Belgium as a trading nation

With few natural resources of its own, Belgium has profited from its location at the center of a highly industrialized area in Europe with several port cities that have made it one of the world’s largest trading nations.

The Country

Belgium is located in Western Europe and borders France, the Netherlands, Germany, Luxembourg, and the North Sea. Along with the Netherlands and Luxembourg, Belgium has been historically part of the “Low Countries.” In some economic circles, these small countries are still connected and reported together, as they have formed a sort of union referred to as Benelux nations. Belgium is a small country, about the size of the state of Maryland, but it boasts 66.5 kilometers of coastline. It is centrally located, at the heart of the European Union, with the majority of European capitals within 1,000 kilometers of Brussels, the Belgian capital city, which is the headquarters of the European Union and North Atlantic Treaty Organization (NATO).

Belgium’s geography is varied for a small country, with flat coastal plains in the northwest near the North Sea that stretch into the rugged mountains of the Ardennes forest in the southeast near its borders with France. By 2023, Belgium’s gross domestic product (GDP) was $752 billion, making it one of the largest in the world. Services account for about 71 percent of Belgium’s GDP, a surprisingly high number somewhat related to its place as the headquarters of the European Union, NATO, and other major organizations based in Europe. Its workforce is highly educated and multilingual. The capital, Brussels, is home to more than two million people and more than fifty thousand businesses. On its own, Brussels produces about 20 percent of Belgium’s GDP.

Although Belgium has few natural resources of its own, its location at the center of a highly industrialized area in Europe with several port cities means that it functions as a trading center for many goods. Its paucity of natural resources was supplemented historically by its colonial possessions in the Belgian Congo (now Democratic Republic of the Congo), which provided raw materials such as cobalt, copper, diamonds, cacao, and zinc. Belgium’s economy depends heavily on importing raw materials or other goods that are finished or further processed and then exported. Historically, its most prominent natural resource was coal, but in 1992, its coal mines closed permanently, and, unless the price of coal increases to the point of making it worthwhile to extract the deeply embedded seams, the mines are unlikely to reopen. Belgium is one of the world’s largest trading nations with about three-quarters of its trading done with its European Union neighbors, particularly Germany, the Netherlands, France, and the United Kingdom. Because of Belgium’s economic reliance on trading and processing rough goods, its economy is dependent on world markets and their stability to a much higher degree than countries with their own natural resources and independent economies.

Coal

Historically, Belgium was a major producer and exporter of coal. Coal in Belgian coal mines, especially in the Kempen and Sambre-Meuse Valley, was easy to extract, and mining was a booming business. In the heyday of its coal-mining industry, Belgium imported workers from other countries to keep the coal mines operating. However, after the easily accessible coal had been extracted and the seams of coal ran farther underground and into harder materials, continuing to extract coal from these mines became economically inefficient. Between 1957 and 1992, Belgium shut down more than 120 coal mines, and unless the price of coal rises to the point of making this coal economically feasible to extract and export, it is unlikely that these mines will return to operation.

Construction Materials

Belgium is a source of construction materials such as silica sand, chalk, stone, and carbonates. Chalk and limestone are mined in the regions surrounding Tournai, Mons, and Liège, where there is a cement industry of some significance. The glass manufacturing industry is also supported by sands from the Kempenland area. Pottery products and bricks are made from clays from the Borinage region. Quarries also produce stones such as specialty marble, dolomite, granite, and sandstone.

Diamonds

Belgium is the leading country in the diamond trading market. Its port city of Antwerp is the diamond capital of the world, housing the leading diamond market in the world. Rough diamonds are imported and then processed into finished diamonds in Antwerp, where they are then traded and exported. This city is also the leading diamond cutting area of the world, where, the traditional story says, the first diamond was cut in 1476. The diamond cutting and trading center called “the Diamond Quarter” near Central Station (the train station near the port) has been a growing, thriving entity since the sixteenth century. Though the diamond processing arm of the trade is diminishing, diamond exports are still a major part of Belgium's economy. Belgium was a leading exporter of diamonds in the world as of 2023. In 2022, Belgium's largest market for polished diamonds was India, followed by the United Arab Emirates and the United States.

Sugar

Belgium is also a major producer of sugar from sugar beets. This industry began in Belgium in 1807 when the British started a blockade of cane sugar from the Caribbean during the Napoleonic Wars. With cane sugar unavailable, beet sugar began to be the sugar of choice throughout Napoleonic Europe. The sugar production capital of Belgium is Tienen, which hosts a large sugar-beet processing factory that was founded in 1836. This factory and related sugar production facilities owned by the Raffinerie Tirlemontoise Group employ about 650 people. This company owns three other Belgian sugar factories, in Brugelette, Genappe, and Wanze.

