It is seldom mentioned how much shared history Hungary and Belgium have. In addition to dynastic relations, there are many instances where the two states were each other’s supporters: the reception of Hungarian refugees in Belgium after 1956 and Hungarian grain aid to the Belgians have become forgotten points in history. However, the relationship between the two countries is interesting not only from a diplomatic but also from an economic point of view: in Hungary, Belgium has been the seventh/eighth most important investor for many years. In addition to a brief overview of the Belgian economy, we will also discuss the often-forgotten details of Hungarian-Belgian relations and the bilateral economic relationship in our analysis.
The state of the Belgian economy – a general overview
Belgium’s geographical location and characteristics allowed it to develop a modern market economy early on. Its network of canals and railways and its seaports are well developed, giving the country all the means to connect its economy’s parts in the fastest and most advanced way. Given its geographical position at the heart of Western Europe, its economic situation is also largely determined by the state of the European Union and the world economy. Belgium has a well-developed industrial base, with the industrial revolution having taken place relatively early in the country, in the early 1800s. This has had a positive impact on the further development of the sector, which is still a key factor in the Belgian economy today.
Belgium’s mining and steel industries are significant; the former developed around Liége, the latter around Charleroi, and they maintained their position until the mid-20th century. The Second World War and its effects on the economy were also felt here: the chemical and oil industries in Belgium began to develop, but the oil crises of 1973 and 1979 plunged the Belgian economy into a long recession. As a result, steel production fell sharply and has still not recovered to its previous levels (Lloyd Banks, 2024). In addition to the Belgian economy as a whole, this has had a major impact on the development of the Walloon Region, which was the centre of steel production. Industrial development has extended beyond steel to most other sectors, and Belgium is now well positioned in the automotive, pharmaceutical, textile, electrical and electronics sectors too. The share of agriculture is low: according to GDP data for 2023, agriculture contributed 0.77% to GDP, the services sector 71.1% and industry 18.53% (Statista.com, 2025). This also means that the services sector has a very high share in the Belgian economy. The EU headquarters in Brussels is also of particular importance. The tens of thousands of EU diplomats as well as the investment in institutions and infrastructure that EU developments bring have a positive impact on the potential of the country’s economy as a whole.
The global crisis of 2008 and 2009 left a deep mark on the Belgian economy. In 2009, real GDP contracted by -2.02% compared to the previous year, and although data for 2010 and 2011 showed that the Belgian economy had started to recover somewhat, from 2012 onwards real GDP growth again declined significantly. More stable growth started to emerge in 2014, when both the gross public debt-to-GDP ratio and the current account balance began to improve (IMF, UNCTAD, 2024). The recovery from the crisis was helped by a government programme to support the hard-hit industrial and service sectors during the crisis years. This included a reduction in VAT (value added tax) on construction and energy bills and a EUR 3.5 billion reimbursable grant from the Belgian state to the KBC banking group (Government of Hungary, 2014). As a consequence of the crisis, unemployment also started to rise: in 2008, the unemployment rate in Belgium was 7%, reaching 8.7% by the end of the crisis in 2014. The decline started around 2014-2015, after which the unemployment rate in the country has been steadily decreasing, reaching 5.4% in 2019 (IMF, 2024).
Figure 1: Change in some Belgian macroeconomic indicators between 2010 and 2024 (in percentage terms) Source: UNCTAD, 2024. IMF, 2024. 2024 data are provisional.
The impact of the 2020 coronavirus pandemic again turned the economy on its head, with real GDP falling by 5.26% compared to the previous year (2019), a record low since the Belgian economy had not experienced such a slump even during the 2008/2009 crisis. The bounce-back in economic expansion started relatively soon, with a 6.85% year-on-year expansion in 2021, but only much more moderate and slower growth was achieved in both 2022, 2023 and 2024 (UNCTAD, 2024). From 2020 onwards, gross public debt, which had been kept at a more disciplined level until then, also started to increase, mainly due to the disbursement of public subsidies and other ways of managing the crisis. Inflation did not start to rise at that time, with an inflation rate of 0.43% in 2020, although a year later a rise of 3.22% was recorded (IMF, 2025). Belgian inflation was more adversely affected by the Russia-Ukraine war of 2022, when the consumer price index rate rose to 10.33%. The surge in energy prices played a role in the sudden increase, in addition to the rise in food prices (NBB Review, 2023). Inflation was contained in the following two years, with the consumer price index rate reaching 0.5% in 2023 and accelerating again to 2.7% in 2024.
