It is at crossroads of Western Europe with most West European capitals within 1000 kilometers of its capitol, Brussels. During the past 2,000 years has witnessed a constant ebb and flow of different races and cultures. Consequently, Belgium is one of Europe's true melting pots with Celtic, Roman, Germanic, French, Dutch, Spanish, and Austrian cultures having made an imprint.
Although generally flat, the terrain becomes increasingly hilly and forested in the southeast (Ardennes) region. Climate is cool, temperate, and rainy; summer temperatures average 77°F, winters average 45°F. Annual extremes (rarely attained) are 10°F and 100°F.
Begium is the seat of both the European Union and NATO.
Begium's environment is exposed to intense pressures from human activities: urbanization, dense transportation network, industry, extensive animal breeding and crop cultivation; air and water pollution also have repercussions for neighboring countries. Uncertainties regarding federal and regional responsibilities (now resolved) had slowed progress in tackling environmental challenges.
Belgium is susceptible to flooding along rivers and in areas of reclaimed coastal land which are protected from the sea by concrete dikes.
Belgium became independent from the Netherlands in 1830; it was occupied by Germany during World Wars I and II. The country prospered in the past half century as a modern, technologically advanced European state and member of NATO and the European Union.
Tensions between the Dutch-speaking Flemings of the north (58% of the population) and the French-speaking Walloons of the south (31%) have led in recent years to constitutional amendments granting these regions formal recognition and autonomy.
Location: Western Europe, bordering the North Sea, between France and the Netherlands
Geographic Coordinates: 50 50 N, 4 00 E
Area: total: 30,528 sq km (land: 30,278 sq km - water: 250 sq km)
Land Boundaries: 1,385 km (France 620 km, Germany 167 km, Luxembourg 148 km, Netherlands 450 km)
Coastline: 66.5 km
territorial sea: 12 nm
contiguous zone: 24 nm
exclusive economic zone: geographic coordinates define outer limit
continental shelf: median line with neighbors
Natural Hazards: flooding is a threat along rivers and in areas of reclaimed coastal land, protected from the sea by concrete dikes
Terrain: flat coastal plains in northwest, central rolling hills, rugged mountains of Ardennes Forest in southeast The highest point is Botrange (694 m) and the lowest point the North Sea (0 m).
Climate: temperate; mild winters, cool summers; rainy, humid, cloudy.
Ecology and Biodiversity
The Atlantic mixed forests ecoregion  is located at the western coast of the Eurasian continent including all of Belgium except for the southern part of the country. This ecoregion includes coastal vegetation formations of dunes and heathlands with vegetation that thrives in salty soil. Sand dune systems occur along the southwestern coast of France, the region known as Les Landes, covered by both natural and planted forests of maritime pine (Pinus pinaster). They are rich in plant life, and home to a number of endemics. The eastern limits are determined by the progressive disappearance of oceanic species and the appearance of continental species. The mammal fauna of the ecoregion is mostly composed of species widespread throughout Europe. Long-term human activities have wiped out most evident signs of natural forests, so it is difficult to establish a definitive biogeographic boundary. Only fragments of natural vegetation remain in this ecoregion, as most of the area was converted long ago into intensive agriculture (barley, wheat, sugar beets, and corn) or pasture.
The south is included within the Western European broadleaf forests ecoregion . This region includes the middle of France, extending into Germany. Warm, moist air from the Atlantic Ocean dominates this inland ecoregion. Small mountains (no higher than 5,000 feet [1,500 m]), hills, and valleys are found throughout the area. Yearly temperatures are steady, precipitation is fairly evenly distributed throughout the year, and frosts occur for one to three months. This ecoregion maintains healthy bird populations, but most of the larger mammals are in decline and have been extirpated from many areas. Throughout this ecoregion, the landscape is dominated by urbanization and agriculture, including vineyards and other monocultural plantings. Most streams have been altered for use in irrigation, and many valleys are flooded by dams constructed for increasing power and water supplies.
People and Society
Population: 10,438,353 (July 2012 est.)
