Belgium: Selected Issues

IMF Staff Country Reports, December 8, 2023

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Belgium is facing higher structural deficits and rising debt after the pandemic and energy crisis.
Fiscal consolidation is needed to lower inflation, rebuild buffers, reduce debt, and preserve Belgium’s social contract.
Comparisons with peers show that rationalizing and increasing the efficiency of social benefits and the public wage bill would need to be at the core of the consolidation effort.
All federal entities should share the burden of the adjustment, in a coordinated manner, with accountability at all levels of government, and within a credible and clear multi-year consolidation plan.
Comprehensive spending reviews would help target budgetary saving.
To mitigate the near-term growth impact and boost potential growth, public investment should be preserved, and the adjustment should be paired with structural reforms to increase labor force participation and productivity.

Rationalize and increase efficiency of social benefits.
Rationalize and increase efficiency of the public wage bill.
Ensure that all federal entities share the burden of adjustment in a coordinated manner.
Establish accountability at all levels of government.
Implement a credible and clear multi-year consolidation plan.
Conduct comprehensive spending reviews to identify targeted budgetary savings.
Preserve public investment to mitigate short-term growth impacts.
Combine fiscal consolidation with structural reforms to raise labor force participation and productivity.

Fiscal consolidation and fiscal policy
Expenditure efficiency (social benefits, public wages)
Governance and intergovernmental coordination
Public investment prioritization
Structural reforms to boost labor and productivity
Pension spending and demographic considerations (Aging, Population and demographics)
Interaction with monetary policy and inflation control

Source: IMF Staff Country Reports — Belgium: Selected Issues

Belgium: Selected Issues; IMF Country Report No. 23/387; November 20, 2023
- Belgium: Selected Issues; IMF Country Report No. 23/387; November 20, 2023 (Markdown version)
- Belgium: Selected Issues; IMF Country Report No. 23/387; November 20, 2023 (PDF)