Industrial & Innovation PolicyIndustrial & Innovation Policy

BELGIUMBELGIUM

BelgiumBelgium

AgendaAgenda

Introduction

Political System

Economic Profile

Industrial policies

1. Introduction1. Introduction

Belgium in Europe

IntroductionIntroduction Situated in the centre of Western Europe

Very small: ca. 32.500 km²

Population: ca. 10.000.000

Capital: Brussels

Neighbours: The Netherlands, Germany, France, Luxembourg & UK

2. Political system2. Political system 1830: independence: unitary state BUT: language border!

=> Flanders / Wallonia / Oostkantons

5 state reforms – 3 Communities – 3 Regions

Communities & RegionsCommunities & Regions

A structure on 3 levelsA structure on 3 levelsFederal state + 3 Regions

+ 3 Communities

10 Provinces

589 Communes

CompetencesCompetences Federal state:Federal state:

– Everything that affects the interests of all belgians: foreign affairs, national defence, justice, finance,…

– Responsabilities vis-à-vis the EU and NATO

Communities:Communities:– Matters relating to the people: language, culture,

education,…

Regions:Regions:– Territorial matters: town planning, employment,

environment,…

– Foreign trade!!

Problems!!!

3. Economical profile3. Economical profilea) Geographical situation

b) General Economics

c) International cooperation

d) Economic problems

a) Geographical locationa) Geographical location Lack of mountains + border to North Sea

In the centre of the «industrial square»: Ruhr -- Randstad Holland -- Nord-Pas de Calais -- Lorraine-Saarland

in the centre of European ”megalopolis” , a major urban and economic corridor (Liverpool – Genua)

b) General economicsb) General economics

- real economic grotwh 2003: 1,0%

- inflation 2003: 1,3%

- GDP per capita: > 13% => relative wealth

- revenue per worker: 62.560 € (20% higher than EU average)

GDP in BelgiumGDP in Belgium

% of GDP

1%27%

58%

14%

agriculture

industry

privat services

public services

Import & ExportImport & Export

50% of export: neighbours25% of export: other EU members

Foreign investment!Ups and downs of economy –--

fluctuations of our neigbours

Belgium EU average

Export (% of GDP) 76,5 % 32,2 %

Import (% of GDP) 72,9 % 31,0 %

Import & ExportImport & Export 40% of export: 3 large groups

– Transport equipment– Machinery & appliances– Chemical & pharmaceutical products

Other 60%: large variety– Diamonds, carpets, comic books & childrens books,

linen, flowers (azalea & begonia), beer, chocolate,…

c) International cooperationc) International cooperation

prosperity = dependent on external trade => active part in intern. cooperation

BLEU Benelux

(+ Benelux Trademark Office)

One of the 6 founder countries of ECSC, EEC & Eurotam

pro european unification!

d) Economical problemsd) Economical problems

UnemployementUnemployement– 14 % of active population– High wage cost, high labour cost,

structural problems of Labour market– 200.000 new jobs <-> - 4.000 Ford

AAdministrative burdendministrative burden– Costs for administrative tasks: 3,4% of GDP – Lack of entrepreneurship!– ”state secretary of

administrative simplification” Government deficitGovernment deficit Welfare stateWelfare state

d) Economical problemsd) Economical problems

Administrative burdenAdministrative burden– Costs for administrative tasks: 3,4% of the GDP

(around 9 billion €)– Lack of entrepreneurship!– ”state secretary of administrative simplification”

Welfare stateWelfare state Ageing populiton => not engough money to pay

pensions ”Early retirement” at 55 (even 50)

Government deficitGovernment deficit Extreme until 1993 Draconian rehabilitation plans government debt/GDP ratio: 110.6%

4. Industrial and innovation policies 4. Industrial and innovation policies a) Belgian industry in general

b) Regional policy- Kortrijk-region

--- Flanders Language Valley

- Euregio Maas-Rhine- Flemish Diamond

Belgian industry in generalBelgian industry in general

Industrial sector: Industrial sector: 1/4e of all jobs 30% of added value

Major regional contrastsMajor regional contrasts– North: industrialised

Antwerp: chemical sectors Ghent, Zeebrugge, Brussels Central Flanders, Kortrijk-region, North-east

– South: not industrialised at all (anymore)

Belgian industry in generalBelgian industry in general

De-industrialisation & TeriarisationDe-industrialisation & Teriarisation– structure of industrial activity has changed a lot

– De-industrialisation since 50s: 1957-1992: all 120 coalmines have been shut down

(in Flanders) Production of steel (Wallonia) almost entirely stopped

– decline in jobs compensated by development in tertiary sector

b) Regional policyb) Regional policy

Complex structure + different cultures => no single industrial policy

Stimulation of regional development within different Communities & Regions– Wallonia: after decline of steel production: ??– Flanders: certain regions developed

70s – 80s: Euregio Maas-Rhine Early 90s: Kortrijk-region Late 90s: Flemish Diamond

Kortrijk-region –Kortrijk-region –Flanders Language ValleyFlanders Language Valley

Light industries, SMEs, local management Part: ”Flanders Language Valley” (speech tech)

Cluster of localised technological change After Sillicon Valley-model: strong pilote firm,

venture capital, education, informal networking L&H research lab: a common source of codified

knowledge Fast entrepreneurial reaction => developing broad

range of applications Favourable communication conditions innovative

linkages between SMEs

Kortrijk-region –Kortrijk-region –Flanders Language ValleyFlanders Language Valley

Companies: mutual advantage: – learn form each other– Using common pools of resources in proximity

E.g. employees in ”collective pools of labour” created by several education and training programmes

But: owners of L&H: FRAUDE !– Big scandal– Technology sold to Americans– FLV collapsed

Euregio Maas-RhineEuregio Maas-Rhine

Euregio Maas - RhineEuregio Maas - Rhine Norhteast of Flanders, near Holland & Germany,

near Maas and Rhine rivers

Lagging region without industries

70s: development started, because in “New” Europe cross-border cooperation at local and regional level was becoming more important

Agreement with Holland & Germany

Large foreign companies ( <-> SMEs in FLV)

Benefited from large amount of labour force

Flemish DiamondFlemish Diamond Region in centre of Flanders,

Antwerp – Ghent – Brussels – Leuven Urban network on international level Industrial economy => knowledge

economy Knowledge = critical succes factor for

the future Well-functioning urban network, modern

infrastructure to transport goods and person are necessary

Growth of Flanders depend on development of this diamond

--Wim Dooms -- 29-10-2003--