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Belgian report
by Euro Reporter
2014-11-17 11:06:57
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Motives still unknown behind knife attack that wounded rabbi in Antwerp

A pan-European Jewish organization called on Saturday for European authorities to ensure the security of the continent's Jewish citizens after a rabbi was stabbed and hurt in Antwerp.

“Jews in Europe have lost a normal sense of security that worsens with every attack on Jews and Jewish institutions which are taking place with alarming regularity,” said European Jewish Congress (EJC) President Dr. Moshe Kantor.
While the motives were still unknown behind Saturday's attack in Belgium, Kantor urged political, judicial and law enforcement authorities to take action "to ensure that Jews feel free to walk the streets in the open and live their lives absent of the fear these attacks generate.”

According to initial reports, a 31-year-old Jewish man suffered serious wounds, but was not in a life-threatening condition after an assailant stabbed him in the neck Saturday morning in Antwerp. Police reportedly arrested one suspect, who was later found to have no involvement in the attack. The Jewish man was attacked while walking under a railway bridge near the second largest Belgian city's Jewish quarter when a passer-by attacked him with a knife, according to local reports.


Planned austerity measures in Belgium spark massive anti-government protests

Violence erupted in Brussels last week when over 100 000 protesters gathered in the streets of Brussels to protest the new government’s proposed budget cuts. Fighting escalated quickly after a peaceful demonstration organized by trade unions and left-wing parties. Protesters overturned cars and ignited fires as riot police failed to stop the demonstrations using water cannons and tear gas. Amidst the screaming and bantering and plumes of smoke billowing from burning cars, activists hurled stones and lit flares and fireworks. The police met the trade unionists armed with full riot gear and truncheons but activists were unperturbed as direct confrontation broke out. Officials say that at least 50 people were injured, and 30 detained so far. The protests, which began peacefully, were part of a plan devised by trade unions to oppose Prime Minister Charles Michel’s austerity measures. The new government plans to raise the pension age, freeze wages, and make cuts to the public sector all to meet EU-enforced targets. There are several strikes planned in the coming days, with a general strike across Belgium being organized for Dec. 15.

“They are hitting the workers, the unemployed,” said Phillipe Dubois, a worker from the industrial region of Liege. “They are not looking for money where it is, I mean people with a lot of money.” The government says the steep budget cuts are necessary if the country is to reduce the deficit and keep it at an affordable level. No one is buying it. Marie-Helene Ska, secretary general of the union CSC, says that the new government isn’t looking in the right place. “The government tells us and all of the parties tell us that there’s no alternative. We don’t contest that they have to find 11 billion euros [$13.6 billion], but we’ve been saying for a long time that it’s possible to find this money elsewhere, rather than in the pockets of the workers,” she said. Rail companies even lowered their ticket prices to allow more people to travel to Brussels where the protests took place. Unions reported that approximately 130,000 people attended last week’s protest, while police say the number was closer to 100,000. The last time such demonstrations against austerity took place was in Feb. 2013, bringing an estimated 40 000 people.

Workers from steel firms, ports, the post office and school boards are all planning a work slow-down next month. In response, the Belgian cabinet has planned a crisis meeting with the country’s three main unions, but any compromise is unlikely to favour the unions. Belgium has a long-standing tradition of collective bargaining between employers and employees. Their long lines of coalition governments, often representing a full spectrum of public opinion, have been able to guide the country through many periods of unrest and disagreement. However, the current government, formed by three pro-business parties and the centrist Christian Democrats is the first in decades to try and push a staunchly free-market agenda. As part of their economic plan, the government is not implementing next year’s automatic cost-of-living raises, a decision strongly opposed by green, socialist, and left-wing trade union parties. The government is also planning to raise the retirement age from 65 to 66 in 2025 and to 67 in 2030. Belgium isn’t unique in this regard. After decades of cradle-to-grave welfare, countries across the European Union are having to deal with the fact they’ve been living far beyond their means.


Belgium new sick man of Europe on debt-trap fears

Belgium is creeping back onto the eurozone's danger list as economic woes spread deeper into the EMU-core, and protracted slump poisons debt dynamics. Fitch Ratings has issued a downgrade alert, warning that the country's primary budget surplus is evaporating. It said public debt will reach 106.9pc of GDP next year. New accounting rules known as ESA2010 have revealed that Belgium is poorer than previously thought, lifting the debt ratio by 3.3pc of GDP overnight. This is in stark contrast to the upgrade for Britain, Ireland, and Finland, all deemed to be richer and therefore less troubled by debt. The agency said Belgium is ever further out of line among its AA-rated peers worldwide, which have a median debt ratio of 37pc. "Public debt dynamics have deteriorated owing to weaker real GDP growth and worse fiscal performance," it said. Yields on 10-year Belgian bonds fell to an historic low of 1.1pc in early November - sliding in lockstep with German Bunds - but it is unclear whether this can last if markets start to focus on the economic fundamentals of EMU once again. The country is caught in a debt compound trap, much like southern European states. The toxic mix of near-zero growth and very low inflation is automatically causing the debt trajectory to ratchet upwards. The ratio was 99.7pc in 2013.

Belgium has so far failed to reach "escape velocity" after stagnating for almost three years. The European Commission has cut its growth estimate to 0.9pc this year and in 2015, too low to stabilize the debt. Belgium has been in consumer price deflation for the last eight months, when adjusted for taxes. The Commission said the debt ratio will reach 107.8pc by 2016, and warned that it could spiral much higher if there is a deflationary shock. Indeed, it came out worse than Italy in the stress test scenario. Belgium weathered the early phase of the Great Recession in better shape than much of Europe. It is one of the few eurozone states to have surpassed its pre-Lehman peak in output, yet there has been a slow rot beneath the surface. "The economy has been losing competitiveness due to higher labour cost and lower productivity growths than peer countries," said the International Monetary Fund in its most recent 'Article IV' report on the country. Belgium had a current account deficit of 1.7pc of GDP last year despite flat consumption and a drastic 10.3pc contraction in public investment. It has almost completely halted purchases of military equipment, running down its old stock of tanks, aircraft, and communications equipment.

The IMF said Belgium's unit labour costs have been rising faster than those of France, Germany, or the Netherlands since 2005. This is partly due to "gaps in innovation and education", and to slippage in the "knowledge-intensive sector". New patents have been declining since the late 1990s. What is striking is that maths and science scores in schools have been deteriorating, even compared to other EMU states, let alone East Asia. Belgium has the highest "implicit tax on labour" at 42pc and higher electricity costs than Germany or France. The effective retirement age is very low at 59. Fitch said Belgium still has deep strengths and has lengthened the maturity of its debt to 7.7 years from 6.0 in 2010, creating a margin of safety if rates spike. It has ample household savings and a net international investment position (NIIP) above 30pc of GDP. However, the budget deficit will overshoot its agreed EU target by 0.6pc of GDP this year, ending at 3pc. Earlier hopes of a primary surplus have come to nothing. The clear risk for Belgium is that it will run down it stock of wealth from past economic success, drifting into a slow crisis as debt ratios reach a point of return. It is looking ever more like Europe's trial run for a "Japan" scenario, but without its own central bank to mitigate the effects.


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