Belgium - Economy
In relation to its size and population, Belgium is among the most highly industrialized countries in Europe. Poor in natural resources, it imports raw materials in great quantity and processes them largely for export. Exports equal around twothirds of GDP, and about three-quarters of Belgium's foreign trade is with other EU countries.
For a century and a half, Belgium has maintained its status as an industrial country, not only by virtue of its geographical position and transport facilities but also because of its ability for most of this period to shape production to meet the changing requirements of world commerce. Since the 1950s, the Belgian parliament has enacted economic expansion laws to enable long-established industries to modernize obsolete plant equipment. Belgium's highly developed transportation systems are closely linked with those of its neighbors. Its chief port, Antwerp, is one of the world's busiest. Belgium has a highly skilled and productive workforce, and the economy is diversified. By 2002, the service sector accounted for approximately 70% of GDP, followed by manufacturing (25%) and agriculture (2%).
Real growth averaged 5.4% annually during 1967–73 but, like that of other OECD countries, slumped to 2.5% during 1973–80, and 0.7% during 1981–85. It averaged 2.6% during 1984–91 and was 2.3% in 1995. In 1993, Belgium's recession was the most severe in the EU after Germany's. By 1998, real growth stood at 2.8%. Economic growth was expected to rise to some 3% in 2004 as a result of a recovery from the global economic downturn existing in 2001–03 (GDP growth in 2001 was estimated at 1.1%). The government will need to keep the budget from falling into deficit; budget surpluses will be needed until around 2030 to provide for the costs of an ageing population.
In 1993, when Belgium became a federal state with three distinct regions (Flanders, Wallonia, and Brussels), substantial economic powers were given to each region, such as jurisdiction over industrial development, research, trade promotion, and environmental regulation. Belgium has been seen as a "laboratory state," in that its federal system might stand as a precursor to a more unified EU based on regional divisions.
A UN study in 2002 listed Belgium as having the fourth-highest standard of living in the world. However, being a highly taxed and indebted country, some businesses have stated Belgium stifles private enterprise. Belgium in 2003 had had a balanced budget since 2000, the first in 50 years.