Guaranteed Debt

Flanders’ guaranteed debt slightly increased in 2021. At the end of the year, total guaranteed debt amounted to 12.319 billion euros, including 10.181 billion euros of consolidated guaranteed debt. The main reasons behind that limited increase are:

  • increased guaranteed debt of:
    • Lantis, given the progress of the Oosterweel project (184 million euros)
    • Gigarant NV (133.36 million euros)
    • Social housing (89.65 million euros)
    • Schools of Tomorrow (83.81 million euros)
  • decreased guaranteed debt of:
    • Flemish Social Housing Company (VMSW; 225 million euros)
    • Flemish Housing Fund (VWF; 165 million euros)
    • Flemish Infrastructure Fund for Person-related Matters (VIPA; 136.76 million euros)
Evolution of guaranteed debt (2019-2021; in millions of euros)
2019 2020 2021
Guarantees to (local) authorities 207.81 206.59 212.69
Guarantees covered by assets 11,103.59 10,789.92 10,632.58
Economic guarantees 1,043.28 1,299.13 1,474.11
TOTAL 12,354.68 12,295.64 12,319.38
What is guaranteed debt?

Guaranteed debt concerns debts of companies or institutions guaranteed by the Flemish government. It is not considered actual government debt. The debt will only constitute a burden for the government if the debtor is unable to meet its debt obligations.

Which entities received historically most guarantees?
Is guaranteed debt included in the consolidated debt?

In 2021, 10.181 billion euros of Flanders’ guaranteed debt was already included in the consolidated debt. That means that only a limited part of the total guaranteed debt (2.138 billion euros) can be considered guaranteed debt in the narrow sense. In 2021, the non-consolidated guaranteed debt increased by 152.53 million euros as a result of the prolonged coronavirus crisis, while the consolidated guaranteed debt decreased to a lesser extent, by 128.79 million euros.

Evolution of consolidated and non-consolidated guaranteed debt (2019-2021; in millions of euros)

2019 2020 2021
Total consolidated guaranteed debt 10,594.81 10,309.78 10,180.99
Total non-consolidated guaranteed debt 1,759.87 1,985.86 2,138.39
Total guaranteed debt 12,354.68 12,295.64 12,319.38
How does Flanders manage the risk of guaranteed debt?

In 2021, enforcements accounted for only 0.10% of the total outstanding guarantees. It mainly concerned PMV/z Guarantees, where 11.89 million euros of guarantees had been claimed. For most guaranteed entities the sum of the received recoveries and guarantee fees was also higher than the total enforced amount. Consequently, the overall balance was strongly positive and amounted to 10 million euros in 2021. While in previous years the cost of guarantee provision was limited, it even generated money in 2020 and 2021.

The cost of guarantees (2020-2021; in millions of euros)

Fees Enforcements Recoveries Balance
2020 2021 2020 2021 2020 2021 2020 2021
TOTAL 12.02 14.71 13.04 12.16 7.03 7.44 6.01 10.00

The government budget however does contain an annual provision for expected enforcements, based on standardised provision of guarantees.

In 2021, almost all enforcements were related to economic guarantees. Those guarantees accounted for only 11.97% of the total Flemish guaranteed debt. Most of Flanders’ guaranteed debt (86.31%) is covered by assets. Therefore the risk is rather limited.

Want to know more about Flanders’ guaranteed debt? Read every detail in the most recent Cash, Debt and Guarantee Management Report.