Abstract
BELGIUM
Title Page
BELGIUM
STAFF REPORT FOR THE 2022 ARTICLE IV CONSULTATION—INFORMATIONAL ANNEX
February 9, 2023
Prepared by:
IMF European Department
Contents
FUND RELATIONS
STATISTICAL ISSUES
Fund Relations
(As of December 31, 2022)
Membership Status: Joined December 27, 1945; Article VIII.
General Resources Account:
| SDR Million | Percent of Quota | |
| Quota | 6,410.70 | 100.00 |
| IMF’s Holdings of Currency (Holdings Rate) | 4,640.78 | 72.39 |
| Reserve Tranche Position | 1,769.95 | 27.61 |
| Lending to the Fund | ||
| New Arrangements to Borrow | 38.28 |
| SDR Million | Percent of Quota | |
| Quota | 6,410.70 | 100.00 |
| IMF’s Holdings of Currency (Holdings Rate) | 4,640.78 | 72.39 |
| Reserve Tranche Position | 1,769.95 | 27.61 |
| Lending to the Fund | ||
| New Arrangements to Borrow | 38.28 |
SDR Department:
| SDR Million | Percent of Allocation | |
| Net Cumulative Allocation | 10,467.71 | 100.00 |
| Holdings | 10,67401 | 101.97 |
| SDR Million | Percent of Allocation | |
| Net Cumulative Allocation | 10,467.71 | 100.00 |
| Holdings | 10,67401 | 101.97 |
Outstanding Purchases and Loans: None
Latest Financial Arrangements:
| Type | Date of Arrangement | Expiration Date | Amount Approved (SDR Million) | Amount Drawn (SDR Million) |
| Stand-By | Jun 19, 1952 | Jun 18, 1957 | 50.00 | 50.00 |
| Type | Date of Arrangement | Expiration Date | Amount Approved (SDR Million) | Amount Drawn (SDR Million) |
| Stand-By | Jun 19, 1952 | Jun 18, 1957 | 50.00 | 50.00 |
Overdue Obligations and Projected Payments to Fund 1/
(SDR Million; based on existing use of resources and present holdings of SDRs):
When a member has overdue financial obligations outstanding for more than three months, the amount of such arrears will be shown in this section.
| Forthcoming | |||||
| 2023 | 2024 | 2025 | 2026 | 2027 | |
| Principal | |||||
| Charges/Interest | 0.13 | 0.13 | 0.13 | 0.13 | 0.13 |
| Total | 0.13 | 0.13 | 0.13 | 0.13 | 0.13 |
When a member has overdue financial obligations outstanding for more than three months, the amount of such arrears will be shown in this section.
| Forthcoming | |||||
| 2023 | 2024 | 2025 | 2026 | 2027 | |
| Principal | |||||
| Charges/Interest | 0.13 | 0.13 | 0.13 | 0.13 | 0.13 |
| Total | 0.13 | 0.13 | 0.13 | 0.13 | 0.13 |
When a member has overdue financial obligations outstanding for more than three months, the amount of such arrears will be shown in this section.
Implementation of HIPC Initiative: Not applicable
Safeguards Assessments: Not applicable
Exchange Rate Arrangements:
The exchange rate arrangement of the euro area is free floating. Belgium participates in a currency union (EMU) with 19 other members of the EU and has no separate legal tender. The euro, the common currency, floats freely and independently against other currencies. Belgium has accepted the obligations under Article VIII, Section 2(a), 3, and 4 of the IMF’s Articles of Agreement, and maintains an exchange system free of multiple currency practices and restrictions on the making of payment and transfers for current international transactions, except for restrictions maintained solely for security reasons, which have been notified to the Fund pursuant to Executive Board Decision No. 144-(52/51).
Last Article IV Consultation:
The last Article IV consultation was concluded on September 8, 2021. The Executive Board assessment and the staff report (IMF Country Report No. 21/209) are available at link. Belgium is on the standard 12-month consultation cycle.
Capacity Development (CD)
Belgium has received direct IMF technical assistance since the last Article IV consultation in two areas—through a review of tax policy analysis and proposals that were utilized in a tax reform blueprint issued by the Deputy Prime Minister and Finance Minister in July 2022 and in support for analysis of gaps in revenue collections under Belgium’s value-added tax.
