Belgium plans to form government this week

BELGIUM may have a government this week, the country’s chief negotiator in charge of forming a cabinet Elio Di Rupo said yesterday, after political parties clinched a deal on the 2012 budget under pressure from rising borrowing costs.

The budget agreement was seen as the last major obstacle to forming a government among six Belgian parties and came hours after ratings agency Standard & Poor’s had downgraded Belgium’s credit to AA from AA+, pressing the country to act.

“We hope to be able to do it (form a government) during next week. We still have a few areas on which we need to work and we believe that we will do it with the shortest delay possible,” Elio Di Rupo, who is likely to be the next prime minister, told a news conference.

Belgium has set a modern-day record for being without a formal government. It has been about 18 months since its elections, which is one reason for its rating downgrade. nment at a time of bond market turmoil was one of the reasons Belgium was downgraded.