AMSTERDAM (Reuters) - The Dutch government said on Monday it will invest 20 billion euros ($23.6 billion) in education, infrastructure and research and development projects over five years to help strengthen its economy and better shield it from future recessions.
Finance minister Wopke Hoekstra said the government would take advantage of ultra-low interest rates on its bonds to borrow money for the dedicated fund.
"It is clear we have to invest our way out of this crisis," economy minister Eric Wiebes said. "We need to invest in innovation, the jobs of tomorrow and the transition to a sustainable economy."
The new borrowing will add to Dutch government debt, which is already set to balloon to 60% of gross domestic product next year due to spending on unemployment benefits and support for companies during the coronavirus crisis.
After years of austerity, the Dutch government had brought down its debt to 49% of GDP last year.
The Dutch focus on improving government finances has often been criticized by institutions such as the International Monetary Fund, which said the Dutch needed to invest more in education and infrastructure to help stimulate economic growth throughout the euro zone.
Investment proposals for the fund will be weighed by an independent committee, including ex-finance-minister Jeroen Dijsselbloem, the former CEO of chemicals company DSM (AS:DSMN), Feike Sijbesma, and chip machine maker ASML's (AS:ASML) CEO Peter Wennink.