After the recent elections, the Federal Planning Bureau released a report that warns of a significant increase in government deficits if policy changes are not implemented. While the Bureau’s forecast is slightly less pessimistic than the National Bank’s, both institutions are warning of an impending budget deficit without any action.
The National Bank had previously raised concerns just before the elections, projecting a budget deficit of 4.8 percent in 2024, 5.3 percent in 2025, and 5.5 percent in 2026 if no action is taken. Governor Pierre Wunsch expressed his disappointment at the lack of attention paid to addressing deficits during the electoral campaign.
According to its report, the Federal Planning Bureau forecasts that Belgium will face a budget deficit of 4.5 percent of GDP this year, increasing to 4.9 percent in 2025 and reaching a high of 5.3 percent by 2026, which exceeds the EU’s guideline for limiting deficits to a maximum of 3 percent. With potential deficits reaching figures as high as €40 billion euros, new governments are facing an uphill battle ahead.
Despite these concerning projections, the Planning Bureau predicts stable economic growth for Belgium in the coming years. GDP growth is expected to be around 1.4 percent in 2024 and remain consistent until 2029 while inflation is projected to average around €3.1% this year before falling below €2% target in following years
+ There are no comments
Add yours