Brussels: beyond the political tumult

"Unity is strength": reading the pitiful account of the picrocholine wars that have been undermining local political society since last June, one might think that the Belgian national motto is nothing more than a pious and sterile wish. But those who think they're in for a bloody civil war when they get out of the Thalys train to Brussels are in for a big disappointment. Good humour, good food and pretty squares: Brussels has lost none of its energy or charm, and it would be hard to detect any sign of animosity, or even concern.

And with good reason: apart from a windfall for newspaper sales, the political crisis has had only a limited impact on the economy of Belgium in general, and Brussels in particular, where almost 20 % of the gross national product is generated, with increasing specialisation in cutting-edge sectors. The launch on 12 November of a new incubator on the Arsenal site in Etterbeek - one of the 19 communes that make up the city of Brussels - even signals the strengthening of Brussels' position in the field of information and communication technologies (ICT). The Brussels Enterprise Agency (ABE), which lists 2,000 ICT companies in Brussels with an annual turnover of 4.5 billion euros, points out that "a third of ICT activities in Belgium are conducted from Brussels" and that at global level "Brussels ranks among the ten most important hub cities for Internet activity and among the top 20 telecommunications centres". We know the pioneering virtue of a country that has been wired at 97 % for many years; now we discover that of a nation where ADSL, e-commerce and VoIP have penetration rates higher than those found in neighbouring (southern) countries...

13,000 lobbyists in the city

Another high-tech spearhead of the Brussels economy is health and biotechnology, federated by the presence of major pharmaceutical multinationals, but above all driven by some 600 innovative companies. This research capacity recently received a surprising boost from the American magazine The Scientist, whose readers chose to place Belgium in first place in the world ranking of the "best countries for academic research", ahead of the United States. The boost came from the government - or at least its equivalent - which last October relaxed the procedures for obtaining work permits for foreign researchers wishing to set up in Belgium.

But it's not just in biotechnology that the world meets up in Brussels, which now derives a large part of its resources and activity from its status as a major international capital. Home to the majority of European institutions (Commission, Council of the European Union, European Council, Economic and Social Committee, Parliamentary committees, etc.), the headquarters of NATO and the main international trade union organisations such as the European Trade Union Confederation and the World Confederation of Labour, Brussels has seen a myriad of regional representation offices, NGOs, law firms and consultancies gravitate mainly around the European orbit of the Berlaymont building. With 13,000 registered lobbyists and nearly 800 accredited permanent journalists, Brussels is second only to Washington on both counts. "Brussels, an international city": the expression has become a cliché, but it is also self-evident in a city where almost a third of the inhabitants are now of foreign nationality.

Record international investment

This 'international' touch, added to Belgium's atavistic multilingualism and the central location of a city less than 300 kilometres from Paris as well as Cologne, Amsterdam and London, makes Brussels a proven star in the rankings of consultancy and rating agencies. Brussels is ahead of Madrid, Berlin, Milan and Geneva in Cushman & Wakefield's latest ranking of the 'best business locations', while Mercer Human Resource Consulting ranks it as one of the least expensive cities in Europe. Similarly, Belgium was ranked in the top 5 European cities in Ernst & Young's 2007 'Investor Barometer'. More surprisingly, the latest "report on international investment" published by UNCTAD places Belgium in fourth place worldwide for receiving direct international investment (FDI), thanks to a doubling of FDI in 2006. French companies are actively participating in this rush, as Belgium is the world's fourth-largest destination for French FDI, behind the United States, the United Kingdom and the Netherlands, but ahead of Germany.

Some local rigidities

For foreign investors, however, Belgium is not without its worries. Here again, these have less to do with a necessarily solvable "political instability" than with persistent local rigidities. At a press conference on 16 November last, Denise R. Rutherford, President of the American Chamber of Commerce in Belgium, gave a brief listing, criticising "the growing shortage of skilled labour, the lack of flexibility in a labour market that is tending to become increasingly globalised" and the tax system, which is deemed unattractive to businesses. These are all rigidities which, of course, find a comfortable breeding ground in the political sluggishness.