Belgium is divided ethnically into the Dutch-speaking Flemings and French-speaking Walloons, the 75,000 residents of the eastern German cantons, and the bilingual capital of Brussels. The population density is the second highest in Europe, after the Netherlands.
Ethnic groups: Fleming 58%, Walloon 31%, mixed or other 11%
0-14 years: 15.9% (male 846,706/female 812,486)
15-64 years: 66.1% (male 3,475,404/female 3,416,060)
65 years and over: 18% (male 783,895/female 1,096,926) (2011 est.)
Population Growth Rate: 0.061% (2012 est.)
Birthrate: 10.03 births/1,000 population (2012 est.)
Death Rate: 10.63 deaths/1,000 population (July 2012 est.)
Net Migration Rate: 1.22 migrant(s)/1,000 population (2012 est.)
Life Expectancy at Birth: 79.65 years
male: 76.49 years
female: 82.95 years (2012 est.)
Total Fertility Rate: 1.65 children born/woman (2012 est.)
Belgium's Linguistic Divide: In August 1980, the Belgian Parliament passed a devolution bill and amended the Constitution, establishing "Community autonomy." As a result, in Flanders, the Flemish Parliament and government are competent for both regional and community affairs; in Wallonia, the Francophone Community Parliament and government are competent for community affairs, while the Walloon Regional Parliament and government are responsible for regional affairs. Subsequent constitutional reform established a community Parliament and government for the German-speaking cantons in 1983, and a regional Parliament and government for the Brussels Capital Region in 1989.
Languages: Dutch (official) 60%, French (official) 40%, German (official) less than 1%, legally bilingual (Dutch and French)
Literacy (age 15 and over can read and write): total population: 99%
Urbanization: 97% of total population (2010) growing at an annual rate of change of 0.4% (2010-15 est.)
Wallonia-Brussels Federation / French language area
|Brussels, the capital city and largest metropolitan area of Belgium. Source; Wikipedia|
|Steelmaking along the Meuse River at Ougrée, near Liège. Source: Wikipedia.|
|Sightseeing boat on a Brugge canal. The name of Brugge, often called the Venice of the North, is believed to come from the Old Norse word Bryggia meaning 'mooring place.' The canals were important in getting trading goods to their destination. Today, they are used exclusively for tourist boats.|
|The Church of Our Lady in Brugge. Built between the 13th and 15th centuries, it contains both Romanesque and Gothic features; its spire stretches upward for 122 m (401 ft) and remains the tallest structure in the city. The interior contains many important works of art.|
|This satellite photo shows Northwest Europe. Visible are the Republic of Ireland (top leftmost), the United Kingdom (top left), France (middle left), Belgium (middle), the Netherlands (top middle), Germany (right), Denmark (top right), Luxembourg (between France, Germany, and Belgium), Switzerland (bottom middle), Italy (bottom middle), and Austria (bottom right); the latter three all cloud covered. Image courtesy of NASA.|
Belgium derives its name from the Belgae, a Celtic tribe. The Belgae were forced to yield to Roman legions during the first century B.C. For some 300 years thereafter, what is now Belgium flourished as a province of Rome. But Rome's power gradually lessened. In about A.D. 300, Attila the Hun invaded what is now Germany and pushed Germanic tribes into northern Belgium. About 100 years later, the Germanic tribe of the Franks invaded and took possession of Belgium. The northern part of present-day Belgium became an overwhelmingly Germanized and Germanic-Frankish-speaking area, whereas in the southern part people continued to be Roman and spoke derivatives of Latin. After coming under the rule of the Dukes of Burgundy and, through marriage, passing into the possession of the Hapsburgs, Belgium was occupied by the Spanish (1519-1713) and the Austrians (1713-1794).
Under these various rulers, and especially during the 500 years from the 12th to the 17th century, the great cities of Ghent, Bruges, Brussels, and Antwerp took turns at being major European centers for commerce, industry (especially textiles), and art. Flemish painting--from Van Eyck and Breugel to Rubens and Van Dyck--became the most prized in Europe. Flemish tapestries hung on castle walls throughout Europe.
Following the French Revolution, Belgium was invaded and annexed by Napoleonic France in 1795. Following the defeat of Napoleon's army at the Battle of Waterloo, fought just a few miles south of Brussels, Belgium was separated from France and made part of the Netherlands by the Congress of Vienna in 1815.