Belgium is an important financial supporter of IMF externally-financed capacity development (technical assistance and training), including country-specific and regional projects as well as IMF multi-partner CD vehicles (regional and thematic trust funds and CD centers). Belgium has also been a financial supporter of other IMF initiatives, including for low-income countries via the Poverty Reduction and Growth Trust and for debt relief.
Financial Sector Assessment Program (FSAP) Participation:
Belgium: Financial System Stability Assessment
IMF Country Report
No. 18/67
Summary: The FSAP conducted in late 2017 concluded that the Belgian financial sector has become more resilient as a result of structural changes experienced since the global financial crisis, but is facing growing vulnerabilities, mostly in the form of risky mortgages. Nonetheless, banks and insurance companies remain capable of absorbing credit, sovereign, and market losses in the event of a severe deterioration in macro financial conditions. To contain rising mortgage-related risks, macroprudential policies recently proposed by the NBB should be enacted promptly. Other risks, including banks’ capacity to cope with interest rate shocks, credit risk vulnerabilities in selected portfolios, and growing liquidity risk in insurance companies, should be monitored closely.
Financial sector supervision and crisis management arrangements have been upgraded markedly. However, the transition to a full banking union must be carefully managed by national and European authorities given the presence in Belgium of large subsidiaries of euro area banks. Sufficient capital and loss absorbing capacity should be kept in these subsidiaries to ensure the viability of group resolution strategies. The NBB and European authorities should continue ongoing efforts to upgrade their supervisory and crisis management frameworks and operational capacity, including by prioritizing the resolution planning for important banks and strengthening the deposit insurance system. It will also be important to address the challenges posed by complex financial conglomerates, ongoing changes in the risk profile of the insurance sector, and potential challenges arising from the low quality of some insurers’ capital.
The oversight arrangement for the Belgium-based Society for Worldwide Interbank Financial Telecommunication (SWIFT) has proven effective but is being challenged by new risks. To strengthen the NBB’s ability to exercise its role as overseer and protect Belgium’s reputation as a key hub for financial market infrastructures, the authorities should consider complementing the NBB’s use of moral suasion with regulatory and supervisory powers and should enhance the NBB’s ability to share information with foreign authorities.
The next FSAP assessment was launched with a scoping mission in late 2022 and will be aligned with the 2023 Article IV consultation cycle with Belgium.
Anti-Money Laundering/Combating the Financing of Terrorism (AML/CFT):
Belgium underwent a mutual evaluation of its AML/CFT regime by the Financial Action Task Force (FATF) in 2015. The FATF 2015 report noted that Belgium has the core elements of a sound AML/CFT regime, although some elements are not yet fully in line with the 2012 FATF Recommendations. Following the adoption of the mutual evaluation report, Belgium was placed in enhanced follow-up process. The latest report in September 2018 (third enhanced follow-up) noted Belgium’s progress in strengthening its framework to tackle money laundering and terrorist financing since the mutual evaluation. However, efforts need to continue to fully implement the FATF Standard, including Recommendations 13 and 14 on corresponding banking, and money and value transfer services.
