THE HAGUE, Oct. 3 (Xinhua) -- The resilience of Dutch businesses is being put to the test as they grapple with a range of financial difficulties from lingering COVID-related debts to surging costs.
Some 91,000 entrepreneurs in the Netherlands still carry outstanding COVID-related debts to the Dutch tax authorities, according to a recent letter to the country's parliament by State Secretary for Finance Marnix van Rij.
Of these indebted businesses, at least 43,000 have not paid a single installment to date, according to the letter.
After the start of the coronavirus crisis in March 2020, Dutch entrepreneurs received tax deferrals for a total amount of 47 billion euros (49 billion U.S. dollars). These debts should have been repaid starting in October 2022, but some 14.8 billion euros are yet to be paid back.
According to a recent report by Statistics Netherlands (CBS), some 5,000 to 10,000 businesses are at risk of encountering financial difficulties due to mounting debts.
This concern is especially pronounced in sectors such as hospitality, where many business owners are afraid they will be unable to meet their financial obligations.
The CBS surveyed companies with five or more employees regarding their debt situations, and found that one in 20 companies considers their debt burden problematic. In the hard-hit hospitality industry, this ratio climbs to one in eight businesses, a legacy of the sector's struggles during the COVID-19 lockdowns.
Companies are also spending more on energy, wages, and procurement, according to the CBS.
A total of 4,058 hotel and catering entrepreneurs closed their businesses in the first half of 2023 due to factors such as rising wages, higher rents and rising energy prices, according to Dutch media reports.
The number of closures is around 20 percent more than last year, the reports say, and even more than in the first half of 2020 when the COVID-19 pandemic broke out.
In an August report, the CBS said that entrepreneurial confidence in accommodation and food services had decreased to minus 10.8. Entrepreneurs in this sector remained negative about the economic climate for the next three months. (1 euro = 1.05 U.S. dollars)
