Industry in Belgium: past developments and challenges for the future
B. Robert and
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B. Robert: National Bank of Belgium, Research Department
L. Dresse: National Bank of Belgium, Research Department
Economic Review, 2005, issue iii, 7-44
The article constitutes the synthesis of a broad study on industry in Belgium, conducted by the NBB, at the request of social partners. Some contributions were also made by the Federal Planning Bureau. In the past decades, industry has been submitted to two global trends. Firstly, deindustrialisation took the form of nominal activity and employment transfers between branches, i.e. from industry to services, while at the same time real industrial value added kept growing at a similar rate as the total economy, due to large productivity gains. Secondly, and partly linked to what precedes, economic globalisation was generalised thanks to liberalisation and technological progress, which has thoroughly modified the environment in which companies operate by opening up new markets and allowing an increased division of the production process in search of efficiency. Recently, these long-known trends seem to have further accelerated due to the emergence of rapidly growing economies, which are either closely linked to European countries (ten new member states) or are large-scale economies (China). More than ever, the industry’s future lies in safeguarding competitiveness and looking for new competitive edges, a challenge which it shares with the total economy. First of all, it requires a close monitoring of cost developments, especially as competition mainly takes place with neighbouring, thus similar, economies. In this respect, wages are an important, but only one component of production costs. Nevertheless, the competitiveness of an economy increasingly results from a large group of non-cost elements, which together determine its innovation capacity. Among these, we mainly stress the importance of continuous private and public investments, which are necessary to preserve and enhance the capital stock, of a well-educated and continuously trained labour force, of sufficient and well-oriented R&D efforts and of adequate and diversified sources of financing. Broadly speaking, innovation and economic dynamism require an integrated and extended approach, bringing together enterprises, research centres, universities and public authorities, in order for them to agree on a common view and maximise the spillover effects. Industry will still have an important role to play in meeting this objective.
Keywords: industry; deindustrialisation; globalisation; competitiveness; innovation (search for similar items in EconPapers)
JEL-codes: L6 (search for similar items in EconPapers)
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Persistent link: https://EconPapers.repec.org/RePEc:nbb:ecrart:y:2005:m:september:i:iii:p:7-44
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