BELGIUM: AUTOMOBILE SUBSIDY PROGRAMS

UNCLAS BRUSSELS 000363 SIPDIS STATE FOR EEB/TPP/MTAA BRIAN NAFZIGER STATE PASS USTR ROY MALMROSE, LESLIE YANG COMMERCE FOR 4212/ITA/MAC/EUR/OECA/WNE/JLEVINE E.O. 12958: N/A TAGS: ECON EFIN ETRD PREL WTO SUBJECT: BELGIUM: AUTOMOBILE SUBSIDY PROGRAMS REF: STATE 4753 ¶1. Post has found no publicly-available information on actual or proposed federal government subsidies to the automobile industry in Belgium. While the federal government does allow special tax treatment for overtime that has benefited the automotive sector, the arrangement is not specific or limited to the automotive sector. ¶2. The regional government of Flanders, however, has in recent years given training subsidies to automakers as a way of supporting plants located in the region. The Flemish Government initially paid up to 20 percent of retraining costs (subsidy amounts in parentheses) for Volvo (estimated 6 million euro),Ford (12.8 million euro),Opel (13 million euro) and Audi Brussels (14 million euro). The European Commission, however, ruled sometime in 2006 that the Flemish subsidies were too generous and limited them to 10 percent. ¶3. In the context of protecting the Antwerp Opel plant whose closure by GM Europe has been rumored in recent weeks, the Flemish government has indicated a willingness to provide an undetermined amount of government guarantees. BUSH .