Economic projections for Belgium

The National Bank of Belgium publishes economic projections for Belgium twice a year. The main results are reproduced here. The results are discussed in more detail in the June 2019 issue of the Economic Review.

The projections are produced as part of a joint Eurosystem exercise and are based on technical assumptions and international forecasts formulated jointly by the ECB and the euro area central banks. They only take account of measures that have been – or are very likely to be - formally approved and for which the implementing arrangements have been set out in sufficient detail at the cut-off date of the projections. The projection period runs to year t+3 (in this case up to 2021); the margin of error surrounding the projections increases for the later years, partly owing to the greater uncertainty about the assumptions, especially those concerning the international environment.

The latest projections for Belgium, published on 7 June 2019, were finalised on 22 May 2019. The corresponding results for the euro area are published on a dedicated webpage on the ECB’s website.

Against the backdrop of a gradual recovery in world trade, activity in Belgium is set to expand at a fairly steady pace. The normalisation of investment growth and the slight decline in the growth contribution of net exports will largely be offset by rising household consumption (as a result of the increase in purchasing power). Overall, year-on-year growth is estimated at 1.2% (or slightly below) throughout the projection period. In cumulative terms, and including 2019, more than 120 000 additional jobs should be created over the projection period. The unemployment rate is set to remain more or less stable at 5.7 %. HICP inflation is projected at 1.5% in 2019, considerably lower than last year, the main factor being energy prices. It is expected to remain at roughly its current level until 2021. The public deficit is estimated at 1.3% of GDP for 2019, and is projected to rise to 2.1% of GDP by the end of the projection period.

 

Projections for Belgium: Overview of the main results
 

2017

2018

2019e

2020e

2021e

Real GDP
(percentage changes)

1.7

1.4

1.2

1.1

1.2

Domestic employment  
(average annual change, in persons)

64 500

61 700

60 800

33 700

26 900

Unemployment rate
(in % of the labour force)¹

7.1

6.0

5.7

5.7

5.7

Inflation (HICP – percentage changes)

2.2

2.3

1.5

1.6

1.5

Overall balance of general government
(in % of GDP)

-0.8

-0.7

-1.3

-1.7

-2.1

Public debt
(in % of GDP)

103.4

102.0

101.4

101.3

 101.2

Source: NBB
1 15-64-year-olds, gross data.

Date finalised: 22 May 2019. Next publication: December 2019.