In 1830, Belgium won its independence from the Dutch as a result of an uprising of the Belgian people. A constitutional monarchy was established in 1831, with a monarch invited in from the House of Saxe-Coburg Gotha in Germany.
Belgium was invaded by Germany in 1914 and again in 1940. Those invasions, plus disillusionment over postwar Soviet behavior, made Belgium one of the foremost advocates of collective security within the framework of European integration and the Atlantic partnership.
Since 1944, when British, Canadian, and American armies liberated Belgium, the country has lived in security and at a level of increased well-being.
Language, economic, and political differences between Dutch-speaking Flanders and Francophone Wallonia have led to increased divisions in Belgian society. The Industrial Revolution of the late 18th and the 19th century accentuated the linguistic North-South division. Francophone Wallonia became an early industrial boom area, affluent and politically dominant. Dutch-speaking Flanders remained agricultural and was economically and politically outdistanced by Brussels and Wallonia. The last 50 years have marked the rapid economic development of Flanders while the coal and steel industries of Wallonia went into sharp decline, resulting in a corresponding shift of political and economic power to the Flemish, who now constitute an absolute majority (58%) of the population.
Demonstrations in the early 1960s led to the establishment of a formal linguistic border in 1962, and elaborate rules made to protect minorities in linguistically mixed border areas. In 1970, Flemish and Francophone cultural councils were established with authority in matters of language and culture for the two-language groups. Each of the three economic regions--Flanders, Wallonia, and Brussels--was granted a significant measure of political autonomy.
Since 1984, the German language community of Belgium (in the eastern part of Liege Province) has had its own legislative assembly and executive, which have authority in cultural, language, and subsequently educational affairs.
In 1988-89, the Constitution was again amended to give additional responsibilities to the regions and communities. The most sweeping change was the devolution of educational responsibilities to the community level. As a result, the regions and communities were provided additional revenue, and Brussels was given its own legislative assembly and executive.
Another important constitutional reform occurred in the summer of 1993, changing Belgium from a unitary to a federal state. It also reformed the bicameral parliamentary system and provided for the direct election of the members of community and regional legislative councils. The bilingual Brabant province, which contained the Brussels region, was split into separate Flemish and Walloon Brabant provinces. The revised Constitution came into force in 1994.
As a parliamentary democracy, Belgium has been governed by successive coalitions of two or more political parties. The centrist Christian Democratic Party often provided the Prime Minister. In the 1999 general election, Belgian voters rejected Jean Luc Dehaene's longstanding coalition government of Christian Democrats and Socialists and voted into power a coalition led by Flemish Liberal Leader Guy Verhofstadt. The first Verhofstadt government (1999-2003) was a six-party coalition between the Flemish and Francophone Liberals, Socialists, and Greens. It was the first Liberal-led coalition in generations and the first six-party coalition in 20 years. It also was the first time the Greens had participated in Belgium's federal government. In the general election of 2003, the Greens suffered significant losses, while the Socialists posted strong gains and the Liberals also had modest growth in electoral support. Liberal Prime Minister Guy Verhofstadt reconstituted the coalition as a four-party government in July 2003, with only the Liberals and Socialists in power.
In the 2007 general elections, the Flemish Christian Democratic CD&V recouped the lost ground, becoming the country's largest party. The two Socialist parties and Prime Minister Guy Verhofstadt's Open VLD lost support. The Francophone Liberal MR became the largest party of Wallonia and Brussels. Following the election, the King tasked CD&V leader Yves Leterme with forming a new government. The ruling coalition was composed of Flemish Christian Democrats (CD&V), Francophone Christian Democrats (CDH), Flemish Liberals (Open VLD), Francophone Liberals (MR), and the Francophone Socialists (PS). However, it took over 9 months to form a government, which remained subject to intense strains. Leterme stepped down in December 2008 and was replaced as Prime Minister and head of the same coalition by the CD&V's Herman Van Rompuy.
