Belgium’s recovery and resilience plan

RRF FUNDED PROJECTS IN BELGIUM

WHAT’S IN THE PLAN?

The reforms and investments in Belgium’s plan are helping it become more sustainable, resilient and better prepared for the challenges and opportunities of the green and digital transition.  Following Council approval of Belgium’s plan on 13 July 2021, Belgium’s recovery and resilience plan was updated on 8 December 2023 also to introduce a REPowerEU chapter. 

• 119 investment streams and 40 reforms
• 51% of the plan will support climate objectives 
• 27% of the plan will foster the digital transition.    

The transformative impact of Belgium’s plan is the result of a strong combination of reforms and investments which address the country’s specific challenges. 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 measures 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.     

Belgium’s plan now includes a REPowerEU chapter, comprising 4 reforms and 25 investments to reduce its reliance on fossil fuels, in line with one of the REPowerEU Plan's objectives.

To finance this increased ambition, Belgium has asked for a share of its Brexit Adjustment Reserve to be transferred to the plan, amounting to €229 million. These funds would be added to Belgium’s REPowerEU grant of €282 million. Belgium has also requested €264 million of loans under the RRF, most of which is used to finance its REPowerEU chapter.

Key measures for REPowerEU

Among other important measures, the REPowerEU chapter includes:

• The reform of the appeal procedures of the Council of State, which aims at accelerating the deployment of renewable energy in Belgium by removing administrative bottlenecks linked to investments in renewable energy.
• A call for projects for the decarbonisation of industry, which foresees financial incentives for investments in the energy transition of industries in the Walloon region and in the development of new industries for green technologies.
• Subsidies that will be available to companies in Flanders investing in R&D activities related to the production of innovative technologies in the field of solar energy, as well as to companies investing in the electrification of port infrastructure.
• An additional investment in charging infrastructure for buses in the Brussels-Capital region, which lead to reduced emissions from urban public transport.

Belgium’s 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.
  • €1.2 billion investments 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.
  • An important reform to promote electric road transport by limiting preferential tax treatment of company cars to zero-emission vehicles by 2026.
• The plan also supports the decarbonisation of the energy sector and industry, for example by promoting the use of hydrogen as an energy source and research into new innovative technologies, with an investment of €677 million and accompanying reforms that should contribute to making it happen.
• On biodiversity and climate change adaptation €289 million will be invested in:
  • Reconnecting ecosystems, enhancing protected natural areas, forests and wetlands; and
  • Structural measures to sustainably manage water availability thereby increasing climate change resilience.

The modified plan, including the REPowerEU chapter, has further strengthened the focus of the plan on the green transition, devoting 51% of the available funds to measures that support climate objectives (up from 50% in the original plan).

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. 
• The plan will invest:
  • €395 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.
  • €448 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.

The modified plan has not diminished the focus of the plan on the digital transition, still devoting 27% of the available funds to measures that support digital objectives.

Key macro-economic challenges for the Belgian economy include a low employment rate - in particular for people with a low educational attainment, 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 for 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 system is expected to improve the sustainability and adequacy of pensions.
  • Belgium will notably invest €475 million in reskilling and upskilling measures and over €300 million will boost Belgium’s innovation capacity by financing research and innovation infrastructure and programmes.
  • Furthermore, €124 million will finance projects on the promotion of recycling and reuse, eco-design projects and will support innovation in resource-handling and waste processing.

Annual events facilitate the exchange of views on the state of implementation of the Recovery and resilience plans, while ensuring close cooperation between all stakeholders and providing a platform to discuss interlinks between the Plans and other Union programmes. 

More information on Annual events held in Belgium can be found here

Belgium’s 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)

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