Belgium : gateway to Europe

1. Belgium : gateway to Europe An overview of the Belgian economy By Philippe Donnay,Economic advisor Federation of Enterprises in Belgium

2. Belgium : Gateway to Europe • Belgium, at the heart of Europe • “State of the art”-infrastructure • A multilingual, well-educated and motivated workforce • An open and attractive economy

3. Belgium: at the heart of Europe United Kingdom Netherlands Germany Luxembourg France

4. Belgium: at the heart of Europe • Brussels • capital of Belgium • capital of the EU • headquarters of NATO • 1,700 European headquarters of MNOs • world’s fourth international meetings and conferences center • second largest concentration of journalists in the world

5. Belgium: at the heart of Europe • Belgium is at the heart of : • three cultures, • the Europe of the 15, • a 370 million Consumers Market. Do you know that 60% of the European market is located at less then one driving day ?

6. Belgium : Gateway to Europe • Belgium, at the heart of Europe • “State of the art”-infrastructure • A multilingual, well-educated and motivated workforce • An open and attractive economy

7. A Highly Developped Road Network Road Infrastructure Density Km/sq.Km Source: Competitiveness Yearbook 2003

8. A Dense Railway network USA= base 100 Railway network Density /sq.km Source: Competitiveness Yearbook 2003

9. Air Infrastructure • Numerous intra-European and inter-continental air connections • Brussels Airport – Zaventem • worldwide passenger and cargo services • Ostend – Bruges Airport • mainly cargo services • Deurne Airport • European passenger services (e.g. London, Berlin, Dublin, • Geneva) • Liege Airport • top ten European air freight hub (380 000 T handled in 2003) • Charleroi Airport • passenger terminal; hub a.o. to Ryan Air

10. Water Infrastructure

11. Antwerp 2nd largest port in Europe, 4th largest worldwide (140 mln. tonnes of cargo/year) Largest petrochemical complex in Europe, 2nd largest worldwide Zeebruges Leading port in the car sector (1 577 618 cars) Ghent 23,9 mln. tonnes seaborne cargo traffic (wide variety of cargo) Ostend Handling goods and passenger services Liège Second largest European River Port (27 mio T loaded/unloaded 2002) Brussels Maritime harbour with ships up to 4,500 Tons Strepy-Thieu Most advanced boat lift - 1.1350 t Water Infrastructure

12. Belgium : Gateway to Europe • Belgium, at the heart of Europe • “State of the art”-infrastructure • A multilingual, well-educated and motivated workforce • An open and attractive economy

13. Anglo-saxon Germanic Romanic Multilingual Workforce Source: OCDE 2000

14. (Out of 10) Ability to Recruit New Talents Is it easy to have access to a skilled labor force in your region ? Source: Competitiveness Yearbook 2003

15. Absenteeism Absenteeism rate in % of hours normally worked Source:Eurostat

16. Belgium : Gateway to Europe • Belgium, at the heart of Europe • “State of the art”-infrastructure • A multilingual, well-educated and motivated workforce • An open and attractive economy

17. Belgium: hub of Europe Belgium EU Exports Imports

18. 42,45 1. Germany 37,16 2. France 26,61 3. Netherlands 21,95 4. UK 17,78 5. U.S.A. 22,18 1. Chemicals and pharmaceuticals 14,41 2. Transport equipment 13,54 3. Machinery and equipment 13,4 4. Plastics 5. Diamonds and 10,7 precious metals Top five export nations in 2003 (bn EUR) Exports of Belgium Top five export products in 2003 (in %)

19. Belgium : A wealthy country

20. Effective tax rates 2001 Source : The Effective Tax Burden of Companies in the Member states of EU Source : Baker & MçKenzie 2000 Many Fiscal Opportunities For Foreign Investors … ON ALL LEVELS OF YOUR INVESTMENT • The Corporation • Real estate and equipment depreciation system • Special tax agreements: fiscal rulings • Low effective corporate tax rate: many tax rebates applicable and as from 1-1-2006 : notional interest deduction • The Shareholder • no taxation on capital gain • The Management • attractive fiscal system for expatriates

21. Notional interest deduction • A new innovative tax feature in international tax low • What is it ? • A notional interest calculated and deducted yearly from the taxable basis • Used to off-set operational or financial income (lower effective tax rate) • Automatically applicable to all Belgian companies and branches of foreign companies

22. Notional interest deduction • Reduce the tax discrimination between debt-financing and equity-financing • Lower the effective corporate tax rate for all companies (higher after-tax return on investment) • Strenghthen the financial position of companies and branches by increasing their equity

23. Notional interest deduction • How does it work ? Annual Tax Deduction = Equity x Rate

24. Madein Belgium • Producer of the largest number of cars per capita in the EU. • The world's second largest petrochemical centre. • One third of all dredging work in the world done by Belgian companies. • The world's leading exporter of synthetic carpets. • By far the world's largest diamond centre. • Belgian fashion is recognized on the international scene. • Renowned all over the world for chocolates, biscuits, beer and endives.