Belgium is facing growing fiscal pressures, with its budget deficit expected to reach 5.3% of gross domestic product (GDP) this year.
If no new measures are introduced, the deficit could rise to 5.5% in 2026, and 5.9% in 2027, according to the latest forecasts from the European Commission. The country's national debt is also expected to continue increasing.
While the European economy is expected to grow by 1.4% this year despite trade tensions with the United States, Belgium's finances are under strain. Rising costs linked to an ageing population, higher defence spending and interest payments are pushing the deficit higher.
The situation is further complicated by the fact that the Federal Government has not yet agreed on a full budget for 2026. Policymakers are under pressure to find a way to support economic growth while keeping public finances sustainable.
Belgium's Prime Minister Bart De Wever (N-VA) during a plenary session in the Federal Parliament in Brussels, Thursday 16 October 2025. Credit: Belga/Jonas Roosens
Belgium is already subject to the European excessive deficit procedure, which requires the deficit to fall below 3% by the end of the legislative term in 2029. However, Prime Minister Bart De Wever's (N-VA) government has struggled to finalise a multi-year budget.
Economic growth is expected to remain modest but steady; Belgium's economy is projected to expand slightly in the coming years, helped by foreign demand and increased investment.
However, domestic consumption is likely to be constrained by limited employment growth and ongoing inflationary pressures. The unemployment rate is expected to edge up slightly, while inflation should ease gradually.
Game over?
Meanwhile, budget concerns remain acute. Among eurozone countries, only France is projected to have a larger deficit this year. While France's deficit is expected to fall next year, Belgium's is forecast to continue rising.
Facing these figures, De Wever has proposed €10 billion in budget cuts by 2029, including an index jump, slower growth in healthcare spending and a potential VAT increase.
The latter is opposed by coalition partner MR (French-speaking liberals), delaying agreement on the 2026 budget. De Wever has set Christmas as the deadline for a deal, cautioning that if no agreement is reached, "it's game over" for his government.