Statistical Issues
As of January 31, 2023
| I. Assessment of Data Adequacy for Surveillance |
| General. Belgium’s economic and financial statistics are adequate for surveillance purposes. The National Bank of Belgium (NBB) regularly publishes a full range of economic and financial data and provides calendar dates of main statistical releases. |
| National Accounts. Belgium adopted the European System of Integrated Economic Accounts 2010 (ESA 2010) in 2014. Revisions of national accounts were released in September 2014 to comply with EUROSTAT requirements to provide national accounts statistics in ESA 2010. The NBB is responsible for compiling the national accounts statistics. Quarterly accounts are published within a lag of three months. Both annual and quarterly accounts data are of good quality, with shortcomings mainly related to export and import deflators, which are based on unit values rather than prices collected directly from exporters and importers. |
| Price Statistics. A consumer price index and industrial producer price index are compiled according to best practices and published monthly. Producer price indexes for services activities are disseminated quarterly. |
| Government Finance Statistics. Belgium compiles and publishes a complete set of general government accounts on an accrual basis (ESA 2010). The NBB publishes annual and quarterly data on general government revenue, expenditure, and net lending/borrowing; transactions in financial assets and liabilities and a financial balance sheet data; and details on the consolidated gross debt. |
| Monetary and Financial Statistics. Monetary and financial statistics data are available in standardized report forms – SRF 1SR for central bank, SRF 2SR for other depository corporations. The data are disseminated on a monthly basis through the International Financial Statistics. The NBB also reports data on some key series of the Financial Access Survey (FAS), including mobile and internet banking information. |
| Financial Sector Surveillance. Belgium reports financial soundness indicators (FSIs) to STA on a quarterly frequency, including 16 core FSIs and eight encouraged FSIs for deposit takers, and nine encouraged FSIs for other sectors. |
| II. Data Standards and Quality |
| Belgium adheres to the IMF’s Special Data Dissemination Standard (SDDS) Plus since January 26, 2023, and publishes the data on its National Summary Data Page. The latest Annual Observance Report is available on the Dissemination Standards Bulletin Board. |
| I. Assessment of Data Adequacy for Surveillance |
| General. Belgium’s economic and financial statistics are adequate for surveillance purposes. The National Bank of Belgium (NBB) regularly publishes a full range of economic and financial data and provides calendar dates of main statistical releases. |
| National Accounts. Belgium adopted the European System of Integrated Economic Accounts 2010 (ESA 2010) in 2014. Revisions of national accounts were released in September 2014 to comply with EUROSTAT requirements to provide national accounts statistics in ESA 2010. The NBB is responsible for compiling the national accounts statistics. Quarterly accounts are published within a lag of three months. Both annual and quarterly accounts data are of good quality, with shortcomings mainly related to export and import deflators, which are based on unit values rather than prices collected directly from exporters and importers. |
| Price Statistics. A consumer price index and industrial producer price index are compiled according to best practices and published monthly. Producer price indexes for services activities are disseminated quarterly. |
| Government Finance Statistics. Belgium compiles and publishes a complete set of general government accounts on an accrual basis (ESA 2010). The NBB publishes annual and quarterly data on general government revenue, expenditure, and net lending/borrowing; transactions in financial assets and liabilities and a financial balance sheet data; and details on the consolidated gross debt. |
| Monetary and Financial Statistics. Monetary and financial statistics data are available in standardized report forms – SRF 1SR for central bank, SRF 2SR for other depository corporations. The data are disseminated on a monthly basis through the International Financial Statistics. The NBB also reports data on some key series of the Financial Access Survey (FAS), including mobile and internet banking information. |
| Financial Sector Surveillance. Belgium reports financial soundness indicators (FSIs) to STA on a quarterly frequency, including 16 core FSIs and eight encouraged FSIs for deposit takers, and nine encouraged FSIs for other sectors. |
| II. Data Standards and Quality |
| Belgium adheres to the IMF’s Special Data Dissemination Standard (SDDS) Plus since January 26, 2023, and publishes the data on its National Summary Data Page. The latest Annual Observance Report is available on the Dissemination Standards Bulletin Board. |
Key Publicly Accessible Websites for Macroeconomic Data and Analysis:
NBB.Stat, http://stat.nbb.be/?lang=en
National Statistics Institute, www.statbel.fgov.be
National Bank of Belgium, www.nbb.be
Federal Planning Bureau, www.plan.be
High Council of Finance, https://www.highcounciloffinance.be
Central Economic Council, www.ccecrb.fgov.be
Belgium: Table of Common Indicators Required for Surveillance
(As of January 31, 2023)
Includes reserve assets pledged or otherwise encumbered as well as net derivative positions.
Both market-based and officially-determined, including discount rates, money market rates, and rates on treasury bills, notes and bonds.
Foreign, domestic bank, and domestic nonbank financing.
The general government consists of the central government (budgetary funds, extra budgetary funds, and social security funds), and state and local governments.
This information is provided on a budget-accounting basis (not on a national accounts basis).
