(Bloomberg) -- A Dutch budget proposal due to be unveiled on Tuesday will show that its economy will emerge from a pandemic-induced contraction, even as the European Union warns the country isn’t doing enough to invest in green policies.

The Bureau for Economic Policy Analysis will project that the economy will grow by 3.9% this year and 3.5% in 2022, according to a report by Dutch newspaper de Telegraaf. That compares with a 3.8% contraction last year.

The Dutch response to the Covid-19 crisis has outpaced many Western neighbors, with nearly 86% of adults having received at least one vaccination. The Netherlands is also expected to spend 40.9 billion euros ($48 billion) on its recovery effort this year.

But the fact that the Netherlands has been operating without a government for eight months -- ever since Prime Minister Mark Rutte’s cabinet resigned over an internal scandal -- means that ambitious policy actions have been delayed. That includes making a formal request for the 6 billion euros in grants earmarked for the Netherlands in the EU’s massive stimulus plan.

“You have to start doing big investments now,” Diederik Samsom, the cabinet chief for the EU’s Climate Commissioner Frans Timmermans, warned in the Dutch media over the weekend.

The new budget will also call for about 7 billion euros to be spent on climate policies, including subsidies for energy infrastructure, according to de Telegraaf.


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