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IMF Warns Belgium of Economy Failure

Service : Economy
TEHRAN, April 7 (ICANA) - The International Monetary Fund (IMF) has warned Belgium that the country's 10-month political deadlock will further harm the country's struggling economy.
Thursday, April 07, 2011 2:26:27 PM
IMF Warns Belgium of Economy Failure

The IMF says that due to its limited powers, Belgium's interim government is not capable of tackling the country's sovereign debt equivalent to 94 percent of its GDP -- gross domestic product, a Press TV correspondent reported on Wednesday.

Economist Zsolt Darvas, however, has a different opinion.

“As far as the parliament is able to function and pass the budget and the public administration is able to operate, then I don't think that a lack of government has any serious impact on the Belgian economy,” he argued.

A spokesperson for the interim government has said that Belgium's economy has grown by two percent last year, while the same growth is expected in 2011.

He added that the transitional government has drafted a budget aimed at minimizing the country's deficit this year to 3.6 percent of the GDP, from 4.1 percent last year.

Belgium held elections last June but the vote failed to produce an agreeable winner between the country's Flemish-speaking north and the French-speaking south.

The north desires more fiscal and social autonomy for the region, while the south is concerned about a decentralization leading to a loss of subsidies.

The crisis grew deeper after the powerful Flemish separatists refused to discuss a plan to give the country's Dutch and French-speaking regions more power.

Belgium currently holds the world record for not having a government for 10 months.

The Flemish and the French have been in conflict in Belgium since the birth of the country's kingdom in 1830.

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