Economic projections for Belgium

The National Bank of Belgium publishes economic projections for Belgium once every six months. The main results of the latest forecasting exercise are presented below. A more detailed description of these projections can be found in the December 2017 issue of the Economic Review.

Compiled as part of a joint exercise for the Eurosystem, the projections are determined on the basis of technical assumptions and international prospects defined jointly by the ECB and the euro area central banks. In addition to that, the forecasts for public finances only take into account formally approved measures - or measures that are very likely to be approved - for which the implementing arrangements have been set out in sufficient detail at the cut-off date of the projection exercise. The forecasting period runs to year t+3 (in this case up to 2020), with the margin of error surrounding the projections widening for later years, not least because of greater uncertainty about the assumptions, in particular those concerning the international environment.

The latest projections for Belgium, published on 15 December 2017, were finalised on 30 November 2017. The corresponding results for the euro area are published in the ECB’s Economic Bulletin.

This year, economic activity is forecast to increase by 1.7 % and to continue growing at the same pace next year. In the two following years, a gradual cooling-off is expected (1.6 % in 2019 and 1.4 % in 2020). Including the year 2017, around 190 000 extra jobs are likely to be created (in cumulative terms) over the projection period, while the unemployment rate is forecast to drop to 6.9 %. Inflation is estimated to have peaked at 2.2 % in 2017, which is closely connected to the evolution in energy prices, only to fall back subsequently from 2018 to 1.6 %. The public deficit is estimated at 1.2 % of GDP in 2017 and by the end of the projection period, should rise to 1.5 % of GDP.

Projections for Belgium: Overview of the main results

 

2016

2017e

2018e

2019e

2020e

Real GDP (percentage changes)

1.5

1.7

1.7

1.6

1.4

Domestic employment
(average annual change, in persons)

57 700

69 400

54 000

37 600

29 800

Unemployment rate
(in percentages of the labour force)¹

7.9

7.3

7.0

6.9

6.9

Inflation (HICP – percentage change)

1.8

2.2

1.6

1.6

1.6

Overall balance of general government
(percentages of GDP)

-2.5

-1.2

-1.3

-1.5

-1.5

Public debt
(EDP definition. percentages of GDP)

105.7

103.3

102.1

101.2

100.5

Current account balance
(percentages of GDP - def. balance of payments)

0.1

0.0

0.1

0.1

0.0

Source: NBB.

1     15 to 64 year olds, gross data.

Date finalised: 30 November 2017. Next publication: June 2018.