The Netherlands risks losing control of its economic future. The Dutch innovation landscape is faltering, talent and capital are leaving and the country is becoming overly dependent on foreign countries. ‘Trying to do everything all at once, as we used to, has kept us from achieving excellence in any area. In a world in which speed, scale and focus determine the winners and losers, the only way to bolster job creation, our standard of living and our independence is to be selective,’ argues outgoing Minister of Economic Affairs, Vincent Karremans
Last Friday, the Dutch Council of Ministers (Ministerraad) approved Karremans’ proposal for a new industrial policy for the Netherlands, focusing on the highest-potential markets for the Netherlands. This new approach marks the conclusion of the top sector policy, which will be replaced by the new industrial policy on 1 January 2026. The new policy will focus on six sectors in which the Netherlands can be a global leader based on its strengths as a country.
Focus on six highest-potential markets
The industrial policy focuses heavily on digital technologies, in particular:
- Semiconductors;
- Biotechnology;
- Applications for defence (such as 6G, radar, laser satellite communication, quantum technology);
- Digital services (particularly AI);
- Mechanical engineering;
- Innovative chemistry.
The government will create programmes to bolster these six markets following the example of the Beethoven project for the semiconductor industry. This encompasses resources and initiatives, such as:
- People and resources
Programmes for each market, with extra capacity, knowledge and coordination by the government. Funding will be directed towards the highest-potential areas. - Expanding markets
Ecosystems will be reinforced for the selected markets. Where necessary and possible, demand will be stimulated through mechanisms such as strategic procurement by government and EU in order to accelerate innovation breakthroughs. - Funding and business factors
Easier access to capital, less red tape and solutions for physical space, grid congestion, infrastructure and permits. - International influence
The Netherlands is strengthening its market position by stimulating trade, attracting foreign business and investment and taking part in European programmes such as IPCEIs, Horizon Europe and contributing to the Net Zero Industry Act. - Talent and knowledge
Positioning the Netherlands as a magnet and training hub for digital and technical talent while investing in fundamental and applied research that has a direct impact on businesses.
Other businesses and the former top sectors will continue to benefit from access to generic innovation schemes such as the WBSO (Tax Credit for Research and Development), tax schemes and other funding for energy efficiency, but targeted programmes will be reduced or scrapped entirely. The Netherlands will also continue to offer a strong business climate for companies in all markets and sectors and deliver growth for all businesses in the Netherlands.
Making bold choices
‘Given the huge challenges we face, such as a tight labour market, grid congestion and increasing geopolitical uncertainties, we cannot afford to stick to the status quo. If we want to be a leader in 2040, we must make choices now. Investing in the six markets in which we can excel and make a real difference will bolster our security, economic growth and future living standards. It’s really simple really: if you don’t choose, you lose,’ says minister Karremans.
Countries including the US and China are investing billions in their tech and industry and accumulating market power by attracting business, knowledge and talent. The Netherlands must step up to the mark. The country’s traditional approach of allocating funding across numerous sectors and initiatives is proving ineffective.
The six highest-potential markets
The six highest-potential markets have been selected for:
1) economic potential;
2) strategic economic positioning;
3) their contribution towards solving societal challenges.
The Dutch Ministry of Economic Affairs cites strong market growth (averaging 16.8% per year) in digital services as a reason to focus on AI. Digitalisation, and in particular AI, is enhancing the country’s digital autonomy and has applications in areas ranging from healthcare and energy to security.
But digitalisation plays an important role in the other five markets, too. For instance, mechanical engineering encompasses areas such as chip machines and medical technology, and the semiconductor plays an essential role in AI, cybersecurity and the energy transition. There are also many niches in which the Netherlands is or has the potential to be a market leader, such as quantum technology and photonics. The emphasis in defence-related applications is on 6G, radar, laser satellite communication and quantum technology. At the same, digital technology and biotechnology are increasingly converging. Data analysis, AI and digital simulations are accelerating biotechnology research and production, and cybersecurity is key to protecting sensitive genetic and medical data.
A better climate for all businesses
Alongside these priorities, the Dutch government is looking at factors that affect all businesses: easier access to funding, less red tape, alleviating grid congestion, ensuring sufficient physical space and delivering a supply of technical and digital talent. That is why there will be a continued focus on the full breadth of the Dutch economy, looking for opportunities to develop new markets and apply technology. At the same time, the government will continue to collaborate with businesses on current societal challenges as part of its mission-driven innovation policy.
The new industrial policy aims to create an industry that represents at least 15% of Dutch GDP by 2030, with the goal of joint R&D investments (public and private) amounting to at least 3% of GDP by that time. Over the coming months, the government will be developing the programmes for each market. It will also assess where extra funding could be found or redistributed.