Belgium is Europe's biggest borrower

1st February 2010, Comments 0 comments

This year the Belgian treasury will borrow a record amount of 89 billion euros in order to balance the country's state finances.

The figure makes Belgium the largest borrower on the continent of Europe.

In recent years the amount of money Belgium has been obliged to borrow on the money markets has continued to grow.

2010's figure is one billion up on last year, but ten billion up on three years ago.

Increased borrowing is partly due to the amount of state aid Belgium has provided to the main banks operating in the country.

Jean Deboutte of the Debt Agency says: "Belgium has had to make a sizeable effort to stabilise the country's financial institutions."

The entire operation cost the Belgian taxpayer some twenty billion euros. Some of the money has already been repaid.

The Belgian state had to borrow most of the cash first though.

Jean Deboutte: "In addition to the banking crisis Belgium also faced a deteriorating budgetary situation as a result of the global economic downturn. Now we're having to borrow more and we're not just refinancing the existing debt."

The Belgian Government is banking on recouping its lending to the country's main financial players. This should allow Belgium to reduce its state debt in the coming years.

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