Van Rompuy’s appointment as President of the European Council under the Treaty of Lisbon paved the way for Leterme to regain his position as Prime Minister in November 2009. However, an electoral dispute between the Francophone and Flemish parties continually plagued his government coalition, which finally collapsed in April 2010.
The Francophone Socialist (PS) and Flemish nationalist (New Flemish Alliance--N-VA) parties won the largest proportion of seats during parliamentary elections in June 2010. The N-VA became the largest party in the House of Representatives, winning 27 seats compared to 4 in 2007, indicating growing support for regional autonomy in Flanders. Throughout 2011, no governing coalition was formed due to continued inability of the Francophone and Flemish parties to reach a compromise over state reforms. Prime Minister Leterme and his cabinet remained in office in a caretaker capacity. In September 2011, the six negotiating parties achieved a breakthrough agreement on local government of an electoral district with a Francophone majority comprising both Brussels and parts of the surrounding Flemish region. The agreement was finalized in October 2011, with only the remaining hurdle of budget allocation among Belgium’s local regions. After further austerity measures were agreed to in November 2011, a new government with francophone Socialist Elio Di Rupo as Prime Minister was formed on December 5, 2011.
Belgium is a hereditary constitutional monarchy. The current monarch is King Albert II, who took the oath of office on August 9, 1993.
As titular head of state, the King plays a largely ceremonial and symbolic role in the nation. His primary political function is to designate a political leader to attempt to form a new cabinet following either an election, the resignation of a government, or a parliamentary vote of no confidence. The King is seen as playing a symbolic unifying role, representing a common national Belgian identity.
The Belgian Parliament consists of a Senate and a House of Representatives. The House of Representatives has 150 directly elected members. The Senate has 71 members. The executive branch of the government consists of ministers and secretaries of state (junior ministers) drawn from the political parties that form the government coalition. The number of ministers is limited to 15, and they have no seat in Parliament. The Council of Ministers is chaired by the Prime Minister and consists of the ministerial heads of the executive departments.
The allocation of powers between the Parliament and the Council of Ministers is somewhat similar to the United States--the Parliament enacts legislation and appropriates funds--but the Belgian Parliament does not have the same degree of independent power that the U.S. Congress has. Members of political parties represented in the government are expected to support all bills presented by the Cabinet. The House of Representatives is the "political" body that votes on motions of confidence and budgets. The Senate deals with long-term issues and votes on an equal footing with the Chamber on a limited range of matters, including constitutional reform bills and international treaties.
The parties in the current House are the New Flemish Alliance (N-VA) 27 seats; Francophone Socialists (PS) 26 seats; Francophone Liberals (MR) 18 seats; Christian Democrats (CD&V) 17 seats; Flemish Liberals (Open VLD) 13 seats; Flemish Socialists (SP.A) 13 seats; Flemish Interest (VB) 12 seats; Francophone Democratic and Humanist Center (CDH) 9 seats; Francophone Greens (Ecolo) 8 seats; Flemish Greens (Groen!) 5 seats; List Dedecker 1 seat; Francophone People’s Party (PP) 1 seat.
The Prime Minister and his ministers administer the government and the various public services. Ministers must defend their policies and performance in person before the House.
The Council of Ministers
At the federal level, executive power is wielded by the Council of Ministers. The Prime Minister chairs the Council. Each minister heads a governmental department. No single party or party "family" across linguistic lines holds an absolute majority of seats in Parliament. Consequently, the Council of Ministers reflects the weight of political parties that constitute the governing coalition in the House.
The Electoral System
The number of seats in the House of Representatives is constitutionally set at 150, elected from 11 electoral districts. Each district is given a number of seats proportional to its total population (not number of eligible voters) ranging from 4 for the Luxembourg district to 24 for Antwerp. The districts are divided along linguistic lines: 5 Flemish, 5 Walloon, and the bilingual district of Brussels-Halle-Vilvoorde.
The Senate consists of 71 seats. For electoral purposes, Senators are divided into three categories: 40 directly elected; 21 elected by the community parliaments; and 10 "co-opted" Senators. For the election of the 25 Flemish and 15 Francophone directly elected Senators, the country is divided into three electoral districts--Flanders, Wallonia, and the Brussels Capital Region. Of the 21 Senators representing the communities, 10 are elected by the Flemish Parliament, 10 by the French Community Parliament, and 1 by the German-language Parliament.
