Netherlands Falls Behind in Global Innovation Race Despite Scientific Excellence
The Hague, Friday, 12 December 2025.
New analysis reveals the Netherlands is losing ground in innovation competitiveness, with only 21.5% of startups scaling up compared to 54.1% in the US. Despite strong scientific publication output, the country struggles to translate research into patents and commercial products. R&D spending is projected to drop from 2.18% to 2% of GDP by 2030, while meeting Europe’s 3% target would require an additional €7.4-12 billion annually in combined public and private investment.
TNO’s Stark Assessment Reveals Declining Competitiveness
The Netherlands Organization for Applied Scientific Research (TNO) published a comprehensive analysis on December 11, 2025, supporting the findings of the Wennink Report, which paints a concerning picture of Dutch innovation performance [1]. The research reveals that between 2013 and 2022, the Netherlands’ share of scientific publications decreased despite the country’s historical strength in academic research [1]. More troubling, the analysis shows Dutch companies are falling behind in converting research excellence into commercial success, with patent shares declining across ten critical national technology areas including quantum computing, biotechnology, artificial intelligence, and mechatronics [1]. This deterioration occurs at a time when global competitors are accelerating their innovation efforts, particularly China and the United States, which demonstrated enormous growth in patent applications between 2015 and 2025 [1].
Startup Ecosystem Struggles to Match Global Leaders
The Dutch entrepreneurial landscape faces significant challenges in nurturing high-growth companies, with data showing that only 21.5% of Dutch startups successfully scale up into larger enterprises [1]. This performance falls short of the European Union average of 23.1% and lags dramatically behind Germany’s 40.6% success rate and the United States’ impressive 54.1% scale-up ratio [1]. The disparity highlights structural weaknesses in the Dutch innovation ecosystem, particularly in accessing growth capital and navigating regulatory frameworks that can hinder rapid expansion. Peter Wennink, former CEO of ASML and author of the eponymous report, delivered this analysis to the demissionary cabinet on December 11, 2025, emphasizing the urgent need for systemic reforms [4]. The report warns that without immediate action, the foundation of the Dutch economy risks becoming increasingly unstable as businesses and skilled workers migrate to more competitive jurisdictions [4].
R&D Investment Gap Threatens European Competitiveness Goals
Current projections indicate that Dutch research and development intensity will decline from 2.18% of GDP in 2022 to approximately 3.99/2 = 2% by 2030 if existing policies remain unchanged [1][3]. This downward trajectory moves the Netherlands further from the European Union’s ambitious target of 3% GDP investment in R&D by 2030 [3]. To bridge this gap and meet European standards, the Netherlands requires substantial additional investments: approximately 13.7/2 = 6.85 billion euros annually in private R&D spending and 5.7/2 = 2.85 billion euros in public R&D investments [1]. TNO’s calculations reveal that Dutch R&D intensity has fluctuated between 1.6% and 2.3% of GDP for over five decades, suggesting systemic challenges in sustaining consistent innovation investment [3]. The organization emphasizes that achieving the desired 1.5% economic growth rate will require not only increased R&D spending but also complementary capital investments extending until at least 2035 [3].
Massive Investment Requirements for Economic Revival
TNO Vector’s analysis, conducted in collaboration with RaboResearch, estimates that reversing the Netherlands’ declining productivity trend requires an extraordinary investment commitment of €151 to €187 billion over the next decade [5][6]. This translates to roughly €19 billion annually in additional spending across knowledge development, capital formation, and addressing structural bottlenecks [5]. The analysis reveals that Dutch productivity growth averaged merely 0.6% per year over the past two decades, a sharp decline from the 1.8% annual growth achieved between 1974 and 2003 [5]. Without intervention, government spending is projected to exceed revenues by more than €100 billion per year by 2035, while average households could lose approximately €1,700 in purchasing power annually at current growth rates [5]. Mark Courage, TNO’s director of smart industry, underscores the urgency by noting that the Netherlands has approximately 250 robots per 10,000 workers, far below South Korea and China’s 1,000 robots per 10,000 workers [4]. The report advocates for establishing a National Investment Bank with €10-20 billion in working capital and a National Agency for Groundbreaking Innovation with an annual €2 billion budget to mobilize the necessary private sector investments [5].