Planning Bureau forecasts greatest shrinking of the economy since WWII

Planning Bureau forecasts greatest shrinking of the economy since WWII According to the latest forecast issued by the Federal Planning Bureau the Belgian economy will contract by 10.8% this year. In April the Federal Planning Bureau and the National Bank of Belgium forecast that the economy would shrink by 8% in 2020. In its latest projection the Planning Bureau now warns of an economic shock the likes of which has not been seen since the end of the Second World War.

A partial recovery will take place during next year with growth of 8.2% forecast. “Our scenario projects a strong recovery during 2021 that will it is true only partially make good the shrinking of the economy during 2020”.

This year the number of jobs in the Belgian economy will reduce by 34,000. Next year 77,000 jobs will be lost. "Despite the implementation of well-measured protective measures, employment will not escape the consequences of the economic shock”.

In the footnote to its projections the Planning Bureau says that it is “extremely difficult” to make forecasts due to the unprecedented scale of the shrinking of the economy. For example, in it’s the Planning Bureau assumed that the restart of the economy will not be impacted by measures that might be taken in the event of a second wave of the virus.

Based on the Planning Bureau’s projections the Federal Budget Minister David Clarinval (Francophone liberal) expects the budget deficit this year to go up to between 40 and 45 billion euro.