Over the 2010-2020 period, the Belgian GDP increased by 6.6%, totalling EUR 416.4 billion in 2020. However, in 2020 it recorded a 6.3% decline compared to the 2019 level.
In line with the economy, the number of enterprises in the broad construction sector increased by 25.1% between 2010 and 2019, reaching 192,068 in 2019. In 2020, it decreased by 3.5% as compared to the 2019 level, amounting to 185,340. Thus, over the 2010‑2020 period, the number on enterprises increased by 20.7%. Compared to 2019 level, the most significant declines were reported by the manufacturing sub‑sector (‑7.9%), followed by the narrow construction sub‑sector (‑6.2%) in 2020.
The volume index of production in the broad construction sector increased by 2.8% between 2015 and 2019 before declining by 8.2% in 2020. This decrease is mainly due to a 9.0% decline in the production of construction of buildings and a 6.2% decrease in the production of construction of civil engineering in 2020 as compared to 2019 level.
Total turnover in the Belgian broad construction sector increased to EUR 103.5 billion in 2018 and reached EUR 103.8 billion in 2020. This represented an overall increment of 25.2% since 2010 and was primarily driven by growth in three sub‑sectors – the real estate activities (+72.5%), the architectural and engineering activities (+25.0%) and the narrow construction (+23.6%) sub-sectors over the 2010-2020 period.
The gross operating rate of the Belgian broad construction sector, an indicator of the sector’s profitability, stood at 15.4% in 2018, slightly above the 2010 level of 14.5%. The real estate activities remained the most profitable sub-sector (39.9%), followed by the architectural and engineering activities (17.7%), the manufacturing (12.3%) and the narrow construction (10.8%) sub-sectors in 2018.
With regards to employment, 524,453 persons were employed in 2019, representing an increase of 16.0% as compared to 2010 level. In contrast, this decreased to 501,390 persons in 2020, indicating an annual decline of 4.4% in 2020. Overall, the total number of persons employed increased by 10.9% between 2010 and 2020. Compared to 2019, the most significant declines were reported in the manufacturing (‑7.6%) sub‑sector, followed by the narrow construction (‑5.9%) sub‑sector in 2020.
The Belgian government – including through the regional governments, launched numerous initiatives to promote the broad construction sector, by supporting e.g. the development of the housing market. For instance, in Brussels, under the Regional Housing Plan and the Habitat Alliance, the government is leading the sustainable renovation of existing housing stock in addition to the construction of 6,400 new housing units. Private sector actors are also active in this field. In February 2021, institutional asset managers Bouwinvest Real Estate Investors and CBRE Global Investment Partners (GIP) teamed up with ION, a Belgian real estate developer, to invest EUR 280.0 million in affordable housing. As per their agreement, the amount will be invested in building 1,000 affordable new houses and apartments exclusively for the rental market.
With regards to the civil engineering market, the Belgian government has initiated various projects such as the construction of a regional express network (RER) around Brussels, a second rail access to the port of Antwerp and additional tracks between Ghent and Bruges, as well as Bruges and Zeebrugge. The federal rail investment strategy is set out in the Multiannual Strategic Investment Plan 2018-2031, amounting EUR 1.2 billion. Through these projects, the government plans to promote and support a gradual shift in modes of transit from roads to railways.
Belgian railways are set to receive an additional EUR 250.0 million over the next three years, as per the 2021 national budget.Most of this amount will be invested in infrastructure, to further develop rail freight transport.
At the regional level, the government of the Brussels-Capital Region has extended the Multiannual Investment Plan for Public Transport until 2028, involving investment of more than EUR 6.0 billion for the three main transportation modes: metro, tram and bus. The Flanders region is also adopting an integrated investment programme called "Geïntegreerd Investeringsprogramma" (GIP), involving a total investment of EUR 1.9 billion in mobility and public works.
Under its Recovery and Resilience Plan (RRP), Belgium will invest EUR 1,012.0 million of the total allocation in the renovation of its building stock.
This includes EUR 264.0 million for improving renovation subsidy schemes as well as EUR 98.4 million on social housing renovation in the Flemish and Brussels-Capital regions and the German-speaking Community. Around EUR 636.3 million has been allotted to renovation in the public sector including schools (EUR 230.8 million), universities, sports, and cultural facilities (EUR 210.3 million), and other public buildings (EUR 195.2 million).
In fact, the RRP dedicates 56% of its budget for infrastructure projects such as the renovation of buildings, including schools, the construction of new generation CO2 capture and hydrogen transport energy networks, the renovation and construction of transport infrastructure (mainly bicycles and railways) or digital infrastructure (5G, optical fibres) etc.
In addition, the regional and federal governments have decided on additional stimulus measures and investments from their own budgets.
Despite these initiatives, the Belgian broad construction sector faces two major challenges. Firstly, the construction sector continues to suffer from the on‑going shortage of skilled workers, along with a skills mismatch for existing roles. Secondly, late payments continue to be a major concern, which has further deteriorated due to the outbreak of COVID-19 pandemic.
Overall, the Belgian construction sector has a positive outlook. The civil engineering markets are expected to be the primary growth drivers. Additionally, investment in public sector infrastructure, digitalisation as well as a circular and green economy, backed by EU funding, is expected to lead the future growth of the sector.