The remaining category, the 10 "co-opted" senators, are elected by the first two groups of senators. The princes and princesses of the royal line are also members of the Senate--currently Prince Philippe, Prince Laurent, and Princess Astrid.
In Belgium, there are no "national" parties operating on both sides of the linguistic border. Consequently, elections are a contest among Flemish parties in Dutch-speaking Flanders and Francophone parties in Wallonia. Only in officially bilingual Brussels can voters choose from either Flemish or Francophone parties. Several months before an election, the parties form a list of candidates for each district. Parties are allowed to place as many candidates on their "list" as there are seats available. The formation of the list is an internal process that varies with each party. The number of seats each party receives and where on a list a candidate is placed, or how many individual votes a candidate receives, determines whether a candidate is elected. Since no single party holds an absolute majority in Parliament, after each election the strongest party or "party family" will create a coalition with other parties to form the government. Voting is compulsory in Belgium; more than 90% of eligible voters participate.
Government Type: federal parliamentary democracy under a constitutional monarchy (King Albert II since 9 August 1993)
Capital: Brussels (population: 1.892 million - 2009)
Other major cities: Antwerp (population: 961,000 - 2009)
Administrative divisions: 3 regions (French: regions, singular - region; Dutch: gewesten, singular - gewest); Brussels-Capital Region, also known as Brussels Hoofdstedelijk Gewest (Dutch), Region de Bruxelles-Capitale (French long form), Bruxelles-Capitale (French short form); Flemish Region (Flanders), also known as Vlaams Gewest (Dutch long form), Vlaanderen (Dutch short form), Region Flamande (French long form), Flandre (French short form); Walloon Region (Wallonia), also known as Region Wallone (French long form), Wallonie (French short form), Waals Gewest (Dutch long form), Wallonie (Dutch short form)
note: as a result of the 1993 constitutional revision that furthered devolution into a federal state, there are now three levels of government (federal, regional, and linguistic community) with a complex division of responsibilities
The regional and community governments have jurisdiction over transportation, public works, water policy, cultural matters, education, public health, environment, housing, zoning, economic and industrial policy, agriculture, foreign trade, and oversight of provincial and local governments. They rely on a system of revenue sharing with the federal government for most of their funds. They have the authority to levy taxes (mostly surcharges) and contract loans. Moreover, they have obtained treaty-making power for those issues coming under their respective jurisdictions.
Of total public spending--interest payments not considered--more than 40% is authorized by the regions and communities.
Provincial and Local Government
In addition to three regions and three cultural communities, Belgium also is divided into 10 provinces and 589 municipalities.
The provincial governments are primarily administrative units and are politically weak. A governor appointed by the King presides over each province. Each governor is supported by an elected Provincial Council of 47 to 84 members (depending on the size of the province), which sits only 4 weeks a year.
Municipal governments, on the other hand, are vigorous political entities with significant powers and a history of independence dating from medieval times. Many national politicians originate from municipal political bases; and many often double as mayor or alderman in their hometowns in addition to their federal and regional political positions.
Independence Date: 4 October 1830 (a provisional government declared independence from the Netherlands); 21 July 1831 (King Leopold I ascended to the throne)
Legal System: civil law system based on the French Civil Code; note - Belgian law continues to be modified in conformance with the legislative norms mandated by the European Union; judicial review of legislative acts. belgium accepts compulsory International court of Justice (ICJ) jurisdiction with reservations and accepts international Criminal Court (ICCt) jurisdiction.
International Environmental Agreements
Belgium is party to international agreements on: Air Pollution, Air Pollution-Nitrogen Oxides, Air Pollution-Persistent Organic Pollutants, Air Pollution-Sulfur 85, Air Pollution-Sulfur 94, Air Pollution-Volatile Organic Compounds, Antarctic-Environmental Protocol, Antarctic-Marine Living Resources, Antarctic Seals, Antarctic Treaty, Biodiversity, Climate Change, Climate Change-Kyoto Protocol, Desertification, Endangered Species, Environmental Modification, Hazardous Wastes, Law of the Sea, Marine Dumping, Marine Life Conservation, Ozone Layer Protection, Ship Pollution, Tropical Timber 83, Tropical Timber 94, Wetlands, and Whaling.
