"Cost of living rose 31%"

Fresh research from the Institute for Sustainable Development paints a somber picture of Belgium's economic prospects in 2012. The Institute predicts that spending power will fall further and that unemployment will rise.

Economist Philippe Defeyt has taken a look at what the economy has in store for us in 2012. Average spending power will only total 97% of what it totalled in 2009 when spending power peaked. A series of quick price rises with which the index couldn't keep step are being blamed. The index keeps public sector wages and benefits in line with inflation by triggering wage and benefit increases after inflation goes up by 2%. However, not all price increases are fully taken into account when the index is calculated.

Food rose 38%, rents 44% and energy 77% in the period between 2010 and 2012.

The Institute claims that the cost of living for the average consumer rose by 31% in only two years. For households on a low income the rise was 45%.

Unemployment too is expected to increase too in 2012.

Philippe Defeyt: "The number of jobless is expected to equal the highs we experienced during the middle of the noughties."

Unemployment is expected to peak at 13%.