Belgium remains a solid and resilient economy, but a recent report by Eight Advisory makes clear that strong foundations alone are no longer enough. The country’s challenge is to convert its assets into growth, innovation, and long-term resilience.
• Belgium ranks 14th globally, excelling in education (4th) and social cohesion (12th), but underperforming in economic dynamism (22nd) and sustainability (26), limiting its upward momentum.
• The so-called ‘Belgian paradox’ remains visible: while Belgium continues to produce strong educational and research outcomes – and has seen the emergence of several high-quality startups in recent years – this excellence does not yet translate consistently into large-scale innovation, sustained scale-ups, or broad-based economic growth. Structural factors such as labor-market rigidity, tax uncertainty, institutional complexity, and a limited pace of reform continue to constrain the ability of young firms to grow and compete internationally.
• Accelerating labor market and tax reforms, spending public money more wisely, strengthening the link between education and innovation, and speeding up the energy transition are key to keeping Belgium competitive in Europe and beyond.
Eight Advisory’s latest Competitiveness Report paints a nuanced picture of Belgium. Ranked 14th out of 58 countries, Belgium remains firmly positioned in Group B: ‘Highly Competitive’ economies. “This confirms the country’s solid fundamentals, but also highlights a persistent gap between potential and performance”, says Philippe Fimmers (Managing Partner Eight Advisory for the Benelux). “Belgium is doing many things right, yet struggles to convert its strengths into sustained economic dynamism and future-proof growth.”
Education stands out as a flagship strength. Ranking 4th globally, Belgium benefits from a strong educational system, high-quality universities, and a highly skilled workforce. This long-standing societal investment continues to underpin the country’s attractiveness and talent base.
Society, where Belgium ranks 12th, reinforces this positive picture. High levels of social cohesion, equality, life satisfaction, and public services contribute to political stability and quality of life; important factors for long-term competitiveness and investor confidence.
However, these strengths are not fully reflected in economic outcomes. Belgium ranks only 22nd in the ‘Economics’ pillar, signaling underperformance in growth, agility, digitalization, and foreign investment attraction. High public debt, a heavy and unstable tax burden, and limited labor market flexibility weigh on economic dynamism.
The Sustainability pillar is an even greater concern. At 26th, Belgium lags behind many European peers in energy transition, environmental performance, and green innovation, areas that are increasingly decisive for competitiveness, resilience, and capital allocation.
The Belgian paradox: education without economic payoff
One of the central themes of the report is the Belgian paradox: world-class education but lagging economic results. While Belgium has invested heavily in accessible and high-quality education, warning signs are emerging. PISA scores have gradually declined (from 16th to 18th place), raising concerns about whether today’s students are being adequately prepared as tomorrow’s innovators and entrepreneurs.
“On the economic side, the issue is not talent, but structural rigidities”, says Fimmers. “Labor market reforms remain incomplete, administrative burdens are high, and taxation – while not necessarily unfair – lacks predictability. Frequent changes and ‘temporary’ crisis contributions that become permanent undermine confidence and long-term planning for companies and investors.”
Structural headwinds holding Belgium back
The report identifies several structural obstacles:
• Institutional complexity and fragmented governance, which slow decision-making and complicate reforms.
• Despite strong performance in research and education – and growing entrepreneurial activity in recent years – an innovation gap persists, as only a limited share of this excellence converts into scale-ups, sustained commercial success, or global champions.
• Regional disparities, which contribute to uneven policy implementation and economic performance.
• Missed leverage of assets, as Belgium does not fully capitalize on its education system, infrastructure, and central European location.
Compared to its neighbors, Belgium sits in the middle of the pack. France scores lower overall, while the Netherlands outperforms Belgium in economics and sustainability thanks to lower public debt, stronger tax competitiveness, and faster digitalization.
Germany remains an economic powerhouse with greater fiscal capacity to invest. Smaller countries – often with fewer than 25 million inhabitants – tend to perform better because they can act more agilely, implement reforms faster, and maintain balanced excellence across all pillars.
Stability over seven years, but no breakthrough
Looking at the past seven years, Belgium’s position has been remarkably stable. It has avoided any sharp decline and remains a strong European economy. Yet this stability also reveals a lack of upward momentum. Persistent weaknesses in economic dynamism and sustainability have prevented Belgium from joining the top tier of global performers.
What should change: clear reform priorities
Eight Advisory’s recommendations are pragmatic and focused:
Accelerate labor market reform
Make work more attractive than inactivity, reduce dependency on government support, and increase flexibility without undermining social cohesion.
Restore tax competitiveness and stability
Fair taxation is not the issue, but predictability is. A stable, durable tax framework would significantly improve Belgium’s international attractiveness.
Reduce and refocus public spending
Belgium must spend less overall, but spend smarter, prioritizing education quality, infrastructure, energy security, and healthcare.
Turn education into innovation and growth
Reinforce educational ambition, reverse declining PISA trends, and strengthen links between universities, research centers, and industry; especially for start-ups and scale-ups.
Accelerate the energy transition
Leading countries such as Sweden, Switzerland, and Denmark show that clear renewable targets, modern energy grids, carbon pricing, and innovation-friendly policies attract green investment. Energy equity and affordability are key to maintaining public support and resilience.
Why this report matters now
In today’s geopolitical and economic context, competitiveness is inseparable from resilience. Energy independence, robust infrastructure, strong governance, and efficient public spending are no longer optional, they are strategic necessities. Countries that invest in local resources, innovation ecosystems, and sustainability are better equipped to withstand global shocks and attract long-term investment.
The role of Eight Advisory
Eight Advisory supports companies, private & public investors and public authorities in navigating these challenges through tailored, high-impact solutions. With deep technical expertise and an entrepreneurial mindset, its teams work across transactions, restructuring, transformation, and performance improvement helping clients turn strategic ambition into operational results.
A window of opportunity
Belgium is not in decline, but it risks standing still while others move ahead. By learning from best practices in countries like Switzerland and the Nordics – where balanced excellence across education, economics, society, and sustainability is the norm – Belgium can unlock its full potential.
“The foundations are strong”, concludes Philippe Fimmers. “The question now is whether Belgium will seize the moment to translate them into sustained competitiveness, innovation, and growth.”
