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Belgium Freight Transport Report Q1 2011
Business Monitor International, Nov 2010, Pages: 31
The Belgium Freight Transport Report provides industry professionals and strategists, corporate analysts, freight transportation associations, government departments and regulatory bodies with independent forecasts and competitive intelligence on Belgium's freight transportation industry.
The collapse of the five-party coalition government in April 2010 started a new period of potential instability in Belgium, with complex negotiations taking place across the linguistic and ideological dividing lines of Belgian society. The parliamentary elections on 13 June saw the separatist New Flemish Alliance emerge as the largest single grouping from the vote, although the French and Flemish Socialists together had more seats overall. Belgium's fractured political landscape means coalition negotiations are often a complex and lengthy process and were set to go on after the country assumes the EU's rotating presidency in July 2010. There are pressing fiscal problems and Belgium’s deficit is calculated at around 6% of GDP and unemployment is also high at over 8%. Like the rest of continual Europe, Belgium faces a period of labour unrest as unpopular austerity measures are brought in.
BMI forecasts a slow recovery from the 2009 recession, when the economy contracted by -3.1%. Our macroeconomic forecasts remain unchanged from our previous quarterly report but the downside risks have edged up. We expect GDP growth of 1.1% in 2010, accelerating gradually to 1.3% in 2011. Across our five-year forecast period to 2014 we expect average annual GDP growth of 1.5%.
Belgian airfreight volume fell very sharply in 2009, down by -21.9%. In 2010, BMI have revised down a very weak recovery to a continued contraction of –1%. We also expect a continued contraction of rail freight in 2010 of –7% after a sharp fall in 2009 of –13.5%. Road freight in 2009, saw only a modest contraction of cargo hauled by road fall by -6.2%. For this year we predict strong growth of 10% in road freight volumes.
At Belgium's major ports the picture is L-shaped, with a very big drop in cargo handling last year at most ports or no growth at the smaller ports and a modest recovery in 2010. At the country's largest port, Antwerp, we expect volumes to go up by 0.6% this year, after a -15.6% fall in 2009. Container volumes will fare only marginally better.
Belgium's foreign trade has not been volatile in recent years, rather the pattern has been for very slow growth in real terms. Total trade grew by 0.4% in 2009 and we forecast it expanding by the same amount in 2010. In fact, for the next five years imports and exports are projected to grow by an average rate of 0.4% per annum.
There are downside risks to our freight transport forecasts for Belgium. The most significant of these is that the negotiations to form a new coalition government drag on for a few more months, postponing urgent fiscal and economic policy decisions. This would almost certainly lower the country's growth prospects, with consequential knock-on effects for freight demand. Prolonged and active labour unrest disrupting airports, seaports and the rail network or another major threat.
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