Belgium GDP Q4 2020


Belgium: Economy loses momentum in Q4 but outperforms expectations

January 29, 2021

According to a flash estimate, the economy stagnated in the fourth quarter amid a second Covid-19 wave and tighter restrictions, growing a mere 0.2% on a seasonally-adjusted quarter-on-quarter basis, after rebounding 11.6% in Q3. On an annual basis, economic activity was down 4.8% in Q4, deteriorating from Q3's 4.3% fall. Although a breakdown of expenditure components is not yet available, production data shows industry grew 4.7% and construction by 3.3%. However, the services sector was down 0.6%.

Despite the slowdown, activity held up better than expected amid the second-wave. On this, Philippe Ledent, senior economist at ING, commented:

“GDP growing by 0.2% therefore seems to indicate that […] compared to the first lockdown, many enterprises have succeeded in adapting their working conditions to the containment measures imposed. Probably 4Q was also boosted by stronger exports due to inventory building in the UK in the run-up to the end of the Brexit transition period.”

However, on the outlook, he cautioned:

“The containment measures taken in the fourth quarter are, for the most part, still in force. As a result, economic growth is expected to be almost nil in the first quarter and could be slightly negative as containment measures might not be loosened before the second quarter, with the more contagious strains of Covid-19 now also increasing. “

FocusEconomics Consensus Forecast panelists project GDP to increase 4.4% in 2021, which is up 0.2 percentage points from last month’s projection. For 2022, the panel sees economic growth of 3.9%.

Author:, Junior Economist

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Belgium GDP Chart

Belgium GDP Q4  20 20 2

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

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