Beer

Monks in Belgium began brewing beer sometime during the Middle Ages. There are more than one hundred breweries scattered throughout Belgium, with about eight hundred standard types of beer produced. These range from light through dark types of beer; Belgians brew and export nearly every type of beer possible. Often, each type of beer is served in its own distinctive glass, which is said to enhance the flavor of that particular type of beer. Though Belgium is famous for many kinds of beer, it is possibly most famous for lambic beer, which is made in an ancient brewing style. This style depends on a spontaneous natural fermentation process after ingredients are exposed to the wild yeasts and bacteria native to the Senne Valley, located south of Brussels. This unusual fermentation process produces a drink that is naturally effervescent or sparkling, which is then aged, up to two or three years, to improve its taste. Much like champagne (only produced in a certain region in France) or Madeira (only produced on a certain island owned by Portugal), the title of “lambic beer” can only be given to this type of beer brewed in the small Pajottenland region of Belgium. More than half the beer brewed in Belgium is exported, mostly to Canada, France, Germany, Italy, Spain, the United States, and the United Kingdom.

Chocolate

During the seventeenth century, when the Low Countries were ruled by Spain, Spanish conquistadores brought cacao beans back from the New World to the region that is now Belgium. By 1840, the Berwaerts Company had begun to sell Belgian chocolates that were quite popular. However, not until the nineteenth century, when King Leopold II colonized the Belgian Congo in 1885 and discovered cacao tree fields there, did Belgian chocolatiers begin to manufacture Belgian chocolates on a large scale. At the beginning of the 1900s, there were at least fifty chocolate makers in Belgium. In 1912, Jean Neuhaus created a process for making a chocolate shell that could be filled with any number of fillings, something he called a “praline,” making Belgian chocolates even more popular. Belgium produces more than 270,000 metric tons of chocolate each year, has more than two thousand chocolate shops throughout the country, and hosts about three hundred different chocolate companies. Many of the original chocolate-making companies—such as Godiva, Leonidas, Neuhaus, and Nirvana—are still in operation today, and many of them still make chocolates by hand, using original equipment, high-quality ingredients, and Old World manufacturing techniques. Chocolate shops in Belgium offer tastings, much like wineries, and host chocolate festivals, workshops, tours, and demonstrations. There is a museum dedicated to chocolate, the Musée du Cacao et du Chocolat, near the Grand Place, the town square in Brussels. Belgium’s European Union neighbors (particularly France, Germany, and the United Kingdom) are the biggest importers of Belgian chocolate.

Pharmaceuticals

Belgium has become a world leader in the pharmaceutical industry, employing nearly thirty thousand people and accounting for about 10 percent of all Belgian exports. Major pharmaceutical companies headquartered in Belgium include UCB, Solvay, Janssen Pharmaceutica, Omega Pharma, Oystershell NV, and Recherche et Industries Thérapeutiques. Private investment in research and development in the pharmaceutical industry is at about 40 percent, which is nearly twice the average of other European companies. The pharmaceutical industry is also heavily supported by the Belgian government, which offers tax incentives for pharmaceutical research and development. In 2023, the United States imported about $6.74 billion in medicinal, dental, and pharmaceutical products from Belgium.

Textiles

Since the thirteenth century, Belgium has been known as the home of master textile producers. The famous Unicorn Tapestries or “The Hunt of the Unicorn” series on display at The Cloisters, a part of the Metropolitan Museum of Art in New York, is thought to have been woven in Brussels sometime around 1495-1505 (when that area was still part of the Netherlands). The Flanders, or Flemish, region of Belgium is still home to many lace-making artists, particularly in the area of Bruges, which is the home of bobbin lace; however, lace is also still produced in Brussels and Mechelen. This industry can be traced back to the fifteenth century, when Charles V decreed that lace making was to be taught in the schools and convents of the Belgian provinces to provide girls with a source of income, as lace was popular on collars and cuffs for clothing of both sexes at that time. Lace is still produced in Belgium by lace artisans in their homes, one piece at a time, and, thus, is a source of artistic lace rather than high-production lace. There is even a museum dedicated solely to lace, the Musée du Costume et de la Dentelle, located near the Grand Place. Other textile production, including cotton, linen, wool, and synthetic fibers, is concentrated in Ghent, Kortrijk, Tournai, and Verviers, where carpets and blankets are manufactured.

Other Resources

As mentioned above, Belgium has few natural resources, and its economy depends on importing raw materials, processing those materials, manufacturing, and exporting a finished product. However, in addition to sugar processing, there are a few agricultural resources grown and exported by Belgian farmers. These include fruits, vegetables, grains (wheat, oats, rye, barley, and flax), tobacco, beef, veal, pork, and milk.

Other industries in which Belgian workers are involved in processing imported goods that are then exported are motor vehicles and other metal products, scientific instruments, chemicals (fertilizers, dyes, plastics), glass, petroleum, textiles, electronics, and processed foods and beverages, such as the beer and chocolate described above.

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