here we have the netherlands a beautiful very flat country made up of windmills and tulip fields
when people think of the netherlands economy their mind goes straight to amsterdam whether
it be the coffee shops or recent headlines about post-brexit financial services but in this video
we are going to explore dutch agriculture which has helped turn the economy of the netherlands
into the silicon valley for food if i asked you who do you think is the biggest food exporter
in the european union you might think france spain or italy that's what i answered before
i researched this video as you might have guessed from the title of this video the answer
is actually the netherlands the dutch economy is the agricultural powerhouse of the european union
and that title could perhaps stretch to the world for certain fruits or vegetables the netherlands
is the second largest food exporter globally behind the united states but if you compare the
population of both countries it's no surprise the usa is ahead the truth is that agriculture in the
netherlands performs incredibly well and generates a lot of economic growth and productivity growth
for the dutch economy so how did this happen despite having a relatively low land mass
compared to other large agricultural economies understanding this is the aim of this video
that if you appreciate the work that goes into these videos don't forget to click that like
and subscribe button it costs you nothing and it can really help support the channel so why has
the economy of the netherlands become something of an agricultural powerhouse typically as countries
become more developed they move away from sectors like agriculture to heavy manufacturing and then
eventually services the reason for this is due to an economic concept called opportunity cost
this is essentially the hidden cost of making one decision over another for example if you
have a piece of land that is one hectare and you use it to grow potatoes you might earn 7
000 or 8 000 euros if instead you use that area to build a factory or an office the return could
be much higher well the netherlands has actually been a bit backwards in this aspect famous dutch
companies include shell and phillips and the first stock exchange in the world was actually
in the netherlands it wasn't until fairly recently that the dutch economy started looking at ways to
become a large agricultural producer and exporter now i know what you might be thinking agriculture
in the european union it's got to be subsidised you would be partially right as the common
agricultural policy is essentially just that but compared to other prosperous eu countries the
netherlands gets a much lower subsidy the dutch economy gets about a third of what greece gets
or a tenth of what france gets and when you consider this to one of the other countries
i've covered before switzerland it is clear that something else explains this the answer as to how
the netherlands economy has become the garden of the world can be explained in one word technology
that's the simple answer but that doesn't explain why other countries can't keep up after all it's
not as if spain or france can't afford technology and that's why we have to go back a bit further to
understand why agriculture in the netherlands was promoted as a sector in the 1970s the economy of
the netherlands was one of the most prosperous in europe compared to the uk the netherlands
was practically a paradise instead of rolling blackouts and constant strikes the netherlands
economy was growing and dominating global markets in electronics and gas however there were some
issues that started to appear in the netherlands during this time with market-leading firms growing
at a rate quicker than the rest of the economy it encouraged younger more educated workers to move
away from agriculture to well-paying sectors this put dutch agriculture under a lot of pressure an
issue made worse by the fact that dutch farms can't really benefit from economies of scale
unlike the usa which has incredibly large farms typically owned by big corporates
the netherlands had the opposite which made large investments more risky another issue at this point
is an economic concept called the dutch disease with sectors like natural gas bringing in large
demand the dutch currency continued to strengthen this made it even harder for dutch farmers to
compete with agriculture from other european economies so why didn't the dutch government
just give up on agriculture after all it wasn't that valuable to the economy of the netherlands
and trade was becoming more open across the globe meaning there wasn't a food security issue well if
the dutch government was looking at it purely from an economic perspective they might well have given
up on it but sometimes people and politics can get in the way of that the good news is that the
outcomes have been remarkably positive but we will come back to those later farming associations in
the netherlands had a disproportionate amount of power for example farming associations essentially
had an open door policy with the government and they regularly took the opportunity to try and
keep agriculture alive within the country as the rest of the economy was developing around them
dutch farmers were not willing to change from agriculture to one of the growing sectors
and given their political influence the government needed to figure out a way to deal with this issue
instead of giving up on agriculture the dutch government decided to double down on agriculture
and decided that if it was going to be part of the netherlands economy it was going to
be a productive one since salaries couldn't be reduced or more land created the only solution
was to improve productivity and that's where technology and research step in more specifically
