Brexit – blessing for Belgium?

Brexit is not just a distant reality. There is a lot at stake, especially for Belgium. Due to the close trade relationship between our country and the UK, the Belgian economy and the Belgian citizens are much more vulnerable to the consequences of Brexit than their counterparts in many other European countries.

The actual effect on the Belgian economy will depend to a large extent on two factors. First, there is the form Brexit will take. Hard or soft? With or without a transitional agreement? Or will there be trade barriers? … The influence Belgian politicians can have on those decisions, cannot go beyond the European confines. However, they can do something about the second factor: how will Belgium prepare itself for the imminent separation? What to do in order to stay on the safe side?

This will not be an easy task. Belgian imports and exports may well be affected, but some of the current economic activities are also endangered. Several financial institutions are already reconsidering their presence in Belgium in the wake of the Brexit.

Brexit as a catalyst

Unfortunately, there are several elements which make Belgium a less attractive location: a pay gap as compared to our neighbouring countries, a high corporate tax level, huge traffic jams, a tax system which has turned into a labyrinth Knossos would have been proud of, and on top of all this, sky-high bank levies.

Eventually, Belgium may have to pay a high price, but this is not something which is inevitable. Brexit could be a catalyst which makes it possible to put an end to those structural weaknesses. It would be nice if we could look back on the Brexit as the crisis Belgium took as an opportunity for boosting its attractiveness and competitiveness.

Investing in mobility, a simplified tax system, stable regulations, better digital connectivity in Brussels are just a few examples of measures which may be beneficial for the Belgian economy.

Belgium’s trump cards

The Belgian authorities should be quick to react by coming up with a visible, coherent and coordinated Brexit plan.

Here are some examples of the assets Belgium can rely upon when it comes to attracting new activities: its being situated at the heart of Europe, its role of capital of the EU, its expertise in the field of market infrastructure and payments, ample office buildings and residential accommodation, a high standard of living as well as an ambitious and steadily growing fintech ecosystem. Moreover, many countries envy the presence in Brussels of international institutions such as Euroclear, SWIFT and BNY Mellon. We have every right to be proud of those precious assets.

A clever plan in combination with decisiveness and open communication would allow Belgium to turn Brexit into its own success story. Let us join our efforts and seize this opportunity.

Yannick Adriaenssens, Senior Officer Economic Affairs & Communication @Febelfin