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US top 50 worth €1.7bn to Belgium
The top 50 American companies in Belgium contributed €1.7 billion in taxes and social security payments to the state coffers in 2012. This finding, and many others, is contained in the recently released report The Importance of US Companies in Belgium, published by the American Chamber of Commerce in Belgium (AmCham).
Those 50 companies also provide more than 90,000 jobs, representing 3.5% of the country’s total private-sector employment. And the story doesn’t end here: there are well over 1,000 US firms with affiliates in Belgium.
The largest employer is HR consulting group Manpower with more than 14,000 employees, followed by Gosselies-based Caterpillar, pharmaceutical group Johnson and Johnson and carmaker Ford.
Yet while the numbers remain impressive, total employment by US firms dropped 3% last year with job cuts at Ford, Caterpillar, HP, Procter & Gamble, Kraft and Coca Cola. The economic crisis is primarily responsible, though structural changes in Belgium’s economic performance are also to blame.
And, according to AmCham, there are other worrying signs. Research and development spending dropped 10% among locally based US companies compared to an average of 3% in the rest of Europe, while the trend in new investments compares unfavourably with other European countries.
AmCham warns that high taxation and employment costs combined with a depressed economy make it very hard to attract further investments in Belgium. Despite the attractiveness of the notional interest legislation that has helped fuel capital increases at many firms, there is concern that it may not be enough to keep them here.
In a panel discussion following the report’s presentation, AmCham members asked the authorities for more simplicity, stability and predictability in everything from public-private partnerships and inward foreign investment measures to taxation and labour costs. As Jean Eylenbosch, Coca-Cola’s VP, said: “Belgium is like a sponge. It absorbs and implements any new tax tried abroad.” While the panel praised the education system that provides an educated workforce and a productivity said to be among the highest in the world, it warned that it was not enough to convince corporate headquarters.
Meanwhile, AmCham is bracing itself for the release in May of its yearly Priorities for a Prosperous Belgium. The document is the basis of the chamber’s lobbying efforts towards authorities to influence policy towards a more business-friendly environment. It is often used by the Belgian employers’ federation as a reference in its negotiations with the government and the unions.
A further step could be made in harnessing all the locally based foreign chambers of commerce in setting a common business platform that would be considered the voice of the international business community in Belgium. AmCham president Scott Beardsley (pictured) believes that Belgium is punching above its weight in the contest to attract foreign investments, but his message to the authorities would certainly pack more power if it represented all this country’s international firms.