Total Renewable Water Resources: 20.8 cu km (2005)
Freshwater Withdrawal: 7.44 cu km/yr (14% domestic, 85% industrial, 1% agricultural)
Per capita freshwater withdrawal:: 714 cu m/yr (1998)
Agricultural products: sugar beets, fresh vegetables, fruits, grain, tobacco; beef, veal, pork, milk
Irrigated Land: 230 sq km (2008)
Natural Resources: construction materials, silica sand, carbonates
This modern, open, and private-enterprise-based economy has capitalized on its central geographic location, highly developed transport network, and diversified industrial and commercial base. Industry is concentrated mainly in the more heavily-populated region of Flanders in the north.
Belgium, a highly developed market economy, belongs to the Organization for Economic Cooperation and Development (OECD), a group of leading industrialized democracies. In 2011, GDP was estimated to be €352 billion (approx. $467 billion). With a geographic area about equal to that of Maryland, and a population of 10.4 million, Belgian per capita GDP ranks among the world's highest. The federal government ran large primary surpluses in recent years until 2009. Public debt remains high, at about 96.8% of GDP at the end of 2011. GDP growth in 2011 was estimated to be 2.5%.
Densely populated Belgium is located at the heart of one of the world's most highly industrialized regions. The first country to undergo an industrial revolution on the continent of Europe in the early 1800s, Belgium developed an excellent transportation infrastructure of ports, canals, railways, and highways to integrate its industry with that of its neighbors. One of the founding members of the European Community (EC), Belgium strongly supports deepening the powers of the present-day European Union to integrate European economies further.
With exports and imports approximately equal to GDP, Belgium depends heavily on world trade. Belgium's trade advantages are derived from its central geographic location and a highly skilled, multilingual, and productive work force.
The Belgian industrial sector can be compared to a complex processing machine: It imports raw materials and semi-finished goods that are further processed and re-exported. Except for its coal, which is no longer economical to exploit, Belgium has virtually no natural resources. Nonetheless, most traditional industrial sectors are represented in the economy, including steel, textiles, refining, chemicals, food processing, pharmaceuticals, automobiles, electronics, and machinery fabrication. Despite the heavy industrial component, services account for 77.4% of GDP (2009). Agriculture accounts for only 1% of GDP.
Belgian Economy in the 20th Century
For 200 years through World War I, French-speaking Wallonia was a technically advanced, industrial region, while Dutch-speaking Flanders was predominantly agricultural. This disparity began to fade during the interwar period. As Belgium emerged from World War II with its industrial infrastructure relatively undamaged, the stage was set for a period of rapid development, particularly in Flanders. The postwar boom years contributed to the rapid expansion of light industry throughout most of Flanders, particularly along a corridor stretching between Brussels and Antwerp (now the second-largest port in Europe after Rotterdam), where a major concentration of petrochemical industries developed.
The older, traditional industries of Wallonia, particularly steelmaking, began to lose their competitive edge during this period, but the general growth of world prosperity masked this deterioration until the 1973 and 1979 oil price shocks sent the economy into a period of prolonged recession. In the 1980s and 1990s, the economic center of the country continued to shift northward to Flanders.
Foreign investment contributed significantly to Belgian economic growth in the 1960s. In particular, U.S. firms played a leading role in the expansion of light industrial and petrochemical industries in the 1960s and 1970s. The Belgian Government encourages new foreign investment as a means to promote employment. With regional devolution, Flanders, Brussels, and Wallonia now have substantial autonomy in courting potential foreign investors, as each deems appropriate.
Foreign direct investment (stock) totaled more than $705 billion (cumulative) in 2009. U.S. and other foreign companies in Belgium account for approximately 11% of the total work force, with the U.S. share at about 6%. U.S. companies are heavily represented in the chemical sector, automotive assembly, petroleum refining, and pharmaceutical sectors. A number of U.S. service industries followed in the wake of these investments--banks, law firms, public relations, accounting, and executive search firms. The resident American community in Belgium now exceeds 20,000. Attracted by the EU 1992 single-market program, many U.S. law firms and lawyers have settled in Brussels since 1989.
