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1 The Netherlands voted yesterday to elect a new Parliament, with talks now set to begin on the formation of a new government is a crucial year for Europe, with France and Germany also going to the polls, and this DeHavilland EU briefing takes a first look at the results of this potential bellwether of an election. The 2017 Dutch Parliament, or Tweede Kamer, election had been framed as a race between incumbent, liberal Prime Minister Mark Rutte and right-wing populist Geert Wilders. By this metric, the voters delivered a clear win for the former, in a contest that saw a high turnout of over 80%. The governing VVD remains the largest party by a clear margin with around 21% of the vote, while Wilders' PVV, despite picking up seats, did not make the hoped-for breakthrough. Whether this is a predictor of results in the upcoming French and German elections remains to be seen, but leaders around Europe were quick to offer relieved congratulations. Meanwhile, as is so often the case with junior coalition partners, the Labour Party (PvdA) was all but wiped out at the ballot box, losing around three quarters of its seats. The Green Party, GroenLinks, was the biggest winner, jumping from 4 seats to 14. The Christian Democrats and the liberal left D66 performed strongly, with over 12% of the vote each, and both look likely to feature in the next coalition government. Negotiations on this will now start, and at least four parties will be needed to form a majority. The evenly distributed nature of the results mean that Rutte will have a number of different options. DeHavilland Information Services Ltd

2 European Union The reaction from European leaders and politicians speaks volumes about what happened in the Dutch election. There was concern that a strong performance from Geert Wilders' PVV would signal a hat-trick of populist victories following Brexit and President Trump s election. Instead, what transpired was a strong showing for liberal, pro-eu parties such as the VVD, CDA and D66. The apparent halt in the nationalist and populist tide will give confidence to pro-europeans in France and Germany ahead of elections there. Mark Rutte (VVD) Despite losing eight seats, Mark Rutte s VVD still won the largest share of the vote and it now has 33 seats. As a consequence, it will take a leading role in forming a governing coalition. Mr Rutte has been strengthened by the dispute with Turkish President Erdogan and a third successive term as Prime Minister appears to beckon. D66 and Chistian Democratic Appeal The collapse of the centre-left PvdA has been capitalised upon by other parties, such as the centrist Christian Democrats CDA and left-liberal D66. Both parties made gains and now have 19 seats each. Gains made by other smaller parties allude to the fragmentation of Dutch politics after years of centrist parties dominance. The Labour Party (PvdA) There is little doubt that the biggest loser from the election was the centre-left PvdA. It lost 29 seats which is the worst electoral result in Dutch history hardly an enviable record to have. The collapse in the PvdA voter base appears to be the result of its role in the previous governing coalition. Its supporters have seemingly favoured other left-wing alternatives, such as the the GreenLeft and Socialist Party instead. Geert Wilders (PVV) Whilst gaining five seats, the far-right and anti-eu PVV fell short of expectations and it faces exclusion from talks to form a new governing coalition. Having said this, Mr Wilders has shifted the centre-ground in Dutch politics which even figures like Mark Rutte have had to coalesce around. It remains to be seen how Mr Wilders nationalist, populist, and anti-eu platform will feature in the new Dutch political landscape. Nationalists Although Geert Wilders continues to assert that a patriotic spring will occur, nationalists and right-wing populists throughout Europe will have been disheartened as the election results rolled in. The fact that pro-eu parties had the most success will be welcome news to Brussels. GreenLeft (GL) The biggest winner from the election was GroenLinks (GL), having gained 10 seats to bring their total to 14. The left-wing insurgents capitalised on the collapse of the PvdA voter base. DeHavilland Information Services Ltd

3 PvdD 5 50PLUS 4 SGP 3 Denk 3 FvD 2 VVD 33 CU 5 PvdA 9 SP 14 PVV 20 GL 14 D66 19 CDA 19 The Liberal Party VVD of incumbent Prime Minister Mark Rutte remains the country's biggest party, even though it is set to lose 8 seats. As Rutte put it: one previous case set aside, the VVD is now the smallest biggest party in Dutch history. The PVV of far-right populist Geert Wilders, in the opinion polls ahead of elections day in a neck and neck race with the VVD, received considerably less votes than expected, but still sees an increase in the number of Parliament seats for the next four years. The Christian Democrat CDA and liberal left D66 follow closely, both increasing their number of seats, and both seen as very likely coalition partners in a future government. The party that enjoyed the highest increase in votes, and therefore described by some as the greatest winner, is green party GroenLinks (GL). VVD 33-8 PVV CDA D GL SP 14-1 PvdA 9-29 CU 5 0 PvdD PLUS 4 +2 SGP 3 0 Denk 3 +3 FvD 2 +2 DeHavilland Information Services Ltd

