Belgium Economic Forecast

Belgium Economic Outlook

May 31, 2022

Output grew at a reduced pace in Q1 2022 compared to Q4 2021, chiefly driven by a contraction in industry. That said, the services and construction sectors expanded at healthy paces and unemployment continued its downward trend. Since March, growth is likely sluggish, affected by the global slowdown in demand and high inflation. Industrial production is likely being affected by the sector’s elevated dependency on Russian gas, high prices for which will squeeze firms’ profit margins. Moreover, consumer confidence remained severely downbeat in April and May, likely weakening consumption in the quarter. That said, business confidence held up through May, which could be supporting investment intentions. Finally, in a May report the European Commission recommended that Belgium focus on addressing fiscal sustainability challenges, excessive red tape and the low participation rate.

Belgium Economic Growth

External headwinds are expected to curb economic growth this year. Private consumption and investment momentum will likely decline amid a drop in consumer confidence and soaring prices. Industrial output will also be affected by Russian energy dependency and a global decline in vaccine demand. That said, European funds will support private investment. FocusEconomics analysts see the economy expanding 2.3% in 2022, which is down 0.1 percentage points from last month’s forecast, and 1.8% in 2023.

Belgium Economy Data

2015 2016 2017 2018 2019
Population (million)11.211.311.411.411.5
GDP per capita (EUR)37,08338,04939,32140,31341,289
GDP (EUR bn)417430446460473
Economic Growth (GDP, annual variation in %)2.01.52.01.41.4
Domestic Demand (annual variation in %)2.22.21.22.11.4
Consumption (annual variation in %)1.61.91.81.51.1
Investment (annual variation in %)3.73.81.34.03.2
Exports (G&S, annual variation in %)3.76.55.31.21.1
Imports (G&S, annual variation in %)3.97.54.42.11.0
Industrial Production (annual variation in %)-1.24.62.91.74.8
Retail Sales (annual variation in %)2.3-0.1-0.5-0.60.6
Unemployment Rate8.57.97.16.05.4
Fiscal Balance (% of GDP)-2.4-2.4-0.7-0.8-1.9
Public Debt (% of GDP)10510510299.898.6
Inflation Rate (HICP, annual variation in %, eop)1.52.22.12.20.9
Inflation Rate (HICP, annual variation in %)0.61.82.22.31.3
Inflation (PPI, annual variation in %)-  -  -  -  -  
Policy Interest Rate (%)0.050.00.00.00.0
Stock Market (annual variation in %)12.6-2.510.3-18.522.0
Exchange Rate (vs USD)1.091.051.201.141.12
Exchange Rate (vs USD, aop)1.111.111.131.181.12
Current Account (% of GDP)1.30.61.2-1.3-1.3
Current Account Balance (EUR bn)5.82.45.5-6.4-5.8
Trade Balance (EUR billion)19.217.218.511.616.7
External Debt (% of GDP)256277256242248

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Belgium Facts

Value Change Date
Bond Yield0.100.15 %Dec 31
Exchange Rate1.120.65 %Dec 31

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