Belgium ranked 5th most attractive country for foreign investors

Il y a 4 years

Jean-Pierre Marcelle, CEO of the AWEX Foreign Investments Division, offers his interpretation of the 2013 Barometer of Belgian Attractiveness published on 6 June 2013 by Ernst & Young.

The number of foreign investments in Belgium identified by the consultancy company rose from 153 to 169 in 2012, up 10.5%. This increase means that Belgium now ranks above our Dutch neighbours, classed as the fifth most attractive investment country in Europe, our best placing since 2008.

Historically, we typically lag behind Europe’s major economies including the UK, Germany, France and Spain. This year’s total of 169 projects is higher than last year, although many of these projects create very few jobs.

The UK also maintained its historic leading position in 2012, attracting almost a fifth of all foreign investment projects in Europe. It won 697 projects, up 2.7% on 2011. Germany also comes out very well. With 624 foreign investment projects in 2012, it registered a rise of 4.5% compared with 2011 and more than double compared with 2007. The news is not as good for our neighbours in France and the Netherlands. France attracted 471 foreign investment projects, down 12.8 %, and the Netherlands recorded a fall in investments of 5.3%, with a total of 161 projects.

What does this barometer tell us?

1.A solid recovery in Wallonia; a modest revival in Flanders following the sharp downturn in 2011 and the record year of 2010.

Having experienced a sharp decline in 2010, Wallonia made a solid recovery in 2012. The number of foreign investments rose from 39 to 52. Wallonia recorded its best result in ten years (just short of its figure for 2009, when it achieved a total of 57 projects).

The province of Liège comes out top for attracting foreign investors, with its number of projects rising from 9 to 23. With 19 investments, Hainaut also achieves a good  score. However, a slight drop for Walloon Brabant, where the number of investments dropped from 11 in 2010 to 4 in 2012.

Last year, Flanders attracted 80 foreign investments, a slight increase on its 74 projects in 2011. However, Flanders is finding very difficult to replicate past successes. In 2010 for example, the Flemish region again attracted 108 foreign investments

This downturn is clearly evident in Flemish Brabant where investments fell from 21 to 14 projects. The province of Antwerp recorded a rise of 11 projects making a total of 36 in all; however this increase is not sufficient to compensate for the sharp decline in 2011, when the number of foreign investments fell from 55 to 25. The progress made by eastern Flanders (up from 11 to 16 investments) is encouraging.

With 37 investments in its region, the Brussels-Capital region remains stable in comparison with 2011. With foreign investments twice as high as in 2010, these have mostly been in the fields of sales & marketing. However, with an average of only 1 person per project, job creation in Brussels is insignificant.

2.The United States remains the leading source of investment

As has been the case for many years, the US tops the rankings of countries that invest in Belgium. In 2012, the number of investments from American companies rose slightly, up from 38 to 41 investments compared with 2011, ensuring a positive reaction to the worrying fall recorded in 2011 (down from 50 to 38). Furthermore, Belgium mainly attracts investments intra-European investments, especially from our direct neighbours. France stands out with a total of 21 investment projects in 2012. Increased interest from Germany is also worthy of special mention, with 16 investments compared with 11 in 2011. Belgium appears to some extent to benefit from the solidity of the German economy.

The Netherlands (11 projects) and UK (9 projects) also remain key investors in our country, even though investment from across the Channel is down.

The US and our European neighbours together represent 58% of all direct foreign investments in Belgium. With a reduction from 18 projects in 2011 to 13 in 2012, the proportion of investments from the BRIC countries (Brazil, Russia, India and China) has proved disappointing. By taking on 7 investments in Belgium in 2012, China is our main investor among the BRIC countries.

3. Job creation remains sluggish

Though driving job creation through new foreign investments has long been a problem, it reached an all-time low in 2012. The number of new jobs fell by as much as than 18%. With just 17 jobs created per project, current figures are 40% below the Belgian average for the past 10 years. This means that Belgium drops out of the top 15 on the job creation front.

The fact that our country appears totally out of step with the current European trend is worrying. Job creation through foreign investments in Europe has risen by an average of 8% to 170,434 jobs and the average number of new jobs per project also rose from 40 in 2011 to 45 in 2012. The average for Belgium is down by a full 60% compared with figures for Europe. This is our country’s worst result since the study began.

One promising sign, however, is that 63% of the investments made in Belgium are for ‘greenfield’ projects. With 107 greenfield projects out of a total of 169 direct foreign investments, new investment projects remain more important than expanding existing projects. And yet, most of these greenfield projects are not major sources of job creation. Projects in the fields of Sales & Marketing, business offices and representation agencies (for the most part in the Brussels region) account for almost 70% of investments and create very few jobs.

Did you know that…

  • In 2012, Belgium was ranked as the 5th most attractive European country for investment, notching up a total of 169 foreign investments last year.
  • This result means that Belgium improved on its 2011 performance (+11%), where it achieved 6th place in the rankings.
  • What is remarkable is that this this rise of one place can mainly be attributed to Wallonia, which has seen a significant rise in the number of investment projects (currently at 52 projects, the region accounts for 31% of investment in Belgium).
  • However, a slight shadow looms over the figures. Job creation remains a real problem in Belgium. With an average of  only 17 jobs created per investment project, this is the country’s worst ever score. Here again, Wallonia has fared better than the rest of the country with an average of 22 jobs per project.

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