It is now official, Belgium will be able to benefit from 4,524,565 million euros in subsidies within the framework of the European recovery plan following the pandemic. The majority of this sum (70%) was already fixed, and the remaining 30% was determined taking into account the impact of the pandemic on the country’s economy in 2020 and 2021.
The total amount is finally about 1.4 billion euros lower than the first estimates of autumn 2020, due to the recovery of the Belgian economy faster than expected. The forecast for Belgian GDP was indeed -4.6% over the period 2020 and 2021, while the latest estimates amount to +0.1%.
Long anticipated drop
“Although we can be pleased with our good economic performance, an ex-post review of such magnitude is not ideal for investment planning”regrets Thomas Dermine, Secretary of State for Recovery.
However, this drop was long anticipated by the government. The Kern of April 22 had already made the commitment to compensate for the loss of European subsidies by other sources of financing and to continue the implementation of recovery projects despite the expected reduction in the envelope. “Belgium has been chronically under-investing for more than thirty years. However, the energy, climate and digital challenges call for massive public investment”, supplements the Secretary of State.
It is now a matter of discussing with the federated entities how best to adjust the European plan to the envelope of subsidies available. This will be the mission of the Consultation Committee on July 13th. The submission of the adjusted plan to the Commission is scheduled for the autumn.