The Prosperity of Trade Relations
The constitution of Belgium dates from the year 1831. This made them one of the oldest constitutions in effect today, together with that of the United States. It has royal kingdoms with the traditional successions exclusively reserved to the male line.
Belgium's economy is extremely open and fully integrated with the economies of surrounding countries. The few opportunities for natural resources as well as the very small domestic markets led to the need to have the United States support them in their international trade. Before, foreign trade was somehow secluded to the members of the Belgium Luxembourg Economic Union (BLEU). This paved the way for Belgium to at least be recognized in world trade. Brussels, its key city, has become Europe's financial center, thus contributing largely to the Belgian economy.
In the year 1993, Belgium found itself soaked in debt thus hindering their ability to trade in the world scene. They were lead to a very serious loan scenario and the deficit was too hard to handle on their own. The World Bank have helped them rollback but the European economy seem to be bothered as well thus, extending to problems on unemployment and the volume of their trade significantly reduced.
United States was just behind to support this global trade partner. Belgium had considered the United States as its 5th partner with regards to trade while the US ranked the former as its 18th world trade comrade. They have evidenced their relations with exports and imports of various goods from chemical products, machinery and equipment, minerals, metals, textiles and the very basic food products. They have increased their business capacities through time and have never left any of the other party behind. It was such an entire support system that worked well for the benefit of the trading partners.
US-Belgium Major Exports and Imports
The felt need to stand side-by-side was seen in both US and Belgium. They wanted their products to expand by means of importing and exporting in both ways. They have strengthened the depth of their friendship with all their products considered in the trading scene. Their financial statures in the world were improved due to their perseverance of helping each other.
With the continued growth of the imports and exports, they have stretched their friendship to more than just alliance. Belgian's prime commodities entering the United States and other countries include food products, machinery and equipment, chemicals, diamonds and other precious metals. The United States on the other hand exports pharmaceutical needs, transportation equipment and oil products. For the year 2007, the leading products in their trade included the following:
Since 2005, the commodities which have consistently soared in terms of sales in both the economies of the United States and Belgium have been tracked to the following:
- Belgium's exports to US. Figures for 2007 shows that the U.S ranked 5th among the destination countries for Belgium's prime commodities with an average percentage of 5.6% growth. The products included in the top list are chemical products (53.1%), precious metals, machinery and equipment, transport equipment, minerals, metals, food products, synthetic materials, optical instruments and textiles. The last manufactured goods garnered a 1.1% growth for the year 2007 alone.
- Belgium's imports from US. The numerical information for 2007 showed that Belgium was the 12th destination among countries having international trade relations with the US. Eight products were seen topping the ranks with chemical products earning the highest point with a 36% increase. It was followed by machinery and equipment, synthetic products, optical instruments, transport equipment, minerals, precious stones and minerals, metals and the last of the top 8 position goes to plant products with an increase of 1.8%.
The Treaty on Income Tax Impositions
- Exports of US to Belgium. Pearls, precious and semi-precious stones have topped the list of the exported products to Belgium. It was followed by other items such as, organo-inorganic and heterocyclic compounds, medicaments, medicinal products, plastics, medical instrument and appliances, miscellaneous chemical products, civil engineers and contractors' plant and equipment, carboxylic acids halides and derivatives, and internal combustion piston engines.
- Imports of US to Belgium. The top 10 commodities in terms of sales which grew through time from the imports of the US to its trading partner Belgium are pearls, precious and semi-precious stones followed by oil (excluding crude), motor vehicles, organo-inorganic and heterocyclic compounds, special transactions, medicaments, medicinal products, civil engineers and contractors' plant and equipment, photographic and cinematographic supplies and veneers, plywood and particle board.
It is a known fact that each country has several pertinent issues that govern income taxation. Sometimes, it causes conflicts on governance and tax rules. In order to solve this scenario between the United States and Belgium, a proposed Income Tax Treaty was formulated. A joint committee on taxation studied the proposals. In order to understand briefly what this treaty has to say, let us take note of the following:
· Its principal purpose is to eliminate double taxation in both countries. The burden on foreign trade is the fact that the two-to-tango and symbiotic relationships could be forgotten. Income taxes are collected in order for one's economy to prosper. However, with lapses on the income reporting on both sides of these countries, there might be possibilities that one will tax the already levied commodities and the other does the same.
Some Disparities on Trade
- It promotes close economic relations for US and Belgium. This is never secondary in trade relations. Just like professional relationships, the camaraderie built by these two nations need to be preserved for a continuous prospering alliance. It is but proper to put a special bond that will benefit both parties. There should always be transparency in their economic systems and all flaws should never be concealed.
- There is a need to eliminate all barriers to trade. Boundaries should never be neglected in order for both economies to prosper. This is a basic rule that governs global business. There is a need to be responsible for anything that could cause a block in the exchange of both countries.
Aside from the income tax aspect of the trade, other issues may come in. Accounting principles could affect the statistics of each country involved. There is a necessity to at least understand what causes the conflict between the United States and Belgium so that all may end well. Let us discuss the possibilities of addressing the disparities on trade on a per subject basis.
- On Income Taxation. Disputes on income taxation relatively happen in all economic systems. It is because there are several rules of each land that have to be followed in order to remain firm in their standing in the world. With strong trading partners such as Belgium and US, it is but proper to settle this immediately. The proposed agreement on tax impositions probably is the best testing ground to address the irregularities. It did not mainly focus on business taxes but rather expanded it to gains, royalties, dividends, tax liabilities, employment income, entertainers and sportsmen as well as pensions, social security, alimony, child support and annuities.
- On Accounting Principles. The United States General Accounting Office has updated their records to view some discrepancies with some accounting principles affecting its trade partners. An important aspect that needs priority is the fact that there should be willingness to adapt to International Financial Reporting Standards (IFRS). This necessity could be tracked to the reality that there should be only one governing principle on the trade to be able to handle the conflicts on only one point of view. The more the accounting principles adapted, the greater the confusion created between the two. This does not mean that Belgium should eliminate its accounting principles entirely. What is needed is to at least conform to Generally Acceptable Accounting Principles of the US.
The changes in times may affect the positioning of world trade partners. For foreign trade between Belgium and US, it is essential to take care of what they have already started. They have built a strong foundation and the only way to continue is to strengthen what they have already built and say no to jealous associations that could break the conspiracy between them. There is no guarantee about what the future brings, but at least, they could protect each other in ways that no other people or groups could falter.
One good way that started to make the bond grow is presented in the International Freedom Report of 2008 which have tackled religious issues. The United States dealt with the religious platform of Belgium. They found it good enough to grant the wish of rejecting racial discriminations as well as promoting religious freedom in the area. The US Religious Demography shows a lot of religions inhabiting the land and because of this, impartiality was totally eliminated.
The growth of trade between the two countries is deemed to be flourishing. What matters now is to at least follow the rules, give way for better opportunities, trigger economic stabilization and to become one in all areas of society. The United States and Belgium should go beyond the friendship which began in their constitutional establishment.