Economical overview
Belgium is a small and open economy with a
diverse industry, extensive foreign trade and a large
service sector. The central location in Europe and many
international bodies and companies provide benefits. But
the country is divided, between the richer Flanders and
Wallonia, who had difficulty recovering after the
downturn in the coal and steel industry.
The Flanders in the north is prosperous with modern
manufacturing industry and Europe's second largest port,
Antwerp. Wallonia in the south has seen previously heavy
industrial branches like coal and steel turn into crisis
industries, and the region is dependent on financial
support from both the Treasury and the EU. As a whole,
Belgium lives on its extensive service sector, which
accounts for just over three-quarters of GDP, as well as
a diverse industry.
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Major imports by Belgium, covering a full list of top products imported by the country and trade value for each product category.
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Thanks to its location and good transport potential,
the Belgian economy benefits greatly from the EU's
internal market. The country is the seat of many
international and multinational companies and has
attracted extensive foreign investment which has mainly
benefited Brussels and the already wealthy Flanders.
At the same time, the domestic business sector is
characterized by a high proportion of small and
medium-sized enterprises, not least in comparison with
the rest of Europe.
Belgium had relatively strong economic growth during
the 1990s, but struggled with high unemployment, a
government budget deficit and a government debt, which
in the middle of the decade amounted to a full 135
percent of GDP. Through the deficit policy, the deficit
and government debt gradually decreased. Among other
things, extensive privatizations of state property were
carried out, wage developments were held back and
unemployment benefits were lowered. Belgium qualified to
participate in the EU monetary union EMU from its
inception in 1999.
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Abbreviationfinder.org: Check this abbreviation website to find three letter ISO codes for all countries in the world, including BEL which represents the country of Belgium.
Work on reducing taxes for both companies and
individuals has continued, while further control over
taxes has been transferred to the regions.
The budget was in balance for the first time in 50
years in 2000 and went with a small surplus for a few
years until it again showed a smaller deficit in 2007.
At the same time, central government debt was down to
around 87 percent of GDP. It was still a high figure,
which exceeded the EU's rule of max 60 percent, but the
rate of decline impressed. However, the financial crisis
that broke out in the world in 2008 squeezed the central
government debt again and it has been above 100 percent
since 2011.
The financial crisis, like in many other places, led
to negative growth in 2009. The financial sector was
affected, as was the important foreign trade.
Nevertheless, Belgium fared better than many other euro
countries. The state acted quickly to prevent collapses
when financial companies and banks such as Fortis, Dexia,
KBC and Ethias had acute problems. State aid to the
labor market contributed to unemployment not soaring and
domestic demand maintained at a relatively good level.
The recovery was good in 2010 when the economy grew
despite the tough government crisis in the country (see
Modern history). Thereafter, growth slowed in and in
2012-2013 it was close to zero, and then only modest
increase. The eurozone debt crisis contributed to the
inertia.
FACTS - FINANCE
GDP per person
US $ 46,556 (2018)
Total GDP
US $ 531,767 Million (2018)
GDP growth
1.4 percent (2018)
Agriculture's share of GDP
0.7 percent (2018)
Manufacturing industry's share of GDP
12.8 percent (2017)
The service sector's share of GDP
68.8 percent (2018)
Inflation
1.5 percent (2019)
Government debt's share of GDP
102.0 percent (2018)
Currency
euro 1
Merchandise exports
US $ 342,516 M (2018)
Imports
US $ 341,776 M (2018)
Current account
- US $ 6,819 million (2018)
Commodity trade's share of GDP
172 percent (2018)
Main export goods
vehicles and machinery, chemical products, food,
diamonds
Largest trading partner
Germany, France, Netherlands, UK, USA
- 1 euro = 100 cents
2008
December
New government with the same parties
December 30
Former Speaker Herman Van Rompuy has formed a new government with the five
parties that formed since the formation of the government in March 2008. The new
Prime Minister, like Yves Leterme, belongs to the Flemish CD&V, but is also
popular among the French-speaking part of the population.
The government falls because of the Fortis business
Prime Minister Yves Leterme decides to resign after a court ruling on the
shareholders' line and decided to freeze BNP Paribas purchase of Fortis. The
Supreme Court has since accused the Prime Minister's staff of trying to
influence the court.
October
French bank takes over Fortis in Belgium
The international financial crisis is exacerbated and a decision is taken
that Forti's assets in Belgium will be saved by French bank BNP Paribas.
However, several shareholders are trying to stop the sale.
September
Effort to save bank
Together with the Netherlands and Luxembourg, Belgium agrees to donate money
to the financial empire Fortis, which has experienced major financial problems
in the international financial crisis. The Belgian government also agrees with
France and Luxembourg to rescue another troubled financial institution, Dexia
bank.
July
The prime minister is trying to step down
The Prime Minister has promised to present a draft constitutional amendment
on July 15, but the parties have continued to find it difficult to agree.
Deadlock prevails in the issue of power distribution, and the infected question
of electoral rules in the district of Brussels-Halle-Vilvoorde is also not
resolved. Leterme submits his resignation, but the king rejects the request.
March
Government ready at the last moment
Shortly before a deadline expires that would have forced new elections, the
government question resolves. Just over nine months after the election, a
five-party government coalition is formed: Christian Democratic CD&V and Liberal
Free Flemish Liberals and Democrats (VLD) from Flanders, and from Wallonia's
Liberal Reform Movement (MR), Socialist Party (PS) and the Middle Party Humanist
Democratic Center (CDH). CD&V's Yves Leterme becomes prime minister.
February
Settlement on decentralization
The major parties agree that some federal power should be transferred to the
regions. The changes are not as far-reaching as the Flemish parties demanded,
but the settlement nevertheless paves the way for the country to be able to
return to normal political conditions.
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