RZ-100-wt4-E-flipbook-240702 - Flipbook - Page 22
De Beurskrach
Despite rising revenues, auction turnover in
The Stock Market Crash has a huge negative impact
The Westland declines from 20 million guilders
on the agriculture sector in general and the seed
in 1929 to NLG 10 million guilders in 1935.
trade in particular. Rijk Zwaan’s main customers,
Many growers get into financial difficulties, and in
market gardeners, are losing a large part of their
1932 many growers are in dire straits. The government
exports due to this recession. For example, exports
decides to intervene and issues a series of crisis
of fruit and vegetables to Germany drop by
laws and decrees. Measures for the horticultural
80 per cent in the period from 1929 to 1935. Exports
industry include a limit on imports, a minimum price
to the UK show a similar drop. High import tariffs,
agreement and production limits. In addition, the
imposed by many countries in response to the
farmers receive aid as a supplement to auctioned
economic crisis, reduce overall exports by around
produce. Despite all the good intentions, the
60 per cent, but dark clouds are now also gathering
measures appear to have little effect. Income in the
over domestic outlets. With the prosperity of recent
horticulture sector continues to fall sharply, and the
years, many market gardeners, including Rijk Zwaan,
incomes of the farm workers employed there also
have invested significantly in their businesses. In the
continue to decline. From an average of 27 guilders
early 1930s, that leads to high production figures.
per week, wages drop to 17 guilders. This results in
This causes even more misery, because while yields
widespread poverty among workers in the horti-
are rising, prices are dropping dramatically.
culture and agriculture sectors.
Until just before 1930, the seed trade was still
Commercial Netherlands, with its ‘open
prosperous, but after 1930 a severe global
economy’, is strongly dependent on foreign
economic recession struck. The Stock Market
trade and so suffers more than other countries
Crash of 23 October 1929 – ‘Black Thursday’ –
during this international depression. Added
set the stage for a severe economic crisis that
to this, the Netherlands is one of the last
plagued the world throughout the 1930s.
countries in Europe to stop using the Gold
One of the causes of the crisis in
the Netherlands: holding on to the
Gold Standard for too long.
Standard (in 1936). By then, the fixed link
A number of root causes are to blame for the
between gold and currency had been aban-
crisis that preceded the stock market crash.
doned by almost every country in the world.
The restoration of the Gold Standard in the
Netherlands in 1925 (when the Netherlands
For a long time, the Dutch government
re-linked its currency to the value of gold, just
continued to believe in the beneficial effects
as Great Britain did) doesn’t appear to be in
of the system and hoped that other countries
tune with the real situation. Short-term credit
would eventually return to the Gold Standard.
is very often used when long-term credit
Nothing could be further from the truth,
would have been more appropriate.
however, and in 1936 the Netherlands too had
1929: Stock Market Crash
to give way. The Dutch economy had fallen
When the crisis turns out to last longer than
way behind because of this. While in 1936 the
expected, balance of payments deficits start
lowest point of the crisis in the surrounding
to widen. In addition, a large number of
countries had long since passed, in the
countries take protectionist measures that
Netherlands the economic recovery was
severely hamper foreign trade.
only beginning.
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Rijk Zwaan | Moving forward together
