Cabinet: More and Better Physical Space Needed for Business Activity by 2050

Companies currently occupy 2.6% of the Netherlands land area excluding water. Housing accounts for 7.2%, nature 14.9%, and agricultural land 66.3%. The cabinet expects that population growth, sustainability ambitions, and the goal of a circular economy by 2050 will require about a 15% increase (from 2.6% to 3%) in physical space for business activities on campuses, science parks, and industrial sites.

The Council of Ministers has agreed, on the proposal of Minister Adriaansens of Economic Affairs and Climate Policy, to the Program Space for Economy which outlines a national approach to these spatial economic challenges. This national program was announced earlier in October 2022 by the cabinet. It also takes into account the already increased demand for space for business activities, amounting to an expansion need of 700 hectares annually until 2030.

Minister Adriaansens: “Sustainability and digitalization not only change our society but also require more physical space. Think of the innovative high-tech manufacturing industry, a rapidly growing energy infrastructure with batteries and hydrogen production, or the raw material processing and storage needed for a circular economy. Therefore, the cabinet will nationally coordinate a program to ensure sufficient economic space. The goal is to prevent companies from not coming here or leaving due to lack of space, to meet climate goals, or to ensure there are enough locations where innovative researchers and startups can collaborate.”

Population Growth, Energy Transition, Circular Economy, and Digitalization

Part of the additional required space is due to population growth: the labor force grew by approximately 1.3 million people to 9.7 million in the past decade. Economic changes also play a role. For the transition to a sustainable energy system, batteries, transformers, wind farms, hydrogen factories, and high-voltage lines and stations are needed. Replacing fossil fuels with sustainable ones requires - at least temporarily - extra space at work locations.

A circular economy involves raw material processing and storage for reuse. Due to e-commerce, digitalization, and the shift to a circular economy, both a future-proof logistics network and logistics companies are needed. Geopolitical developments necessitate maintaining strategic reserves and a Dutch share in the production and distribution chain of critical raw materials and semi-finished products.

Minister Adriaansens intends to implement the program in close cooperation with all stakeholders (other ministries, municipalities, provinces, regional development agencies, campus organizations, and entrepreneurs).

In addition to the program, the cabinet will present a national Spatial Economy Exploration early next year to integrate business activities into existing spatial visions for areas such as housing, mobility, nature, and climate & energy.