4 Where there are winners, there are losers, and this holds certainly true for the PvdA. The Dutch Labour Party, which was junior coalition party in the last government, saw its number of seats dropped dramatically from 38 to 9. Several smaller parties do have reason to celebrate, as they either keep the same number of seats, or increased their presence in the Dutch Parliament. Two parties will enter Parliament for the first time: DENK, a party established by former Labour Party members, and the Eurosceptic FvD. Despite the relieved reactions from other EU countries about the containment of Eurosceptic populist Geert Wilders, the Netherlands itself also sees the election result as heavy criticism of its government's policy over the last four years, with both governing parties losing seats and especially junior coalition partner PvdA suffering an enormous blow. With several opposition parties gaining a stronger position in the Parliament, forming a coalition is going to be an interesting exercise. As Mark Rutte said himself, the government formation is likely going to be "complex". Following the elections in 2012, it took the parties 49 days to form a coalition, and negotiations look set to be even more complex this year. We look below at some of the possible options. All parties have firmly stated before the elections that they will not work together in a coalition with Geert Wilders' PVV, and though it remains to be seen whether they will live up to their promise, at least VVD and CDA should remember their last government cooperation with the PVV in , which failed. A Centre-right Alliance The Netherlands' biggest party VVD can form an alliance with parties on the centre-right: liberal left D66 and Christian Democrats CDA, with additional support from the ChristenUnie (CU), a smaller party ideologically close to the CDA. Rutte has already indicated that he would like to form a government with CDA and D66, so this coalition seems most likely, provided support from a fourth party such as CU is obtained. A Centrist Government with GroenLinks or PvdA Mark Rutte could also opt for a more centrist government with green party GroenLinks, which would include the liberal left D66 and the Christian Democrats as well. Alternatively, Labour Party PvdA could be involved in the coalition again, but following its defeat, the party has indicated that being part of the opposition would be a more likely option. A Progressive Coalition If Mark Rutte does not succeed in forming a government that involves his own party, other options will be brought to the table that may exclude the VVD. However, without the VVD present, a coalition with a large number of smaller parties will be necessary to get the required majority of 76 Parliament seats, with the support of the Christian Democrats. This coalition would then further include GroenLinks, PvdA, Socialist Party, PvdD and D66. DeHavilland Information Services Ltd

5 European leaders must have awaited the results of the Dutch elections with some anxiety, especially in France and Germany, where the Dutch election results could be an indicator for their own national elections later this year. Despite a gain in seats, the rise of the Eurosceptic far-right PVV was somewhat contained and European leaders' reactions following the votes therefore mainly expressed relief. Reactions to the result also came from the EU level. "It is also an evening in which the Netherlands, after Brexit, after the American elections, said stop to the wrong kind of populism" Incumbent Prime Minister Mark Rutte "I would rather have been the largest party, but we are not a party that has lost. We gained seats. That s a result to be proud of" PVV leader Geert Wilders "I warmly congratulate Mark Rutte for his clear victory against extremism" French President François Hollande "The Netherlands are our partners, friends, neighbours. Therefore I was very happy that a high turnout led to a very pro-european result, a clear signal. And that after days in which the Netherlands had to tolerate accusations and reproaches from Turkey which are totally unacceptable... It was a good day for democracy" German Chancellor Angela Merkel "The election result in the Netherlands shows that trees do not grow in heaven. Democracy and reason are stronger than demagogy" - Peter Altmaier, head of Merkel's office "The people of The Netherlands voted overwhelmingly for the values Europe stands for: free and tolerant societies in a prosperous Europe. I look forward to continuing our excellent working relations, in particular our work on the future of Europe" Commission President Jean-Claude Juncker "A very disappointing result for my PvdA. But the vast majority of voters rejected the extreme populists. Which gives hope for the future" Eurogroup Chair Jeroen Dijsselbloem "The serious approach of the centre-right and CDA has been rewarded. We need clarity and strict demarcation from the radicals. The electoral result in the Netherlands is a real blow for all anti- Europeans. Good news for Europe!" EPP Chair Manfred Weber MEP "Mark Rutte and Alexander Pechtold have shown that a positive pro-european message wins. People want constructive and reliable politicians to govern their country. This is why Le Pen will also fail" - Guy Verhofstadt MEP DeHavilland Information Services Ltd

6 The big story in the run up to polling day was an election dominated by divisive politics, with the international media speculating that there could be a victory for the far-right. Dutch voters did not read the script. Instead, they delivered a clear win for the centre-right incumbent and the ingredients for a liberal, pro-european government. There are clear implications for the continent's other two major elections this year. Mark Rutte himself said that his win had been a "quarter-final" for Europe, with the 'semi-final' in France next month and the 'final' in Germany in September. French frontrunner Emmanuel Macron wasted no time in responding to the result by saying that "the Netherlands shows us that the breakthrough of the far-right is not inevitable and that European progressives are growing in strength". If this election was a question of whether a founding member of the EU and one which has often been a bellwether state - would reject the liberal consensus and opt for nationalism, then the Dutch appear to have said "nee". It is worth noting too that turnout rose from 74.6% in 2012 to over 80% this year, as people made their voices heard. The exact position of the new government is hard to predict, with any governing coalition relying on at least four partners. However, assuming that Mr Rutte remains Prime Minister, there may be pressure to deliver policies that match the hard-line rhetoric he adopted on immigration during the campaign. More positively for the EU is that he will almost certainly turn to CDA and D66 for support, both of whom are pro-european. The Euro currency responded positively to exit polls, climbing to a five-week high. Whatever form the final government takes, officials in Brussels and leaders across the EU were breathing a sigh of relief. Their hope will be that this is a pattern for elections to come in Europe. This is the first of a series of DeHavilland EU briefings on this year's elections in Europe. See an introduction to the upcoming votes in France and Germany here. This briefing is an example of the in-depth political information DeHavilland EU provides to public affairs and policy professionals every day. Our analysts gather vital political news from the European institutions to bring our customers reports tailored to their information needs. To find out how DeHavilland EU s political intelligence can help your organisation, and to request a free trial, contact our team now. Just visit or call +32 (0) DeHavilland Information Services Ltd