The Brussels-Capital Region Government will cut millions of euros worth of export subsidies from 2024, in a move condemned as "incomprehensible" by business executives who argue that it could lead to a mass exodus of firms from the Belgian capital.
The decision to abolish roughly €4 million in public funding, which is used by hundreds of businesses each year to cover trips abroad, produce foreign advertising material, and hire external consultants, was reportedly taken by the city's Secretary of State for International Relations Ans Persoons (Vooruit) during last month's highly contentious budget negotiations.
The cut comes as part of a wider plan to address Brussels' soaring levels of public debt, which have nearly tripled to €13 billion over the past five years.
Brussels Secretary of State for International Relations Ans Persoons. Credit: Belga / Thierry Roge
"It's undoubtedly incomprehensible, if you want to further the image of Brussels internationally," said Olivier Willocx, the CEO of Brussels Enterprises Commerce and Industry (BECI), which represents over 35,000 companies in the Belgian capital.
"It seems it's the will of [Persoons]," he added. "We will likely see that it will lead to the relocation of a number of companies elsewhere, notably Flanders and Wallonia."
Willocx's words were echoed by Thibaut Martens of Subsiconseils, a consultancy that advises firms on how to obtain government subsidies, who described the elimination of the funding as "damaging for hundreds of companies".
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"We understand that it is necessary to review the eligibility conditions for these subsidies," he said. "But the decision is so unilateral and sudden... Brussels companies will suffer. This will encourage them to flee to Wallonia and Flanders."
Speaking to the Brussels Parliament on Monday, Persoons sought to downplay the significance of the budget cuts while also claiming that they are necessary to address the city's surging debt levels.
"We have to make budget cuts," she said. "Every choice will be difficult and we will be told that it was not the right one. We will take a break in 2024 to evaluate the instrument and see how to make it more effective in the future."
Brussels' mounting debt comes against the backdrop of a deepening fiscal crisis across the rest of Belgium. According to the Eurostat, the EU's official statistics office, Belgium's total government debt-to-GDP ratio of 107.4% is the sixth highest in the bloc and nearly twice the EU's 60% legal threshold.