Belgium’s foreign trade is particularly important to the country’s economy, with total exports in some years even reaching the value of annual national income. Thanks to its favourable geographical location, it has close trade links with all Western European countries and, thanks to its maritime connections, it can export its goods to many parts of the world. Belgium is one of the most open economies in the European Union, ranking 6th among European countries in the Trade Openness Index in 2023 (Trade Openness, The Global Economy, 2024). At that time, its economic openness index score was 168.93%, high above the average of 125.17% in 2023 (Trade Openness, The Global Economy, 2024). The share of exports in total Belgian GDP reached 84.16% in 2023, which in numerical terms amounted to USD 535,313 million (UNCTAD, 2024).
Figure 2: Change in the value of Belgium’s external trade between 2010 and 2023 (current prices, in millions of USD) Source: UNCTAD, 2024.
Belgium’s main export partners are its neighbours the Netherlands, France and Germany. These three countries account for almost 50% of Belgium’s exports (OEC World, 2025). Among European countries, a significant share of Belgium’s exports is also directed to Italy, Spain and the United Kingdom, and among overseas countries, it has close trade links with the US. In the Asian region, it mainly imports from and exports to China. On the export side, the structure of Belgium’s foreign trade is dominated by refined petroleum products (8.5%), vehicles (5.62%), vaccines (6.44%) and diamonds (2.65%). On the import side, the structure is similar, with a high share of energy products, pharmaceuticals, medical devices, vehicles and electronic equipment (OEC World, 2025). The Netherlands, Germany and France are Belgium’s top import partners, but there is also high value trade with Ireland, Italy and the UK (OEC World, 2025). Alongside the US and China, Japan is also represented in imports, as well as Qatar, India and, to a lesser extent, Turkey.
The graph also shows that Belgian foreign trade started to decline between 2015 and 2017, affected by the Russian-Ukrainian situation and international sanctions against Russia. Until 2014, an average of 1-1.5% of Belgian exports, i.e. between USD 4-4,500 million, went to Russia. On the import side, the share of Russian products in Belgium was much higher, reaching up to 3%, or USD 10,800 million (OEC World, 2025). In addition to the products already mentioned, Belgium exported fruit (mainly apples and pears), metal products, chocolate and animal feed to Russia. On the import side, fossil fuels accounted for more than 30%; in addition, diamonds (31.9%), copper wire (8.34%) and other metal products, as well as ammonia (2.76%) were also imported from Russia (OEC World, 2025). After 2014, the share of fossil fuels in Belgium’s imports of goods from Russia started to decrease, but from 2017 onwards the figures started to increase again (OEC World, 2025). Despite the Russian-Ukrainian war in 2022, a significant share of oil and fuel imports continue to come to Belgium from Russia. Russia’s share among foreign trade partners has thus decreased, but the products coming from here are still concentrated in the fossil fuels-diamonds-metal products group (OEC World, 2025).
Foreign capital flows are also of great importance for the Belgian economy. According to the World Investment Report 2024, Belgium was ranked 16th globally in terms of foreign capital inflows in 2023 (World Investment Report, 2024). The largest investors in Belgium are France, Germany, the US, the UK and Italy. The bulk of investments goes to the financial and insurance sectors, as well as manufacturing, professional, scientific and technical activities (World Investment Report, 2024). Belgium is an attractive investment destination for a number of reasons: firstly, its favourable geographical location places it at the crossroads of European markets. As a result, it offers investors the widest possible range of logistical and infrastructure opportunities. A stable society and a high quality workforce are also important. The new Belgian foreign investment screening rules came into force on 1 July 2023. Transactions signed from this date on are subject to mandatory prior notification to the Interfederal Screening Committee (ISC). The rules apply to transactions in which a foreign investor acquires “control” of a Belgian strategic unit or acquires voting rights (10% or 25%, depending on the sector) in such an organisation. The notification thresholds vary depending on the sector concerned, including healthcare, energy, transport, artificial intelligence, aerospace industry, media, biotechnology, etc. (Lloyd Banks, 2024).
Figure 3: Changes in Belgian FDI flows and current account balance value between 2010 and 2023 (in millions of USD at current prices). Source: UNCTAD, 2024.
In addition to attracting high levels of foreign capital, Belgium is also a major source of FDI abroad. In recent years, the amount of capital outflows has often exceeded the amount of FDI inflows. The destination countries for capital outflows are similar to those for FDI inflows: Germany, France, US, UK, plus Luxembourg, Turkey, Cyprus, China and Singapore (OECD, 2023). The majority of Belgian FDI outflows are directed to the services sector – the financial and insurance group in particular –, with a smaller share in manufacturing (OECD, 2023).
