Belgium GDP Q1 2021


Belgium: Economic growth returns in Q1

April 29, 2021

According to a preliminary estimate, GDP increased 0.6% on a seasonally-adjusted quarter-on-quarter basis in the first quarter, contrasting the 0.1% contraction recorded in the fourth quarter of last year. On an annual basis, economic activity contracted 1.0% in Q1, up from the previous quarter's 4.9% fall, owing to a more favorable base effect. Q1's reading marked the best result since Q4 2019.

Although a breakdown of expenditure components is not yet available, production data shows that industrial activity grew by 1.3%, construction activity by 0.1%, and the services sector by 0.2%.

Looking at Q2, the lockdown inherited from the previous quarter will weigh on activity early in the period. However, the beginning of the easing of restrictions from mid-April should lead to a pickup in momentum later in the quarter.

On this, analysts at the EIU commented:

“Restrictions to control the second coronavirus wave will be in place well into the second quarter of 2021. [However,] as the virus is likely to be gradually brought under control during 2021, owing to the vaccine rollout, economic activity will start recovering. Confidence—and hence demand—should pick up in the second half of the year.”

Daniela Ordonez, chief French economist at Oxford Economics, sees lockdown savings providing a boost to activity ahead:

“Our recent research shows that consumers are eager to spend their savings accumulated during the lockdowns once enough inoculation allows restrictions to be lifted significantly, something we expect to happen from late-Q2 as vaccination is finally picking up. As such, we have raised significantly our forecasts for consumer spending in H2 this year and next year.”

FocusEconomics Consensus Forecast panelists project GDP to increase 4.1% in 2021, which is down 0.1 percentage points from last month’s projection. For 2022, the panel sees economic growth of 3.6%.

Author:, Junior Economist

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Belgium GDP Chart

Belgium GDP Q1  2021 0

Note: Quarter-on-quarter changes of seasonally-adjusted GDP in %.
Source: National Bank of Belgium (NBB) and FocusEconomics Consensus Forecast.

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