Belgium: GDP growth revised up in first quarter
June 8, 2011
In the first quarter, GDP rose 1.1% over the previous quarter in seasonally adjusted terms, according to revised data published by the National Bank of Belgium on 8 June. The reading was revised up from the 1.0% expansion previously estimated on 29 April and represented an acceleration compared to the 0.5% increase tallied in the fourth quarter. Compared to the same period the year before, GDP grew 3.0%, faster than the 2.1% expansion observed in the final quarter of 2010. The quarterly improvement was mainly the result of strong growth in investment and positive developments in the external sector. While private consumption slowed somewhat over the previous quarter (Q4: +0.6% quarter-on-quarter; Q1: +0.2% qoq), government consumption maintained the same pace observed in the fourth quarter (Q1: +0.3% qoq). On the other hand, gross fixed investment accelerated from a 0.3% increase in the fourth quarter to a 1.4% expansion in the first, the fastest pace since the last quarter of 2007. Meanwhile, a buoyant external sector saw exports of goods and services expand 2.3% in the first quarter, maintaining the pace observed in the previous quarter. In contrast, imports slowed to a 1.7% expansion in the first 3-month period, below the previous quarter's 3.9% increase. As result, the net contribution from the external sector to overall economic growth improved from a 1.2% percentage-point detraction in Q4 to a 0.5 percentage-point addition in Q1. At the sector level, the first quarter improvement was broad-based, although a marked pick up was recorded in the industrial sector. Meanwhile, the Central Bank revised its economic growth forecast and now anticipates that the economy will grow 3.0% this year, up from its previous 2.0% estimate. For 2012, the Bank expects the economy to grow 2.0%.
Author: Ricardo Aceves, Senior Economist