The National Productivity Council (CNP) has emphasised the need for productivity growth to become a key political priority in its annual report released on Thursday.
To illustrate the importance of productivity growth, the CNP cites the budgetary cost of an ageing population. “If the average annual growth of labour productivity increased from 1.2% to 1.3%, the budgetary cost of ageing would decrease by 0.6 percentage points of GDP over the period 2023-2070,” the report explains.
According to the CNP, climate change, technological transition, and geopolitical challenges also demand additional investments. Without economic growth, these can only be financed by reducing consumption and/or would place further strain on public finances.
The CNP notes that the declining trend in productivity growth, which began in the late 1970s and accelerated after the 2008 global financial crisis, has worsened due to recent successive crises.
While the average annual growth rate of labour productivity was 0.7% in Belgium for the period 2000-2023, it dropped to 0.5% for the period 2019-2023, the report states.
In its annual report, the CNP highlights two key drivers of productivity growth: investing in the widespread adoption of artificial intelligence (AI) and ensuring sufficient public investments.
The CNP stresses the importance of pursuing a medium-term fiscal consolidation strategy combined with investments and reforms that promote higher sustainable economic growth.
