Belgium’s recovery and resilience plan

Following an unprecedented crisis due to the pandemic, Belgium’s recovery and resilience plan responds to the urgent need of fostering a strong recoveryand making Belgium future-ready. The reforms and investments in the plan will help Belgium become more sustainable, resilient and better prepared for the challenges and opportunities of the green and digital transitions. To this end, the plan consists of 105 investments and 35 reforms. They will be supported by €5.9 billion in grants. 50% of the plan will support climate objectives and 27% of the plan will support the digital transition.

The transformative impact of Belgium’s plan is the result of a strong combination of reforms and investments which address the specific challenges for Belgium. The reforms address bottlenecks to lasting and sustainable growth, while investments are targeted to accelerate the transition towards a more sustainable, low-carbon and climate-resilient economy, to maximise the benefits of the digital transformation and to ensure social cohesion. The plan also intends to improve connectivity within the country, boost labour market performance, innovation capacity of the economy and make public spending more efficient and sustainable. All reforms and investments have to be implemented within a tight time-frame, as the Regulation on the Recovery and Resilience Facility foresees they have to be completed by August 2026.

The plan will foster economic growth and create jobs. It will lift Belgium’s gross domestic product by 0.9% by 2026. This boost to the economy will bring up to 16,000 citizens into jobs. Belgium will benefit significantly from the recovery and resilience plans of other Member States, for instance through exports to these Member States. These spill-over effects account for 0.5 percentage points of gross domestic product in 2026. This does not include the positive impact of structural reforms, which can be substantial. This demonstrates the added value of joint and coordinated action at the European level.

+ 0.5-0.9%

Impact of NextGenerationEU on Belgium's gross domestic product by 2026

+ 16,000

Jobs by 2026

0.5%

Gross domestic product benefits thanks to other Member States’ recovery and resilience plans in 2026

When designing the plan, Belgian authorities consulted national and regional social partners and stakeholders, while pursuing a close dialogue with the Commission ahead of the formal submission of the plan on 30 April 2021. On 23 June 2021, the Commission gave its green light to the plan. On this occasion, President von der Leyen symbolically transmitted the Commission’s assessment to Prime Minister De Croo during a visit in Brussels. The plan was in turn adopted by the Council on 13 July opening the door to its implementation and financing.

Green transition

Challenges for the green transition include important renovation needs of the building stock to increase its energy efficiency, making mobility and the transport sector more sustainable, and increasing the share of renewables in the energy mix. Finally, biodiversity, land use and water bodies are under pressure.

Key measures for the green transition

The plan supports the green transition through investments of over €1 billion in the energy-efficient renovation of buildings, including social housing. Furthermore, €1.3 billion will be invested in sustainable mobility, notably by improving railway infrastructure, financing green public buses, deploying electric charging stations, developing urban public transport and creating or refurbishing cycling pathways. In addition, an important reform promotes electric road transport by limiting preferential tax treatment of company cars to zero-emission vehicles by 2026. The plan supports the decarbonisation of the energy sector by promoting the use of hydrogen as an energy source,with an investment of €540 million and an accompanying reform that should contribute to making it happen. On biodiversity and climate change adaptation €400 million will be invested for reconnecting ecosystems, enhancing protected natural areas, forests and wetlands and for structural measures to sustainably manage water availability thereby increasing climate change resilience.

Example project: Electric charging stations

Belgium’s recovery and resilience plan supports the electrification of public and private transport, by accelerating the deployment of 78.660 additional electric charging stations by 2026 throughout the country. Investments amount to €61.5 million and are complemented by a coherent package of reforms boosting the e-mobility in the three Regions, including tax incentives and concessions tenders for the installation of private and semi-public charging stations and an increase of the mobility budget scheme. These measures will contribute to overshoot the national target of funding at least 37 566 public charging stations by 2025.

Digital transition

Digital challenges for the Belgian economy include addressing a lack of digital skills, strengthening fibre and 5G readiness and the digital transformation of public services.

Key measures for the digital transition

Belgium’s recovery and resilience plan supports the digital transition with investments in the digitalisation of the public administration, in skills and digital inclusion, in cyber security and in connectivity. It will invest €480 million in education, for a more inclusive and future-proof education system across communities with digital and STEM (Science, Technology, Engineering and Math) skills of pupils and students and access to digital tools and technology. Furthermore, the plan will invest €585 million in the digital transformation of the public administration, justice system and health care system to improve access for citizens and businesses, and a set of reforms that will contribute to the deployment of 5G and the deployment of ultra-fast connectivity infrastructure, such as fibre.

Example project: Digitalisation in education

In the Flemish community, a digital device will be provided to all school students, effective learning tools and training will be provided to teachers to improve their digital skills, and schools will be supported in adapting their curricula to the digital transition by setting up a central knowledge and advisory centre. In the French- and German-speaking communities the plan will equip schools and higher education institutions with modern digital equipment and will train students and teachers with dedicated digital skills tools and methods.

Economic and social resilience

Key macro-economic challenges for the Belgian economy include a low employment rate - in particular for youth, elderly and people with a migrant background -, skills mismatches, low productivity growth and a business environment not sufficiently fostering entrepreneurship, as well as low public investments in particular for the digital and green transitions in a context of high public debt. These challenges weigh on potential growth and employment.

Key measures in reinforcing economic and social resilience

The plan reinforces economic and social resilience with measures fostering effective and inclusive education systems, skills acquisition in line with current and future labour market needs, including the green and digital transition, and the participation of vulnerable groups (low-skilled, women, people with a migrant background, people with disabilities) to the labour market.
The plan includes measures to make public spending more efficient and sustainable. Spending reviews will contribute to improve the quality and efficiency of Belgium’s public spending, allowing to reprioritise it towards more growth and environmentally friendly expenditures. A reform of the pension regime is expected to improve the sustainability and adequacy of pensions.
Belgium will notably invest €450million in reskilling and upskilling measures and €400 million will boost Belgium’s innovation capacity by financing research and innovation infrastructure and programmes. Furthermore, €198 million will finance projects on the promotion of recycling and reuse, eco-design projects and will support innovation in resource-handling and waste processing.

Example project: more individualised support and training to job seekers

In Wallonia a reform will improve the efficiency of activation of jobseekers, notably taking advantage of digital tools and strengthening support to those most in need. In Flanders, the online training offer will be strengthened, and all temporary unemployed due to the crisis will be offered a training. In Brussels, the plan will support recently laid off workers to find a job in a different sectors and provide coaching and training to jobseekers, notably towards jobs in shortage.

The plan is consistent with relevant country-specific challenges and priorities identified in the European Semester, the annual cycle of coordination and surveillance of the EU’s economic policies. For a detailed explanation of the European Semester see the following link: The European Semester explained | European Commission (europa.eu)