Belgian government crisis looms as budget talks collapse

Belgian Prime Minister Bart De Wever was set to hand in his resignation on Monday, following late-night coalition talks that ‌failed to reach a compromise on budget cuts, Belgian media reported.

De Wever arrived at the Royal Palace in Brussels on Monday morning for a meeting with Belgian King Philippe. He was widely expected to offer his ‌resignation, after his five-party coalition again failed to agree on next year's budget.

De Wever's office did not ‌immediately respond to a request for comment and the prime minister did not speak to the press as he arrived at the palace. The government has been arguing for months over €10 billion ($11.2 billion) in budget cuts and tax increases De Wever says are ⁠needed to ​keep state finances in ⁠check.

The crisis coincides with heightened stress on financial markets, where interest rates have risen sharply on government bonds of Belgium, France ⁠and other European countries seen to have weak government finances. Belgium's king was not expected to immediately accept the resignation of ​De Wever's government, newspaper De Tijd cited sources as saying, but could instead send De Wever ⁠back for a last push at the negotiating table.

If De Wever's resignation is accepted, the king could ask other parties to form ⁠a ​new coalition, or it could lead to new elections. De Wever has repeatedly warned of an "interest snowball" without budget cuts, where Belgium would need to take on new loans to be able to pay interest ⁠on existing debt.

In months of talks, De Wever's Flemish nationalist N-VA and the liberal MR have not ⁠been able to compromise ⁠with their socialist and centrist coalition partners. The N-VA and MR have pushed for cuts in spending including on healthcare, while their partners demand higher wealth taxes to ‌bring in more ‌resources.

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