the university of wagen again entered the scene and became a key economic player this university
is to the dutch economy what stanford university is to silicon valley stanford university is
not only a world leader in research they also produce the best computer scientists in the world
these computer scientists then leave stanford and go to work for facebook
apple or google for agriculture this dutch university takes up the mantle of world leader
and instead of being called silicon valley the netherlands has food valley many of you probably
hadn't heard of this university i certainly hadn't but its role cannot be understated it only works
in the world of agriculture and everything is geared towards producing the best research and
the best workforce for the sector they don't offer degrees in law or politics it is all about biology
chemistry or food science they are also funded in a very different way to most universities
which stems from the fact that to make dutch farming competitive it needed to be productive
the funding structure for the university is made up of both public and private sector funding
in the last two decades public sector funding for the university's research budget has doubled
and specifically improving the economy of the netherlands through something called agritech
over 25 of the funding then comes from the private sector typically agricultural firms wanting to
improve their own productivity this does not mean that the university is being privatized
nor does it mean that the research the university produces is hidden away never to be seen again it
actually has a major benefit which is that it allows the university to be connected to the
business community in the region and through a concept called the agglomeration effect this
has created an economic boom by working closely with agricultural businesses and helping them to
boost the dutch economy it has encouraged more firms to set up in the area this in turn leads
to business support services like accountants or lawyers setting up shop as well as cafes or
restaurants as wages go up most importantly in this instance it also encourages intelligent
people to come and study at the university the university is the most sighted in this field and
has incredibly close links with businesses whether you want to do research or become an entrepreneur
the university is the place to be for those interested in agriculture the result is that
40 of the students and staff at the university of foreign coming from every inch of the globe
for someone like me who can only speak one language it would be great as the official
language of the university is actually english to give an example of what this actually means
to people in real life let's look at tomato growing in the netherlands the starting point
is to understand that in natural dutch conditions growing tomatoes would be pretty challenging
thankfully through the research produced by the university the netherlands is a pioneer in led
technology and improving agricultural yields this helps create a precisely controlled micro climate
which can be operated 24 hours a day seven days a week this has helped the netherlands become
a world leader in tomato growing and exporting but there's also a bigger piece to all of this
economic growth and protecting the environment are often put side by side as things that are
mutually exclusive the dutch tomato is an example that shows that this
is not always true in the usa farmers need about 126 litres of water for every 1 kilo of tomatoes
in the netherlands farmers need just 8 liters of water to grow a kilo of tomatoes an amazing saving
in both economic and environmental terms not only does the university help to produce the research
it also plays a key role in getting that research out there so that farmers can take advantage of it
what i didn't know was how quick technology changes within agriculture and it's thanks
to the university and the dutch agricultural council the farmers can stay on top of that
after all it's no good being a farmer and getting money from the common agricultural policy and that
not knowing what to actually spend the money on the agricultural council helps signpost farmers
to the most up-to-date equipment for whatever crop they're trying to grow they want to grow potatoes
they'll be told what machines to get if they want to grow tulips they will be told what
tech they need the overall result is that dutch agriculture is one of the most productive
in the world but from an environmental perspective they reign supreme too for example antibiotics use
is much lower the same is true for pesticide usage water usage for their crops has fallen by close to
90 percent since the technology revolution began and thankfully being the open and trading nation
that the netherlands is they are exporting this technology around the globe which will hopefully
have a similar positive impact elsewhere both the united arab emirates and singapore have made
large orders for dutch agricultural technology they're doing this to improve their food security
and i wouldn't be surprised if other rich growing economies do the same it is a success story that
goes under the radar when thinking about the dutch economy but the cheese i had for lunch is in part
due to the agricultural revolution and for that i say thank you over to you then did you know before
this video how strong dutch agriculture was were you surprised by the role of agriculture in the
netherlands economy let me know in the comments section down below and whilst you're down there
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and subscribe button before you go thank you very much for watching and i'll see you in the next one