R a record 588 day wait, Belgium at last has a new Prime Minister – Socialist leader Elio Di Rupo.
The Francophone leader heads a six-party coalition and faces major economic and social challenges.
Europe’s sovereign debt crisis appears to have spread to the formerly-safe core nation, as 10-year bond yields hit record highs of 5.875 per cent on 25 November, though they have since declined.
The government has debts of almost 100 per cent of GDP, and was downgraded by ratings agency Standard and Poor’s last month.
Part of the coalition agreement is to cut the budget deficit to 2.8 per cent of GDP in 2012,
Predecessor Yves Leterme’s government fell after the Flemish liberal party withdrew from his five-party coalition as a result of a row over election boundaries around Brussels.
Flemish and French-speaking parties disagree frequently, and the threat of disintegration hangs over the country – another core challenge for Di Rupo to manage.