Belgium Other


Belgium: Political crisis reaches standstill record

March 30, 2011

On 30 March, Belgium won the title of the country that has been the longest time without a government ? 290 days and counting - a distinction previously held by Iraq. Since elections on 13 June 2010, Flemish nationalists, who had prevailed in the Dutch-speaking Flanders region, and French-speaking Socialists, who led the polls in the Wallonia region, had been unable to form a new coalition government, with no sign of a deal to break the stalemate. In addition to the linguistic division which naturally splits the country, the political stalemate reflects rifts about the economic support provided by richer Flanders region to the poorer Wallonia via transfers of the social security system. However, as the deadlock enters its tenth month and debt woes cloud the Euro area, the necessity to form a functioning government is particularly high. In the meantime, a caretaker government, led by Prime Minister Yves Leterme, has successfully prevented the country from falling into chaos. In fact, the government managed to adopt a budget and now agreed to cut the fiscal deficit for this year to 3.6% of GDP, which was revised from its previous target of 4.1%. The Prime Minister stated that the proposed budget would be presented to parliament towards the end of April, with final approval expected by mid-May.

Author:, Senior Economist

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