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    Local finance: investment continued to decline in 2016

    © Belga
    © Belga

    In 2016, investments by local authorities amounted to 3.1 billion euros, down almost 30% from the 4 billion invested in 2012, according to the Belfius annual study, which focuses on the financing of local authorities in Belgium. “If this reduction is to be put into perspective by the fact that 2012 was an electoral year at the local level, characterised by a high level of investment, it should be pointed out that the recovery of investments that traditionally appears towards the middle of the mandate was not seen in 2016 and that, on the contrary, the decline continued”, Belfius officials said on the occasion of the presentation of the results of the study.

    This “historically low” level of local investment – which accounts for 0.7% of GDP – further aggravates the level of under-investment of the entire public sector in Belgium (2.3% of GDP compared to an average of about 3% for the European Union), they continued.

    Local government expenditure stabilised at 29.7 billion euros, representing 13.2% of total public expenditure, while their financing balance continued to improve (+267 million euros in 2015, +683 million in 2016). As for their debt, they have come back under the 24 billion euro mark. “Overall, local authorities are reporting good fiscal performance in the framework of the European fiscal stability pact”, Belfius concluded.

    Maria Novak
    The Brussels Times