Reuters logo
Belgian 2013 output seen flat, hit by shutdowns -cenbank
December 10, 2012 / 3:03 PM / 5 years ago

Belgian 2013 output seen flat, hit by shutdowns -cenbank

* Belgian central bank sees economic output shrinking 0.2 pct for 2012

* Bank expects no growth in 2013, against earlier forecast of 1.4 pct

* National debt seen rising to 100.6 pct of GDP in 2012

* Belgian budget deficit seen at 2.8 pct in 2012

BRUSSELS, Dec 10 (Reuters) - Belgium’s economy will contract this year and stagnate in 2013, the Belgian central bank said on Monday, as factory shutdowns hit confidence.

The bank sees output falling 0.2 percent this year and expects no growth in 2013. In an estimate published in June, it had forecast 1.4 percent growth next year.

“From the beginning of October to the beginning of November we’ve had some news on companies closing, which has impacted trust,” central bank Governor Luc Coene told a news briefing.

Carmaker Ford said at the end of October it would close its Genk plant in eastern Belgium, which employs more than 4,000 workers, and move the work to Spain.

Belgium has an export-orientated economy and Coene said low growth in neighbouring countries would also hold back GDP.

The Belgian economy, the sixth largest in the euro zone, grew by 0.3 percent quarter-on-quarter in the first three months of this year, propelled by exports. However, it shrank by 0.5 percent in the second quarter and economic output was flat in the third.

The central bank expects Belgium’s national debt will rise to 100.6 percent of total output in 2012, from 97.8 percent in 2011, and sees the Belgian budget deficit at 2.8 percent this year.

The Belgian government, which took office a year ago, has pledged to cut the deficit to below 3 percent of GDP this year and to 2.15 percent in 2013, helped by almost 18 billion euros ($23 billion) in savings.

Those include measures to increase the effective retirement age to nearer the legal norm of 65, an increased tax on company cars and a cap on wage hikes.

However, it could need to go further, as the budget was predicated on a growth rate of 0.7 percent.

The Federal Plan Bureau, whose forecasts the government typically uses to draft budgets, has factored in a contraction of 0.1 percent this year and expansion of 0.7 percent in 2013. ($1 = 0.7735 euros) (Reporting By Ben Deighton; editing by Rex Merrifield)

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below