Further measures needed to safeguard Belgium's public finances, planning bureau warns

Additional measures will be needed in both the short and long term to safeguard the sustainability of Belgium’s public finances, according to new economic forecasts published on Thursday by the Federal Planning Bureau.

The budgetary measures adopted by the De Wever government are expected to reduce the public deficit from 5.3 per cent of gross domestic product (GDP) in 2025 to 4.9 per cent this year, the bureau said. However, if policy remains unchanged, the deficit is projected to widen again in the years thereafter, reaching 6.3 per cent by 2031, well above the European benchmark of 3 per cent.

Under this scenario, public debt would rise from 107 per cent of GDP in 2025 to 117 per cent in 2029 and 122 per cent in 2031. The public deficit and debt remain "a particular point of attention", said Baudouin Regout, commissioner at the Planning Bureau.

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Continued growth expected

The bureau expects the Belgian economy to continue growing at a steady pace. Growth stood at 1 per cent last year and is forecast to reach 1.1 per cent this year, driven by stronger investment from both businesses and the government. Between 2027 and 2031, GDP growth is projected to range between 1.1 and 1.4 per cent.

Employment rose last year, supported by an increase in the number of self-employed workers and public sector employees, while the number of private sector wage earners declined slightly. Private sector salaried employment is expected to recover modestly this year and to accelerate from 2027 onwards. Over the period 2026 to 2031, the Planning Bureau forecasts a net increase of 273,000 private sector jobs.

Inflation is projected to reach 1.9 per cent this year, just below the European Central Bank’s 2 per cent target for the eurozone, before easing to 1.7 per cent by 2031. The forecasts take into account the reform of excise duties on gas and electricity and a selective VAT increase. A temporary rise to 2.2 per cent is expected in 2028 following the introduction of the new emissions trading system.

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