Belgium’s economy is projected to maintain stable growth of 0.3% in the final quarter of 2024, according to recent statistics and projections by economic monitoring authorities. This estimate matches the country’s third-quarter growth rate of 0.3%, which slightly exceeded the earlier forecast of 0.2% reported in the September 2024 Business Cycle Monitor (BCM) and the National Accounts Institute’s (NAI) flash estimate.
In the third quarter, household consumption emerged as a key driver of economic expansion. The modest rebound in consumer sentiment during this period supported increased spending, even as the underlying economic fundamentals remained weak. However, recent data indicate a slight deterioration in consumer sentiment since the third quarter, suggesting that household consumption will likely decelerate in the fourth quarter, though it is expected to remain positive overall.
Business investment growth presented a less optimistic picture in the third quarter, recording negative performance. While short-term drivers for business investment remain weak, a moderate recovery is anticipated in the current quarter. This improvement will likely contribute to overall economic activity, albeit at a restrained pace.
Net exports, another important component of GDP, detracted from growth in the third quarter. Persistently high energy prices across Europe and subdued trade activity have weighed on export performance. Nevertheless, Belgium’s export market share is expected to benefit from improving cost competitiveness as wage growth continues to decelerate. As a result, the contribution of net exports to GDP growth in the fourth quarter is anticipated to remain broadly stable.
Government spending is forecast to play a more supportive role in the final quarter of 2024. Consumption growth by the government is likely to rebound, while investment growth is set to benefit from the electoral cycle and the rollout of large-scale infrastructure and investment programs.
The BCM introduced a new suite of nowcasting models to refine growth projections. Brel Jr. estimates a 0.2% GDP growth rate for the fourth quarter, Bosphorus forecasts 0.1%, and C3PO predicts 0.2%. The median of one-indicator models suggests a higher growth rate of 0.5%. However, the consensus among analysts points to a 0.3% growth rate as the most plausible scenario for the quarter.
Belgium’s economic outlook for the fourth quarter reflects a mixed but stable trajectory. While household consumption is expected to slow and business investment remains subdued, positive contributions from government spending and incremental gains in export competitiveness are set to provide balance.
As Belgium approaches 2025, its economy continues to navigate a challenging global environment marked by high energy prices and trade uncertainties. Nevertheless, the resilience shown in household spending, coupled with strategic government investments, positions the country for measured but steady growth.