Innovation in Creative sme’s in Flanders: a case Study Based Analysis ∗

2 Brief Report on the Belgian SME Sector 
Although our research focuses on the Flemish creative sector, a more general introduction into the 
Belgian SME-sector is required. Belgium is a federal state, divided into three communities (Flemish, 
French and German speaking) and three regions (Flanders, Wallonia and the Brussels Capital Area), 
each with different governmental responsibilities and organizational structures. While economic policy 
in general falls under the jurisdiction of the federal government, innovation policy is a 
defederalized/regionalized matter.
As can be seen in table 1, economic growth in Belgium has surpassed the euro zone average since 
2002.The general government deficit (surplus) also tends to be stable, with the exception of 2004, and is 
consistently lower than the average for the Euro zone. On the other hand, Belgium’s public debt remains 
high compared to the EU average.
Table 1 Belgium's Macro-Economic Performance 
2000 2001
2002
2003
2004
2005 2006
Real GDP growth (%) 
Belgium 3.7 0.8
1.5
1.0
3.0
1.7 2.8
Euro 
zone 3.8 1.9
0.9
0.8
2.0
1.5 2.8
Net capacity (+) or net financing needs (-) of governments (% of GSD) 
Belgium 0.1 0.6
0
0
0
-2.3 0.4
Euro zone 
0.1 
-1.8
-2.5
-3.1
-2.8
-2.5 
-1.5
Gross government debt – public authorities (Maastricht definition in % of GDP) 
Belgium 107.8 106.5
103.4
98.6
94.2
92.2 88.2
Euro 
zone 68.7 68.3
68.1
69.3
69.7
70.5 68.8
Source: based on Eurostat data (2008) 
In what follows, we will briefly characterize the Belgian SME environment, using data 
obtained from Eurostat. In the figures and tables below, all data are summarized by size class using 
the European SME definition
1
.
Historically, Belgium has always perceived itself as an SME oriented economy. This claim is 
confirmed in table 2, which shows that in 2005; 99.77 percent of all Belgian firms were micro, small or 
medium-sized. In fact, as column 1 in table 2 shows, more than 92 percent of all enterprises are micro 
companies, employing less than ten employees. Within a European context, the Belgian profile is 
comparable to that of the Euro zone
2
. On average, every Euro zone member has more than 99.50 percent 
SMEs. Compared to Belgium, only Italy, Sweden, Portugal and Spain have a slightly higher SME-ratio.