Belgium can therefore be considered a stable country in economic terms, but its growth situation is hampered by a number of problems, mainly socio-economic, which may take a long time to be effectively addressed. One such issue is immigration, which has increased the Belgian population but the country’s birth rate is steadily declining. This, in addition to the ageing of society, is also having an impact on the growing tensions between the Belgian and immigrant populations. Another serious problem is the rising cost of living. Average wages in Belgium are more or less tracking potential expenditure, but housing and living costs are gradually rising. Depending on where and how large a flat one rents, rents can be as high as 50% of average salaries. This phenomenon can be observed not only in Belgium, but throughout Europe, creating a serious housing crisis. Lastly, there is the economic divide within the country, which we have already briefly mentioned. The industrial base, which is considered to be economically stronger in Flanders, is concentrated in the north of the country. In the south of the country, Wallonia, manufacturing and tourism activities are stronger, but this does not offer sufficient prospects for the region to catch up with the north. During the years of the steel crisis, Wallonia was definitively left behind Flanders, and this has not been harmonised with economic policy decisions since then.
The development of economic and diplomatic relations between Hungary and Belgium since the 19th century
Hungarian-Belgian relations have shown many points of contact throughout history. Nicolas de Kun de Kozma, or Miklós Kun in Hungarian, in his extensive work on the subject, traces the sites of encounters and cooperation between the two peoples back to 5700 BC. We do not wish to go into the development of bilateral relations in such depth in this analysis, but the events of the 19th century do require us to briefly outline the Hungarian-Belgian relationship.
Before the Hungarian Revolution and War of Independence of 1848 and 1849, a revolt along similar lines had broken out in Belgium in 1831. As a result, the Belgian constitution was born and the country’s form of government became a parliamentary monarchy (De Kun, 1999). The constitution was not only a Belgian model, but also a European one, and similarities with the Belgian source can be found in several European countries. The document also became a reference point for bourgeois reformers during the Hungarian Revolution and War of Independence that broke out in 1848. While the Belgian Revolution was, so to speak, a success, the Hungarian Revolution could not achieve the same result. During the retribution, many Hungarian emigrants sought refuge in Belgium, where they were welcomed. Among others, Lajos Kossuth’s mother, who lived in Brussels until her death in 1852, found a new home here (Múlt-Kor, 2015).
The Belgians reappear in the second half of the 19th century, now in Hungarian economic relations. After the Austro-Hungarian Compromise of 1867, the flow of foreign capital to Hungary began to increase, with Belgium as an important source country. Belgian investors could be found in mining (mainly coal), railway construction and banking (Berend T – Szuhay, 1978). Belgium was also an important foreign trade partner for Hungary, as a significant part of the textile imports came from this Western European country. Besides woven fabrics, a high proportion of data on imports of arms and machinery can be found in contemporary statistics (Berend T – Szuhay, 1978).
Diplomatic relations between the two countries were not established for a relatively long time, and it was only after the First World War that steps in this direction were taken. On 20 February 1922, the first Belgian diplomatic mission of Hungary in Brussels, headed by Count Olivér Woracziczky, started its work (De Kun, 1999). This was greatly influenced by the Belgian position after the First World War, when more than 20,000 children were transported from Hungary to Belgium by the so-called “children’s train” (Hermán M., 1998). Here, the children were placed with different families with the aim of dealing with the horrors of war, psychological and other trauma.
During the Second World War, Hungary was able to reciprocate the earlier support. Belgium received Hungarian aid on several occasions over the years, mainly in the form of medicine and cereals (Diplomatie Belgium, 2022). The “children’s train” was also in operation again after this, with Hungarian children again being placed with Belgian families.
The Second World War and the decades that followed, separated by the Iron Curtain, made it difficult to deepen bilateral relations for a long time. After the Hungarian Revolution in 1956, more than 7,000 Hungarian refugees were granted asylum in Belgium, further deepening the relationship between the two countries, although the contrasting political systems prevented it from developing. Among the refugees, one of the best known is Alexandre Lamfalussy, or Sándor Lámfalussy in Hungarian, who was the founder of the European Monetary Institute. He is also considered one of the fathers of the euro (Diplomatie Belgium, 2022).
