Belgium became independent from the Netherlands in 1830; it was occupied by Germany during World Wars I and II. The country prospered in the past half century as a modern, technologically advanced European state and member of NATO and the EU. Tensions between the Dutch-speaking Flemings of the north and the French-speaking Walloons of the south have led in recent years to constitutional amendments granting these regions formal recognition and autonomy. Its capital, Brussels, is home to numerous international organizations including the EU and NATO.
This modern, open, and private-enterprise-based economy has capitalized on its central geographic location, highly developed transport network, and diversified industrial and commercial base. Industry is concentrated mainly in the more heavily-populated region of Flanders in the north. With few natural resources, Belgium imports substantial quantities of raw materials and exports a large volume of manufactures, making its economy vulnerable to volatility in world markets. Roughly three-quarters of Belgium's trade is with other EU countries, and Belgium has benefited most from its proximity to Germany. In 2011 Belgian GDP grew by 1.8%, the unemployment rate decreased slightly to 7.2% from 8.3% the previous year, and the government reduced the budget deficit from a peak of 6% of GDP in 2009 to 4.2% in 2011 and 3.3% in 2012. Fourth quarter GDP growth in 2012 was at -0.1%, the third consecutive quarter of negative growth. This brought economic growth for the whole of 2012 to negative 0.2%. It also left Belgium on the brink of a possible recession at the end of 2012. However, at year's end, the government appeared close to meeting its 2012 budget deficit goal of 3% of GDP. Despite the relative improvement in Belgium's budget deficit, public debt hovers around 100% of GDP, a factor that has contributed to investor perceptions that the country is increasingly vulnerable to spillover from the euro-zone crisis. Belgian banks were severely affected by the international financial crisis in 2008 with three major banks receiving capital injections from the government, and the nationalization of the Belgian retail arm of a Franco-Belgian bank.