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Country Risk Service Belgium 3rd Quarter

  • ID: 2192840
  • August 2015
  • Region: Belgium
  • 20 Pages
  • The Economist Intelligence Unit

The BBB rating is unchanged, but the score improves to 32, following the shift into surplus on the current account in 2014; a broadly stable fiscal deficit since 2013; and a return to price growth following mild deflation in the first quarter of 2015. A stubbornly high public debt load is still a risk, but low interest rates and quantitative easing in the euro zone will keep funding markets sanguine.

The BB rating is unchanged, with a score of 43. The Economist Intelligence Unit expects the recent depreciation of the euro against the US dollar to continue during 2015-16, in line with growing divergence between euro zone and US monetary policy. Euro zone growth has improved, notably in Germany, but tensions with Russia and political instability in Greece remain sources of risk. We forecast the medium-term risk of Greece leaving the euro zone at 60%.

After a sustained improvement in the sector's health since the 2008-09 global financial crisis, a 1-point improvement in the score in February took the rating up to A, where it remains. The Tier 1 capital adequacy ratio came to 15.3% at end-2014, up from 11.5% at end-2008, and non-performing loans fell again in 2014. Profitability has slowed since the crisis, but is well above the EU average.

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Country Risk Service Belgium 3rd Quarter

Risk assessment
Sovereign risk
Currency risk
Banking sector risk
Political risk
Economic structure risk

Definitions
Sovereign risk
Currency risk
Banking sector risk
Political risk
Economic structure risk
Overall country risk

Sovereign risk
Current assessment
Rating outlook

Central scenario for 2015-19: Political stability

Central scenario for 2015-19: Election watch

Central scenario for 2015-19: International relations

Central scenario for 2015-19: Policy trends

Central scenario for 2015-19: Fiscal policy

Central scenario for 2015-19: Monetary policy

Central scenario for 2015-19: Economic growth

Central scenario for 2015-19: Inflation

Central scenario for 2015-19: Exchange rates

Central scenario for 2015-19: External sector

Key risk indicators

Ratings summary

Quarterly indicators

International assumptions summary

Economic structure

Public finances

Exchange rates, interest rates and prices

Financial sector

Current account

Foreign payment and liquidity indicators

External trade

Note: Product cover images may vary from those shown
Note: Product cover images may vary from those shown

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