A change in bilateral relations could begin in the second half of the 1970s, when the Consular Convention between the People’s Republic of Hungary and the Kingdom of Belgium was signed in 1976 (Jogtár, 2025), which allowed the parties concerned to establish a diplomatic mission in each other’s territory, with the primary aim of strengthening friendly relations between the two countries, as well as deepening economic, cultural, scientific, commercial and tourist relations (Jogtár, Article 28, 2025). The Hungarian Foreign Policy Yearbook (Magyar Külpolitikai Évkönyv) reports that almost every year thereafter, some form of meeting and consultation between the political leaders of the two countries took place (Magyar Külpolitikai Évkönyv, 2010).
In the years following the regime change, in addition to partnership talks, the broadening of economic relations became increasingly important in Hungarian-Belgian relations. As early as June 1990, King Baudouin, the Belgian Head of State met with Árpád Göncz, the then temporarily appointed President, in Budapest. During the talks, the King of Belgium also held talks with Prime Minister József Antall and György Szabad, the Speaker Designate of the National Assembly (Magyar Külpolitikai Évkönyv, 1990). In addition to diplomatic talks, bilateral trade also began to grow. The value of Hungarian product exports to Belgium reached USD 1,150 million at the turn of the millennium, accounting for 3.71% of total exports (OEC World, 2025).
Figure 4: Change in the value of Hungarian-Belgian trade in goods between 2010 and 2023 (in millions of USD). Source: OEC World, 2025.
Over the past more than thirteen years, trade between the two countries has continued to grow. Hungary exports mainly electronic equipment, vehicles and transport equipment, and chemical products to Belgium. In 2023, Hungarian exports of goods to Belgium reached USD 3,880 million (OEC World, 2025). As the Hungarian surplus was already higher in 2022 and 2023, the previous trend of Belgian-Hungarian trade in goods seems to be reversing. On the import side, the main products from Belgium to Hungary are pharmaceuticals, vaccines, electronic equipment, chemical products, vehicles and transport equipment, and metal products (OEC World, 2025). Textile goods still enter Hungary from Belgium in remarkable quantities. In 2023, USD 120 million worth of clothing and USD 60 million worth of footwear arrived, of which 37.8% was leather-based footwear (OEC World, 2025). The concentration of steel and metal products is also reflected in Hungarian imports. Various Belgian metal products accounted for USD 228 million of the Hungarian import structure in 2023 (OEC World, 2025).
At the initiative of the Wallonia-Brussels and Flemish export promotion and investment agencies (AWEX, Fitagency), the Belgian Business Club was established in 2015 to deepen and further develop Hungarian-Belgian economic relations, with the aim of encouraging investment between the two countries (Belgabiz, 2025). They also provide prospective investors with the opportunity to attend events where they can find out directly about the opportunities and the legal and economic situation in the other country (Belgabiz, 2025). The initiative was not without reason, as Belgian companies have been present in the Hungarian economy for a long time and vice versa. One of the best known Belgian companies operating in Hungary is K&H Bank, a member of the KBC Group. K&H entered the Hungarian market before the regime change and has been a stable part of the Hungarian banking scene ever since. Further Belgian companies operating in Hungary include:
- the lighting technology company Tungsram-Schréder,
- Sinia, a company active in the furniture industry,
- packaging technology companies Van Genechten Packaging and Packapime,
- Atenor, a real estate development company,
- and vaccine manufacturer GSK Vaccines.
Figure 5: Change in the value of Hungarian-Belgian FDI shares between 2010 and 2023 (in million euros). Source: MNB, 2024.
Belgium has been a stable investor in Hungary for a long time, with more than EUR 1,230 million invested in Hungary since the regime change in 1990. In addition to the companies already listed, there are Belgian companies in many other sectors, more than 200 in all. It is also worth taking into account companies that are Belgian but invest in Hungary from the Netherlands or Luxembourg rather than from Belgium. In the general statistics, these are mostly shown as Dutch or Luxembourg capital investments. For Hungarian companies, entering the Belgian market is not yet popular, with domestic companies mainly looking to the countries of our region, as well as Austria and Germany.
Summary and conclusion
Belgium, as a Western European country that has made the most of its geographical advantages, is now one of the most developing EU countries. At the heart of the continent, it is connected to as many trading partners as possible, and its seaports allow Belgian products to reach many parts of the world. However, this openness also carries a risk, as the development of world trade and the world economy has a strong impact on the Belgian economy too.
As we have seen, Hungarian-Belgian relations have a long history. During the two world wars the two countries helped each other out, and after the events of 1956 a significant Hungarian ethnic group was formed in Belgium. Although the Hungarian-EU dialogue is often fraught with political disagreements, this does not negatively affect the Hungarian-Belgian relationship. In recent years, economic and trade relations between the two sides have continued to expand, which is beneficial for the economies of both countries.
