The cabinet’s decision to invest €2.5 billion in the Eindhoven area, partly to improve the infrastructure and education, has been welcomed by companies in the region.

The investment follows a strong corporate lobby, led by chip machinery maker ASML, which had hinted it is considering expanding abroad because of the decline in local business climate.

Most of the money – €1.7 billion – comes from national government, while the rest will be raised locally.

ASML has said repeatedly that it wants to expand in the Netherlands, but only if the conditions are right – such as the availability of skilled staff.

“We believe that the plans presented today, if supported by parliament, will give strong support to those conditions,” the company said in a statement. The company is currently finalising its expansion programme.

Ministers will also soon publish new tax plans which they also hope will be adopted by parliament and will head off other corporate objections.

Just before the November election, for example, MPs voted to introduce a tax on share buy-backs, to reduce the scope of the 30% tax break for some foreign workers, and to increase bank and asset taxes.

Tax minister Marnix van Rij has pledged to come up with an alternative plan for all these higher taxes later this spring.

“This is another chapter,” economic affairs minister Micky Adriaansens said. “It is very easy for companies to say that they don’t have to pay tax over share buy-backs in Germany, so they will move there. So this too is part of the investment climate.”