Predictions for Belgium’s economy darken, even without more coronavirus measures
Tuesday, 23 March 2021
Photo by Markus Winkler on Unsplash
The outlook for businesses in Belgium in 2021 and 2022 has deteriorated slightly since the last predictions, even before accounting for the recent rise in coronavirus infections that has the country considering another lockdown.
While an upturn in non-medical contact occupations improved the total loss of revenue related to the global pandemic from 10% to 9%, the average Belgian company is expecting incomes to be 18% lower than normal overall this year.
And those businesses that were able to reopen are now facing the prospect of closing back down.
The data comes from the new ERMG (Economic Risk Management Group) survey of Belgian companies, carried out at the beginning of last week. In other words, before the relaxations were postponed during the Consultative Committee meeting last Friday. Another meeting is scheduled for this coming Friday.
The results therefore don’t generally reflect the greater likelihood of further restrictive measures being imposed.
“The investment outlook improved slightly in March but remains relatively bleak nonetheless,” ERMG said in their report.
Losses are even greater in the hotel and catering sector (expected to lose over 20% of their revenue), along with the arts, entertainment, and recreation sectors. The most affected sectors are expected to see a 10% reduction in employment.
“The final impact on employment will also depend on the success of labor market policies aimed at facilitating transitions between industries,” the report says.
The Belgian economy will still be feeling the effects of the pandemic in 2022, as well. Profits for that year are expected to be 11% lower than normal.
The survey also found that many companies – particularly in Brussels – plan to significantly reduce their office space per employee (by about 9% on average) over the next five years, likely due to the increase in teleworking.
The objective of ERMG’s survey was to assess the impact of the coronavirus crisis and restrictive measures on economic activity. The group was set up by the government around this time last year in order to analyse and combat the economic consequences of the coronavirus pandemic.