Respecting the deadline of 30 April, Belgium shared its National Plan for Recovery and Resilience with the European Commission. This Belgian national recovery plan fits into the EU’s COVID-19 Recovery and Resilience Facility, which makes €672.5 billion in loans and grants available to support reforms and investments undertaken by Member States. Belgium is entitled to claim around €6 billion in support if the European Commission approves the list of proposed Belgian projects. The Commission expects, for example, that the national recovery plans are in line with the EU’s objectives, i.e. 37% of the investments will be spent on sustainability and 20% on digital transition. However, the Belgian plan is even more ambitious as 57% (€3.4 billion) will be allocated to sustainable projects and 31% to digital transition (€1.85 billion).
The document of almost 700 pages includes 87 investment projects and 34 reform projects, broadly revolving around six axes: sustainability, digital transition, mobility, inclusivity, productivity and public finances. This blog post provides a closer look at the first three axes.
Three axes of the Belgian national recovery plan: sustainability, digital transition, mobility
The green transition
The sustainability axis is divided in three separate components: renovation of buildings, emerging energy technologies and climate and environment. This division already gives an idea of the Belgian priorities relating to sustainability.
Belgium wants to invest more than €1 billion in the renovation and sustainability of public buildings and social housing, which is almost one third of the total investment in sustainability. This is necessary as much of the Belgian building stock is old and among the least efficient in Europe. More than 80% of the building stock is energy inefficient (EPC class C and below), and 50% of the building stock is the worst performing (EPC class E and below). To tackle this challenge the plan indicates that all government levels want to invest in the renovation of public buildings, such as government buildings and schools. This includes investments in insulation measures, joinery and glazing and Green Heat (generation, storage and distribution). Next to that the plan stresses that more efforts must be made concerning the energy renovation of social rental properties. In that context, the Flemish government decided, for example, that by 2050 at the latest existing social rental properties must achieve an equivalent or comparable energy performance level as newly-built homes.
Investments in emerging energy technologies must support the energy transition and system integration to further reduce CO2 emissions. Next to a reform of the fossil fuels tax and investments in the industrial value chain for the hydrogen economy, this includes €450 million for an offshore energy island in the North Sea that should be ready by 2025. The advantages of the energy island are threefold according to the plan. Firstly, it will enable power consumers to make use of a greener energy mix. Secondly, the hub will generate economic activity in both the short and long term. Finally, the hub will position Belgium at the center of the debate on energy hubs in the North Sea. This is interesting for private investment and can result in further interconnectivity, which is important as Belgium has limited space at sea.
The last component of the sustainability axis of the Belgian national recovery plan is climate and environment, which aims to clarify the ambition to conservate and redevelop biodiversity though the sustainable use and restoration of forests, wetlands meandering rivers and grasslands. Wallonia for example wants to establish two new national parks by 2026. This would not only protect the biodiversity but also increases the quality of life and regional economic development, in particular through jobs generated in tourism. With the Blue Deal, Flanders on the other hand wants to anticipate on their structurally low water availability. Therefore, they will invest in large-scale restoration and construction of wetland nature, robust green-blue interconnection in the built environment and in more open space. In addition, €6 million is earmarked for research projects aimed at sustainable water use in the agricultural sector
The digital transition
The digital transition of Belgium will mainly focus on investments in cybersecurity (€80 million), new technologies, including 5G (€100 million), and about €580 million will go to the digitization of the public services.
Based on structural investments and reform projects, the objective of the cybersecurity component is to fight against cyberthreats through projects that strengthen Belgian resilience and capacity to face new cybercrime phenomena. These investments will mainly be carried out by the federal government and include a new national strategy targeting all actors: the general population, private organizations and vital organizations like the Belgian defense. This plan must ensure that Belgium is one of the least vulnerable countries in Europe in terms of cybersecurity by 2025.
Furthermore, 75% of the digital budget will go to investments in digital technologies to make the actions of the public administration more efficient, both in its internal processes and in its interaction with citizens and businesses. For example, €85 million will be earmarked for the digitization of the Justice Department. Next to these investments, this component also aims to increase the simplification of administrative procedures for both citizens and businesses by adapting existing e-government applications to existing standards and developing new applications where necessary.
Lastly, the plan indicates the Belgian ambitions to improve the connectivity of the national territory through the development of fiber-optic networks at very high speed, as well as developing 5G corridors that enable universal and affordable access to connectivity in all urban and rural areas. This component also aims to capitalize on the development of new technologies, such as artificial intelligence (AI), by ensuring that these technologies have a positive societal impact.
Further to the ‘mandatory’ investments in sustainability and digital transition, the Belgian governments decided to also make mobility one of the spearheads of the Belgian national recovery plan. About €1.3 billion will be used for the (re)construction of new pedestrian and cycle paths, the modal shift of transport and greening of vehicles.
All regional governments will try to improve the quality of the bicycle infrastructure. For example, the Schuman square in the European district in Brussels will undergo a significant transformation and will be finalized by 2025. In combination with public transport and car-sharing solutions, investments in bicycle infrastructure are expected to further reduce car ownership and use.
To achieve the desired modal shift in transport, the Belgian governments want to improve public transport services by investing in new or more efficient bus, tram and metro infrastructure and by improving their services. This includes the expansion of the metro and tram network in Charleroi and Liège. At the same time, tax reforms and digital tools, like applications to further develop the Mobility-as-a-Service (MaaS) ecosystem in Brussels will increase the demand for sustainable transport. As far as freight transport is concerned, major works will be funded to support the modal shift from road to water and rail. For example, by raising the bridges over the Albert Canal in Liège it would be possible to allow ships with four layers of containers to sail between Antwerp and Liège.
Finally, greening of vehicles will play an important role in the future of Belgian mobility. To achieve this ambition, the different governments will accelerate the electrification of road transport by increasing the use of electric buses for public transport, accelerating the development of charging infrastructure and establishing a new framework for commercial vehicles. The plan indicates that 80,000 public and private charging points for electric vehicles will be installed by 2026.
Conclusions from the Belgian National Recovery Plan
The National Plan for Recovery and Resilience is a combination of very diverse projects proposed by all government levels. The 87 investment and 34 reform projects are ambitious and they all will play an important role in the economic reconstruction of Belgium in the coming five years. With the financial injection of €5.9 billion from the European Recovery and Resilience Facility, if the European Commission approves the proposed projects, Belgium also wants to outpace the investment backlog compared to other Member States that has emerged since 2000. Therefore, the different governments will also use their own resources to achieve the objectives mentioned in the plan. In addition, as Belgium has one of the most open economies in the world, we can expect that it will also profit from the recovery plans of other Member States.
Dr2 Consultants is at your disposal to assess the National Plan for Recovery and Resilience and identify the impact and opportunities for your business and support you in the outreach towards Belgian stakeholders. Learn more about our Belgian Public Affairs services here.
List of Annexes
- Annex 1: Timeline of proposed sustainability projects
- Annex 2: Timeline of proposed digital projects
- Annex 3: Timeline of proposed mobility projects