A business in Belgium can thrive due to its strong economy, central European position and a variety of populations. Because of its location, open economy, multilingual workers and first-rate infrastructure, many companies consider Belgium an attractive place to set up their businesses. Almost all of the country’s Gross Domestic Product comes from its services sector, manufacturing, exports and the high-tech industry. Belgium’s government backs the idea of free trade and invites foreign investments into the country. Still, finding out about the local regulations and laws in Belgium is not always easy. It helps to work with local people who have experience in the areas needed to expand a business.
The benefits and positives of conducting business in Belgium
They include the following:
Strategic location
Since Belgium is in the European Union, its members have access to the market of more than 500 million EU consumers.
Trading with other countries in Belgium is very quick. The process of conforming to export rules can be handled in only one hour. Because of this, Belgium takes the top spot in the World Bank’s Doing Business report for trading with other countries.
The Belgian market covers the French region of Wallonia to the south, the Dutch region of Flanders to the north and a small region populated by German speakers. The diversity in Belgium allows companies to evaluate their products before distributing them to other European countries.
Diversified economy
Belgium wants to enhance and increase free trade agreements so that it becomes easier to sell its products globally and the economy can grow.
The country is considered the 12th biggest supplier and the 14th biggest buyer of goods in the world. Seventy-five percent of the country’s GDP and three-quarters of its jobs are from the service industry. This area is rapidly growing in biotech, dedicating most of its efforts to research, new startups and medical trials.
Strong infrastructure
The nation’s transportation sector includes ports on the sea and inland, airports, railways and other options. Improvements to infrastructure have allowed the economy to develop and prosper. It is said that Belgium’s networks for trains and planes are highly important and popular for their industry and logistics. Because Belgium borders France, Germany, Luxembourg and the Netherlands, trading within the EU is made easier.
Brussels is a worldwide city
Because of its main role in governing Europe, Brussels is often called “Europe’s capital”. The headquarters of NATO and the EU are among the important institutions located there.
Besides politics and government, Brussels is home to a lot of international companies. Only Singapore receives more association meetings than Vancouver does.
Issues and elements that could pose a problem for businesses operating in Belgium
They include:
Brexit and Belgium are both examples of withdrawal
Because of its strong relationship with the United Kingdom, Belgium is highly exposed to Brexit. Trading between Belgium and the UK is the fourth largest of its kind.
It is possible that Brexit will cause a significant decrease in employment in Belgium, making unemployment in the country even worse.
Intellectual property
Only the parts or regions of Belgium where a business is registered enjoy protection provided by its intellectual property rights. Furthermore, companies have to get several patents in each European region where they operate instead of obtaining a single European patent.
High salaries
Other regions in the EU rank lower than Belgium when it comes to spending on salaries. Both the social security and income tax rates in the country are among the most expensive in the EU. The only country with higher social security contributions is France.
Still, the country saves money by requiring a lower income tax.
Paying taxes
The OECD Economic Survey points out that taxing labour incomes too heavily may lower Belgium’s growth rate and decrease employment. The total amount of taxes and social security contributions is 55.4 percent in the country. It is much higher than the OECD average for high-income members, which is 39.9 percent. About 44 percent of the 55.4 percent tax rate is set aside for labour tax and contributions.
All businesses in Belgium are expected to pay 11 taxes each year.
Building stronger momentum in Belgium
Operating your business in another nation, regardless of how conducive it may be, can be confusing. If a business is not aware of how local rules and practices evolve, it may experience delays in starting operations, increases in expenses, tax fines or trouble with civil or criminal lawsuits.
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