2022 OECD ECONOMIC SURVEY OF BELGIUM Brussels, 14 June 2022
Towards a resilient and sustainable recovery @OECDeconomy
@OECD
Web: oe.cd/belgium
GDP has recovered from the pandemic Real GDP Index, 2019Q4 = 100
Source: OECD, Economic Outlook (database).
2
Headline inflation increased sharply – Core inflation also rising but remains significantly lower Inflation Y-o-y % change
Source: Eurostat.
3
Confidence has fallen Business and consumer confidence Balance, seasonally adjusted
Source: Eurostat.
4
Labour shortages have increased Vacancies Job vacancy rate, %
Source: Eurostat.
5
There are large regional disparities in unemployment rates Unemployment rate %
Source: National Bank of Belgium; and Statistics Belgium.
6
The pace of the recovery will moderate Annual percentage change
Gross domestic product Consumer price index (harmonised) Unemployment rate (%) Fiscal balance (% of GDP) Public debt (Maastricht, % of GDP)
Source: OECD, Economic Outlook (database).
2021 6.2 3.2 6.3 -5.5 108.4
2022 2.4 9.0 6.0 -5.6 106.1
2023 1.0 4.8 6.4 -4.8 107.2
7
Strengthening fiscal sustainability
8
The pandemic has increased public debt Public debt Maastricht definition, % of GDP
Source: OECD Economic Outlook (database). 9
Medium-term fiscal challenges are important Illustrative simulations of gross government debt Maastricht definition, % of GDP
Source: Adapted from OECD Economic Outlook (database); and Long-term baseline projections; European Commission (2021), The Ageing Report. 10
Public spending is high Public spending 2021 or latest, % of GDP
Source: OECD, Economic Outlook (database).
11
The actual retirement age is low Age of labour market exit 2020, men and women
Source: OECD (2021), Pensions at a Glance.
12
A revenue-neutral tax reform should continue to shift taxes away from labour Tax mix 2020, % of total revenue
Source: OECD, Global Revenue Statistics 2022.
13
The average tax wedge is high Tax wedge 2021, % of labour costs
Note: Tax wedge is defined as the ratio between the amount of taxes paid by an average single worker (a single person at 100% of average earnings) without children and the corresponding total labour cost for the employer. Source: OECD (2022), Taxing Wages (database).
14
Improving economic opportunities for all
15
Employment remains low compared to peers Employment rate 2021, % of population aged 20-64
Source: Eurostat.
16
Employment gaps are large for vulnerable groups Employment gap with prime-age men (aged 25-54 years) 2020, %
Source: OECD calculations based on OECD Employment Database, OECD International Migration Database, OECD Education Database and OECD Family Database. 17
The share of disability benefit recipients has increased Recipients of disability benefits % of population
Source: National Institute for Sickness and Disability Insurance.
18
Low-income parents face weak work incentives Participation tax rate for unemployed single parents % of gross earnings, 2021 or latest
Note: The participation tax rate is an indicator representing the share of additional earnings form work that is lost due to reduced benefits and increased taxes Source: OECD, Social Protection and Well-Being Database.
19
Student achievement depends on socio-economic background Percentage of variance in reading performance explained by socio-economic background, 2018
Note: OECD calculations based on regressions of PISA reading scores and ESCS (PISA index of economic, social and cultural status). Source: OECD (2021), Government at a Glance; Pisa 2018 Database.
20
Housing affordability is a concern Share of low-income household overburdened by housing costs 2019, % of household on the private rental market
Note: Households on the private rental market; low-income households belong to the bottom income quintile; overburden is more than 40% of disposable income on total housing costs. Source: OECD, Affordable Housing Database.
21
Boosting productivity growth and advancing the green transition
22
Productivity growth is weak Labour productivity growth 2010-2020, average annual growth
Source: OECD, Productivity Database.
23
The green and energy transitions require bold efforts Greenhouse gases emissions and projections Tonnes of CO2 equivalent
Note: GHG emissions excluding LULUCF. Non-ETS targets: under the EU Effort Sharing legislation. Does not reflect proposals under the EU “Fit for 55” package. Source: OECD (2021), Environmental Performance Reviews: Belgium.
24
Climate policies should be coordinated across different levels of government Share of subnational governments in public expenditure 2020, % total
Source: Eurostat.
25
For more information Disclaimers: The statistical data for Israel are supplied by and under the responsibility of the relevant Israeli authorities. The use of such data by the OECD is without prejudice to the status of the Golan Heights, East Jerusalem and Israeli settlements in the West Bank under the terms of international law. This document and any map included herein are without prejudice to the status of or sovereignty over any territory, to the delimitation of international frontiers and boundaries and to the name of any territory, city or area.
oe.cd/belgium
OECD Economics OECD 26