an agreement to work together with a recognized Dutch facilitator.
- Their product or service must be innovative.
- They must have a clear documented business plan.
- They must register their new business with the Dutch Chamber of Commerce (KvK).
- They must have sufficient financial resources to live in the Netherlands. The specified amount per year is EUR 14,000 (DKK 104, 000).
A recognized facilitator is an experienced business mentor that provides guidance and support to applicant entrepreneurs. They help develop startups in the Netherlands. Some recognized facilitators in the Netherlands are 15KM, Amsterdam Centre for Entrepreneurship (ACE), Brainport, and Collider.
Sectors for entrepreneurship
Agriculture and fishing in the Netherlands are highly profitable, even though they account only for a small percentage of employment and GDP. Despite the small size of the country, the Netherlands is the world’s third largest exporter of agricultural products like meat, dairy, and eggs. The largest industries in the Netherlands are agribusiness, metal and engineering products, electrical machinery and equipment, chemicals, petroleum, construction, and microelectronics.
Effect of COVID-19
The Dutch Government has created programs to help businesses mitigate losses incurred from COVID-19. One of these is the Reimbursement Fixed Cost TVL program. SMEs from certain sectors can get a reimbursement of up to EUR 330,000 to cover part of their fixed costs. Another program is the Kickstart Voucher. This is for SME’s whose international activities have been hit by the COVID-19 crisis. The Kickstart voucher enables these businesses to hire an external advisor to help limit the consequences of the crisis. The advisor can help with improving international production, supply chains, and logistics. This advisor can also help in creating an international sales and marketing plan, researching new international incomes models, and organizing money matters and process management from a distance.
External advisors have a high level professional education. They have expert knowledge of legal and tax matters. They bring 3 years or more of experience in international business. The external advisor can be based abroad and can speak English or Dutch. The Kickstart voucher is an online voucher that can be used to pay an external advisor. It covers 80% of the costs up to EUR 2,500 excluding VAT.
About the author:
Hemant G is a contributing writer at Sparkwebs LLC, a Digital and Content Marketing Agency. When he’s not writing, he loves to travel, scuba dive, and watch documentaries.