Belgium has requested more time from the European Commission (EC) to present its budget plan as coalition negotiations, following the June 9, 2024 federal elections, remain unresolved after 206 days.
The country, grappling with one of the highest debt levels in the EU, has been under pressure to address its deficits since the EC initiated an excessive deficit procedure in June 2024.
After failing to meet its September 2024 request for a postponement, Belgium now seeks another extension without offering a firm timeline. The government expressed hope that a budget plan would emerge “in the near future” once a new federal coalition is in place.
An EC spokesperson confirmed the request, saying the letter to Maarten Verwey, Director-General for Economic and Financial Affairs, outlined no precise submission date. The EC is currently reviewing the request.
Belgium’s financial challenges are growing, with the deficit projected to rise from 4.6% of GDP in 2024 to 5.3% in 2026—far exceeding the EU’s 3% target. In November, the EC urged Belgium to swiftly form a government and implement a stricter four-year fiscal adjustment plan, requiring a yearly reduction of 0.72% of GDP from 2025 to 2028. If Belgium shows progress, the EC might reconsider a more lenient seven-year adjustment path.
The EC has given Belgium until April 2025 to comply with its excessive deficit procedure (EDP) recommendations. By then, the EC and the Council will evaluate the country’s corrective measures.
In the absence of a new federal budget, Belgium’s caretaker government approved an emergency measure dividing the previous budget into 12 equal, indexed parts. This stopgap remains until a new government presents its fiscal plan.
Currently, Belgium faces a €1.5 billion budget deficit, which could climb to €2.46 billion under unchanged policies—double the pre-election estimate. Debt interest costs are also set to surge, rising from €395.9 million in 2025 to €632.7 million by 2029.
Despite the dire financial situation, recent signs of progress in coalition talks have sparked optimism. Negotiators are now hopeful a government might be formed by the end of January, offering a potential path forward for Belgium’s beleaguered fiscal policy.
