Belgium Daily: Economy Stalls, NATO Spy Case, Justice Reform

Belgium sweltered through its hottest day of the week on Wednesday as temperatures reached 35°C, but the heat was matched by a flurry of significant political, economic, and legal developments. The Belgian economy recorded zero growth in the second quarter for the first time since the COVID-19 crisis, a Canadian intern at NATO’s SHAPE headquarters was held on espionage charges, and a Jewish foundation launched a lawsuit against the national railway company NMBS over its role in Holocaust deportations during World War II.

Economy Hits a Wall

The Belgian economy recorded zero growth in the second quarter compared to the first quarter of 2026, according to the National Bank’s flash estimate. This marks the first stagnation since the COVID-19 crisis in the second quarter of 2020. Industry contracted by 0.8% and construction by 0.5%, while the services sector managed slight growth of 0.2%. Year-on-year, the economy grew by 0.5% compared to Q2 2025. The National Bank had previously warned of a slowdown, and economists point to broader European headwinds including elevated energy prices and global trade tensions as contributing factors.

NATO SHAPE Espionage Case Deepens

A Canadian national of Chinese origin who was interning at NATO’s Supreme Headquarters Allied Powers Europe (SHAPE) in Casteau has been placed under pretrial detention on espionage charges. Arrested on July 24 and confirmed for detention by the Council Chamber on July 28, she is suspected of espionage for a third country and participation in a criminal organization. SHAPE’s security services alerted Belgian military intelligence (SGRS), leading to a coordinated operation on July 23 by the PJF of Charleroi with support from the Computer Crime Unit. The case has drawn international attention, exposing what analysts describe as a “delegated-vetting blind spot” within NATO’s security framework.

NMBS Taken to Court Over WWII Deportations

The Nico Gunzburg Foundation has filed a lawsuit against NMBS and the Belgian state demanding compensation for the railway company’s role in the deportation of Jews during World War II. Between 1942 and 1944, NMBS operated 28 deportation trains from Mechelen to Auschwitz, transporting 25,490 Jews and 353 Roma. Only 1,195 survived. The foundation is seeking €1 in provisional damages, with the potential for millions. Lawyer Arthur Flieger said, “They want to wait until the victims and survivors are no longer alive,” criticizing NMBS for failing to deliver on a promised apology announced in May 2025. NMBS blames the Belgian government for the delay, while the Dutch Railways (NS) have already paid similar compensation.

Justice Reform: Drug Barons to Pay for Prison?

Justice Minister Annelies Verlinden (CD&V) has introduced a bill that would allow judges to impose detention fees on convicts of organized crime, drug trafficking, and human trafficking. The government estimates it could generate €5–6 million per year, compared to the approximately €160 per day it costs to detain an individual. However, experts including criminologist Tom Daems (KU Leuven) and the High Council for Justice have criticized the proposal as “symbol politics” and a “stopgap measure,” arguing that existing asset forfeiture tools should be strengthened instead. The bill also reforms the recusal procedure in criminal trials, shortening timelines and imposing fees for unsuccessful motions, a move that the bar association warns could threaten trust in the justice system.

Energy Excise Reform Takes Effect August 1

Belgium’s energy excise reform comes into force on August 1, shifting the tax burden from electricity to fossil fuels. Electricity excise will drop from €50.33 to €46 per MWh this year, eventually reaching €38 by 2029, while gas excise rises from €8.72 to €10.31 per MWh and heating oil from €17.30 to €23 per 1,000 liters. The goal is to encourage electrification by narrowing the price gap between electricity and gas, currently one of the widest in Europe at a ratio of 4.15:1. The impact on most households will be modest, with economist Philippe Defeyt describing the amounts as “ridiculously small” and likely to be “lost in the other variations of the bill.”

Fedasil Asylum Center Delayed in Uccle

A planned 230-bed Fedasil asylum center in Uccle, originally slated to open July 14, has been further delayed after the presiding judge recused herself for medical reasons. A new hearing is scheduled for August 5, with a new judge taking over the case from the beginning. The delay affects 230 future residents who had already packed their belongings in preparation for the move.

Government Waste: 52 Empty Buildings Costing Millions

An investigation by Het Laatste Nieuws revealed that 52 government-owned properties have been empty for over a year, covering 245,000 square meters — the equivalent of 34 football fields. Utility and security costs for these vacant buildings have doubled from €408,000 in 2023 to nearly €800,000 in 2025, with dereliction taxes adding another €1.25 million. Minister Vanessa Matz (Les Engagés) has begun cutting leases and consolidating offices, saving €7.9 million per year by relocating services to the Eurostation complex near Brussels-South station.

In Other News

Temperatures peaked at 35°C, with a youth campfire in Tielt-Winge spiraling out of control. The Belgian Solar Team took the lead in the Electrek American Solar Challenge, while Brassband Bacchus from Lennik won silver at the World Music Contest in Kerkrade. ZOO Planckendael resumed animal petting after a ten-year hiatus with new welfare-first rules. A community-driven plush toy theft game called Plusje went viral in Mol and Balen, connecting residents across two municipalities. Bpost launched same-day redelivery to Bbox parcel machines, and Radiant Color, a Houthalen-based company, is supplying pink firefighting pigment to Southern Europe as orders surge amid the wildfire season.

What to Watch

With the Belgian economy stalling, attention turns to the National Bank’s full quarterly report and potential government stimulus measures. The NATO SHAPE espionage case will continue to unfold in Mons court, while the NMBS lawsuit could set important precedents for corporate liability for historical injustices. The Fedasil Uccle hearing on August 5 will determine whether the asylum center can finally open, and the broader implications of Verlinden’s justice reforms will face scrutiny as they move through parliament.