Belgium Consul General Speaks on Ukraine, Trade & Economics

Belgium has begun partnerships with Oman and Saudi Arabia in order to promote trade relations. Princess Astrid, representative of King Phillip, recently traveled to Oman to promote the Port of Duqm and sponsored a business and trade forum in the major Saudi urban center of Jeddah.

Brussels, the capital of Belgium and the de facto capital of the European Union, will host President Obama at the EU-U.S. Summit on March 26th.

On the eve of my departure for Brussels with the EU Press Delegation, I spoke with Marc Calceon, Consul General of Belgium in New York on trade and development within the nation.

A. Barnes: Moscow is the EU’s biggest trading partner. Currently, sanctions are pinpointing individuals, but could very well change to national sanctions soon. How will Belgium be affected economically by the Russia-Ukraine crisis as the EU intensifies its sanction standoff over Ukraine?
M. Calceon: It is possible that all of this could spill over into the economic area if it progresses. Of course Russia is an important trading partner for Belgium. It’s in the top ten or just outside of the top ten of all of our major trading partners. We import, especially, oil and diamonds from Russia, and we export chemical products and machinery. There is concern that there could be increased impact. Today there was a newspaper article that the fruit and vegetable sector in Belgium, which exports a lot of product to Russia, is afraid of the danger if these sanctions were to be expanded. Some sectors are more liable to be hit by sanctions than others as far as like gas imports from Russia; we only only import about 4 percent of our gas from Russia which is a better percentage when compared to other EU countries like Germany or other eastern European countries. In general, for the moment, I think the impact of sanctions everywhere else is limited because the sanctions are limited. Russia is definitely an important trading partner. Depending on the makeup of the products that we import and export, it could heavily impact us. In the energy field, the natural gas that the media keeps talking about, however, that is not that important to us at all. As for Ukraine, Ukraine is a really, rather small, trading partner of Belgium.

Princess Astrid recently traveled to the Port of Duqm to sign three development agreements and Saudi Arabia in a business & trade forum. What would relations with the Sultanate region and increased trade with Saudi Arabia mean for/benefit Belgium?
The reason for the trip to Oman is that this port- it’s developed together with the Port of Antwerp, which is one of the biggest ports in the world. So the trip was to recognize and further develop this relationship and to take advantage of getting to know Oman better. Oman is one of the forgotten, quiet countries in that region that is doing well but nobody talks about it. There are definitely interesting and fruitful possibilities there. The Port of Antwerp is developing the Port of Duqm, and in Saudi Arabia, of course, that’s an important country- as a trading partner and as a geopolitical strategic field. It was a time to go there and see all the possibilities for Belgian companies; it was a trade mission to see in what sectors our relations could expand or invest. We think that Saudi Arabia is one of the countries whose economy is going to develop itself on a rather sustained level in the next couple of years.

A publication called The National Interest wrote a recent article recommending the “Belgian solution” for Ukraine where they’d have internationally-recognized neutrality like Belgium, Switzerland and Austria have had historically. What are your thoughts for this suggestion as a solution for the state of Ukraine? Do you think that could work politically?
Historically, Belgium was obliged to be a neutral country in the 19th century until it became independent from The Netherlands, so between 1839 and 1914, we were neutral. This neutrality was a guarantee by the major European powers such as France, Great Britain, Germany, Russia and Austria/Hungary. Such neutrality can only work as long as you want it to work yourself, which in Belgium’s case was no problem and as long as people around you respect it. In 1914, the Germans did not respect it and they invaded Belgium because they thought it was the best way of getting to France. So, in that sense, the neutrality did not have any advantage for them and so they did not respect it. Therefore, in the case of Ukraine, I am not really sure if everyone involved would want Ukraine to be neutral. I am not sure if Ukraine itself wants to be neutral, so I have serious doubts that such a thing could work.

In general, you could say, neutrality only works if you want it yourself and if the surrounding countries, or the people that guarantee it, take it seriously.

The European economic crisis has greatly improved since 2008, but the public debt in Belgium is still considerably high. What’s being done to reduce this?
The public debt in Belgium has always been one of the highest in Europe. We have had high public debt for years. Also, the savings rate in Belgium is quite high. There are things happening, like in Spain, Greece and Portugal. Its not as big, but that does not mean the issues needs not be addressed. In this past decade, there have already been great efforts made to lower the public debt ratio to the GDP. It was lowered from about 130 percent to 80 percent and the reason it has gone up again is because of the financial crisis and the support that Belgium had to give to its banking sector, so it went back to 100 now. It went up during the financial crisis, however, at a completely different rate than in other countries. In other countries sometimes it went from 25 to 100 percent or from 50 to 90, so our debt during these past few years has gone up relatively a little. Still, in absolute terms, it’s definitely important to address this. We now have goals of a zero budget deficit, which we have to reach by 2016, so the different international institutions offer different types of advice as to which ways you should reduce the debt. The EU Commission is saying one thing while the IMF is saying it should be done more gradually. The economic crisis was not as harsh in the past few years in Belgium as it has been in other countries because we took some measures to mitigate austerity. This has worked quite well for us, so I am sure that in the next couple years it will further reduce the public debt in a gradual way to fulfill our international obligations.