Belgium registered a budget deficit that amounted to 5.1% of its GDP in the third quarter of 2022, the largest in the Eurozone countries in that period, Eurostat data from Monday reads.
Figures on government deficits in Eurozone countries were published by Eurostat on Monday.
Belgium had the largest budget deficit with 5.1%, while the Eurozone average for the third quarter of 2023, which increased significantly compared to previous quarters that year, was at 3.3% of GDP.
The average increase is mainly due to governments enacting measures to stave off the impact of high energy prices. Pandemic relief measures continued to influence government budgets, but to a lesser degree than in previous quarters.
For Belgium, the budget increase can be explained by its automatic wage indexation mechanism and the support measures it implemented to cope with rising energy costs.
After Prime Minister Alexander De Croo said the government would have to foot a heavy bill to ensure no one is left behind while expressing concern about the deficit in October, in November, the European Commission warned that Belgium would have the largest deficit in the Eurozone for the next two years.
Belgium’s deficit is set to surpass €17 billion in 2023 and exceed €20 billion in 2024 – and it is expected to increase even further as the government currently believes the current crisis can only be overcome with more spending.
The country’s budgetary situation is “alarming”, according to a yet-to-be-published report by Belgium’s Central Economic Council that was mentioned by Flemish newspaper De Standaard, press agency Belga reported.
Wallonia, Brussels and the federal government must reduce their deficits, according to the report which also points to the Flemish regional government’s better control of finances.
(Anne-Sophie Gayet | EURACTIV.com)
Source: euractiv.com
