Belgium Economic Forecast

Belgium Economic Outlook

May 3, 2022

GDP growth slowed further in Q1 2022, marking the weakest result since the pandemic-induced recession ended in Q4 2020. The slowdown was chiefly driven by a contraction in the industrial sector, while activity in both the services and construction sectors expanded at healthy paces. On the expenditure side, both domestic demand and the external sector likely took hits from the economic fallout of Russia-Ukraine war at the end of Q1. Turning to Q2, growth is likely to grind to a halt as external headwinds intensify. Consumer confidence remained entrenched deep in negative territory in April, after plunging in March, amid soaring commodity prices due to the Russia-Ukraine war. This bodes poorly for household spending in the quarter. That said, business confidence recovered lost ground in April, suggesting that private sector activity remains resilient in the face increasing economic uncertainty.

Belgium Economic Growth

Economic growth is expected to moderate in 2022 from last year’s level as the favorable base effect subsides, but it should remain robust. Private consumption growth is expected to remain strong, in line with normalizing activity. That said, pandemic-related uncertainty and the repercussions from the Russia-Ukraine war threaten to derail economic momentum. FocusEconomics analysts see the economy expanding 2.4% in 2022, which is down 0.3 percentage points from last month’s forecast, and 1.9% 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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