Study: ‘Brussels well and solidly a supported role for the Flemish economy’
The Brussels Region plays a well-supported role for the Flemish economy. This is apparent from the recent study “Economic cohesion between the Flemish and Brussels Regions” by Statistics Flanders.
The report maps the relationship between the Flemish and Brussels economies by analyzing the available data, but also outlines the interrelationship between the two economies via the interregional input-output table (RIOT).
If we look at the added value and employment in final demand, in the Flemish Region exports (mainly goods) make up the bulk with 36% of gross value added and 32% of employment. Household consumption is the second most important item (30% and 28%), followed by government consumption (20% and 25% respectively) and investment (12% for both indicators).
The bulk of the gross added value and employment is generated in Flemish credits (84% to 85%). Only 10% of the added value and 8% of the employment value in Brussels coverage. Relatively speaking, the Brussels Region provides the most support for Flemish government consumption and the consumption of Non-Profit Institutions (NPISHs).
Paradox
In the Brussels Region, exports account for 42% of gross value added and 35% of employment. This is followed by household consumption (about 25%), government consumption (19% and 26% respectively) and investment (12% to 14%).
The Brussels Region itself also accounts for the bulk of gross value added (71%) and employment (65%). In both cases, the Flemish Region contributes approximately 20%. This is especially the case for collective government consumption, investment and household consumption.
The report points to a paradox: the Flemish share for the Brussels final demand is larger than the Brussels share for the Flemish final demand. But in absolute figures, more gross value added and employment in the Brussels Region is active to meet the Flemish final calculation: 2.3 times more for gross value and 1.8 times more for employment (and even more for household and government consumption).
This is because the Flemish final demand is much larger in absolute figures (approximately 5 times greater than the Brussels final demand). The Brussels Region therefore also plays a role for the Flemish economy in terms of final demand, the report concludes.