Long-term unemployment remains stubbornly high. The fiscal situation improved markedly over the past decade, though there is much more to be done. Despite this progress, both the debt ratio and the tax burden remain high. This projected increase in growth reflects three factors. First, macroeconomic policies are assumed to remain accommodative.
Monetary conditions are also likely to remain supportive of further expansion.
Second, the external situation is set to continue to improve, particularly in view of the anticipated pickup of activity in Germany and France. And, finally, consumption should continue to be bolstered by household confidence and employment gains. Executive Board Assessment Executive Directors commended the Belgian authorities for the marked improvement in their fiscal situation in recent years which had helped turn around the public debt dynamics. They welcomed the pickup in economic activity in the course of 1999, and noted that high household confidence, expanding export markets, and supportive monetary conditions should help ensure a continued economic recovery. Moreover, they observed that inflation would remain moderate in view of the existing economic slack and already negotiated wage settlements.