On May 1, 1998, Belgium became a first-tier member of the European Monetary Union. Belgium switched from the Belgian franc (BF) to the Euro as its currency after January 1, 2002.
Most of Belgium's trade is with fellow EU member states. As a result, Belgium seeks to diversify and expand trade opportunities with non-EC countries. Through November 2011, Belgium ranked as the 14th-largest market for the export of U.S. goods.
Bilaterally, there are few points of friction with the U.S. in the trade and economic area. The Belgian authorities are, as a rule, anti-protectionist and try to maintain a hospitable and open trade and investment climate. As a result, the U.S. Government focuses its market-opening efforts on the EU Commission and larger member states. Moreover, the Commission negotiates on trade issues for all member states, which in turn lessens bilateral trade disputes with Belgium.
The social security system, which expanded rapidly during the prosperous 1950s and 1960s, includes a medical system, unemployment insurance coverage, child allowances, invalid benefits, and other benefits and pensions. With the onset of a recession in the 1970s, this system became an increasing burden on the economy and accounted for much of the government budget deficits. The national unemployment figures mask considerable differences between Flanders and Wallonia. Unemployment in Wallonia is mainly structural, while in Flanders it is cyclical. Flanders' unemployment level equals only half that of Wallonia. The southern region continues a difficult transition out of sunset industries (mainly coal and steel), while sunrise industries (chemicals, high-tech, and services) dominate in Flanders.
Belgium's unemployment rate was 7.0% in November 2011. A total of 4.47 million people make up Belgium's labor force. The majority of these people (73%) work in the service sector. Belgian industry claims 25% of the labor force and agriculture only 2%. As in other industrialized nations, pension and other social entitlement programs have become a major concern as the "baby boom" generation approaches retirement.
Although Belgium is a wealthy country, public expenditures far exceeded income for many years, and taxes were not diligently pursued. The Belgian Government reacted with poor macroeconomic policies to the 1973 and 1979 oil price hikes by hiring the redundant work force into the public sector and subsidizing industries like coal, steel, textiles, glass, and shipbuilding, which had lost their international competitive edge. As a result, cumulative government debt reached 121% of GDP by the end of the 1980s. However, thanks to Belgium's high personal savings rate, the Belgian Government financed the deficit from mainly domestic savings, minimizing the deleterious effects on the overall economy.
The federal government ran a 7.1% budget deficit in 1992 at the time of the EU's Treaty of Maastricht, which established conditions for Economic and Monetary Union (EMU) that led to adoption of the common Euro currency on January 1, 2002. Among other criteria spelled out under the Maastricht treaty, the Belgian Government had to attain a budget deficit of no greater than 3% of GDP by the end of 1997; Belgium achieved this, with a total budget deficit in 2001 (just prior to implementation of the Euro currency) that amounted to 0.2% of GDP.
The government had a positive primary balance between 1993 and 2007, during which time Belgium’s debt to GDP level fell from 133% to just over 84%. In 2009, due to the financial and economic crisis, Belgium’s deficit and debt levels increased to 6% and 96.2% of GDP respectively, with debt rising to close to 97% of GDP in 2010. Thanks to improving economic growth, Belgium’s budget deficit was 4.6% in 2010 and 3.0% in 2011. According to the country’s Stability Program, the deficit is planned to remain 3.0% in 2012.
An ageing population and rising social expenditures are mid- to long-term challenges to public finances.
GDP: (Purchasing Power Parity): $394.3 billion (2010 est.)
GDP: (Official Exchange Rate): $465.7 billion (2010 est.)
GDP- per capita (PPP): $37,800 (2010 est.)
GDP- composition by sector:
services: 77.4% (2010 est.)
Industries: engineering and metal products, motor vehicle assembly, transportation equipment, scientific instruments, processed food and beverages, chemicals, basic metals, textiles, glass, petroleum
Currency: Euros (EUR)