Daily (D), weekly (W), monthly (M), quarterly (Q), annually (A), irregular (I), and not available (NA)
Belgium: Table of Common Indicators Required for Surveillance
(As of January 31, 2023)
| Date of latest observation | Date received | Frequency of Data6 | Frequency of Reporting6 | Frequency of Publication6 | |
|---|---|---|---|---|---|
| Exchange Rates | Jan.2023 | Jan.2023 | D | D | D |
| International Reserve Assets and Reserve Liabilities of the Monetary Authorities1 | Dec.2022 | Jan.2023 | M | M | M |
| International Investment Position | Q3:2022 | Dec.2022 | Q | Q | Q |
| Reserve/Base Money | Dec.2022 | Jan.2023 | M | M | M |
| Broad Money | Dec.2022 | Jan.2023 | M | M | M |
| Central Bank Balance Sheet | Dec.2022 | Jan.2023 | M | M | M |
| Consolidated Balance Sheet of the Banking System | Dec.2022 | Jan.2023 | M | M | M |
| Interest Rates2 | Jan.2023 | Jan.2023 | D | D | D |
| Consumer Price Index | Dec.2022 | Jan.2023 | M | M | M |
| Revenue, Expenditure, Balance and Composition of Financing3—General Government4 | Q3: 2022 | Dec. 2022 | Q | Q | Q |
| Revenue, Expenditure, Balance and Composition of Financing3—Central Government5 | Dec.2022 | Jan.2023 | M | M | M |
| Stock of Central Government Debt | Dec.2022 | Jan.2023 | M | M | M |
| External Current Account Balance | Sep.2022 | Dec.2022 | M | M | M |
| Exports and Imports of Goods and Services | Sep.2022 | Dec.2022 | M | M | M |
| GDP/GNP | Q4:2022 | Jan.2023 | Q | Q | Q |
| Gross External Debt | Q3:2022 | Dec.2022 | Q | Q | Q |
Includes reserve assets pledged or otherwise encumbered as well as net derivative positions.
Both market-based and officially-determined, including discount rates, money market rates, and rates on treasury bills, notes and bonds.
Foreign, domestic bank, and domestic nonbank financing.
The general government consists of the central government (budgetary funds, extra budgetary funds, and social security funds), and state and local governments.
This information is provided on a budget-accounting basis (not on a national accounts basis).
Daily (D), weekly (W), monthly (M), quarterly (Q), annually (A), irregular (I), and not available (NA)
Belgium: Table of Common Indicators Required for Surveillance
(As of January 31, 2023)
| Date of latest observation | Date received | Frequency of Data6 | Frequency of Reporting6 | Frequency of Publication6 | |
|---|---|---|---|---|---|
| Exchange Rates | Jan.2023 | Jan.2023 | D | D | D |
| International Reserve Assets and Reserve Liabilities of the Monetary Authorities1 | Dec.2022 | Jan.2023 | M | M | M |
| International Investment Position | Q3:2022 | Dec.2022 | Q | Q | Q |
| Reserve/Base Money | Dec.2022 | Jan.2023 | M | M | M |
| Broad Money | Dec.2022 | Jan.2023 | M | M | M |
| Central Bank Balance Sheet | Dec.2022 | Jan.2023 | M | M | M |
| Consolidated Balance Sheet of the Banking System | Dec.2022 | Jan.2023 | M | M | M |
| Interest Rates2 | Jan.2023 | Jan.2023 | D | D | D |
| Consumer Price Index | Dec.2022 | Jan.2023 | M | M | M |
| Revenue, Expenditure, Balance and Composition of Financing3—General Government4 | Q3: 2022 | Dec. 2022 | Q | Q | Q |
| Revenue, Expenditure, Balance and Composition of Financing3—Central Government5 | Dec.2022 | Jan.2023 | M | M | M |
| Stock of Central Government Debt | Dec.2022 | Jan.2023 | M | M | M |
| External Current Account Balance | Sep.2022 | Dec.2022 | M | M | M |
| Exports and Imports of Goods and Services | Sep.2022 | Dec.2022 | M | M | M |
| GDP/GNP | Q4:2022 | Jan.2023 | Q | Q | Q |
| Gross External Debt | Q3:2022 | Dec.2022 | Q | Q | Q |
Includes reserve assets pledged or otherwise encumbered as well as net derivative positions.
Both market-based and officially-determined, including discount rates, money market rates, and rates on treasury bills, notes and bonds.
Foreign, domestic bank, and domestic nonbank financing.
The general government consists of the central government (budgetary funds, extra budgetary funds, and social security funds), and state and local governments.
This information is provided on a budget-accounting basis (not on a national accounts basis).
Daily (D), weekly (W), monthly (M), quarterly (Q), annually (A), irregular (I), and not available (NA)