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by George Ugueux
Recent indications from the IMF International could give the impression that Belgium will follow the example of Greece. A report published IMF teams on December 13 could not be clearer. "Controlling government spending is urgently needed." Fund and encourage the authorities to establish macro-economic priorities, mitigate risks in the financial sector and carry out "reforms to stimulate growth and job creation."
There is also a specific concern: KBC, one of three major Belgian banks bought an Irish bank is in trouble, and it is impossible to have accurate information about this risk. The Belgian banking system is in relative terms one of the most exposed on Ireland. Belgian banks have 29 billion dollars of loans to Irish banks. This represents 5% of GNP. Only UK banks have a similar level of debt.
The macroeconomic situation is precarious indeed, the debt represents approximately 100% of GNP. Furthermore the budget deficit of 6% is beyond the 3% allowed by the Maastricht criteria. It stretched without being fatal. However, this debt is mainly held by banks and investors from Belgium.
Former Chief Economist IMF's Simon Johnson, summarizes the situation in The New York Times on November 28. "The budgetary situation in Belgium is not brilliant, political stability is far from assured and social fissures will not be facilitated not austerity measures."
The situation is alarming and requires immediate attention and austerity measures which Belgium could not be found in the camp of the Eurozone countries in difficulties. It is building a political consensus in Belgium who would lead the country to follow the German example and be in the mainstream country economically sound that will take the course in a flurry of public finances that gradually takes over Europe.
Unfortunately this is not what happens: contrary to the facts, Bart De Wever who sees himself as the Prime Minister must for the next Government presented to a German magazine in Belgium as "the sick member of Europe. " Besides being wrong is the very type of irresponsibility that should disqualify any politician ever has access to government functions. If it were the Government, he should probably resign.
Instead of putting in place a Federal Government which is responsible for managing the deterioration of public finances, Mr De Wever Community negotiations dragged so incomprehensible. European Presidency of Belgium (in case you do not know, the government "out" holds the rotating presidency of the EU) is without a government elected in June The discussion of electoral districts Hal Vilvoorde blocks the institutional dialogue.
Moreover, both communities are trying to weaken even further the international standing of Belgium on the international capital markets by imagining increased budgetary allocations for communities.
Belgium is not on the brink. Fewer than one in ten Belgian wants the division. Its economy continues to grow so remarkable particularly in foreign markets.
But do not rule out that the Belgian politicians, who do not even imagine a Belgium Bart De Wever and without the VER-push the country into the abyss. The greatest threat to the country is in this linguistic-nationalist obsession. In doing so, politicians are disconnected from the people claiming an emergency, in various parts of the country, a government agreement.
Meanwhile, Standard & Poor's announced that Belgium's rating could be lowered if the political crisis is not resolved quickly. Faced with this threat, some Flemish newspapers want a specific rating for Flanders. They assume, absurdly, that it would be better than that of Belgium.
Belgians, including myself, have been warned ...
http://finance.blog.lemonde.fr/2010/12/20/la belgium-it-is-the-edge-of-precipice /
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