Recent figures from the Ministry of Finance confirm, once again, the resilience of the Luxembourg economy. It is clear that Luxembourg has returned to its dynamic economic activity levels.

Better public finances than expected

Minister for Finance Yuriko Backes presents the economic situation of LuxembourgThe increase in tax revenue of 16.3% compared to 2020 includes a catch-up effect after the first year of the pandemic, but the positive trend is confirmed over time. The average increase per year since 2019 is around 5.2%, which is comparable to the annual progression observed historically. The positive evolution is also shown by the continuous fall in the unemployment rate, despite ongoing uncertainty with the pandemic.

Luxembourg continues to remain attractive for companies and investors despite an uncertain international context.

“The figures as of 31 December 2021 confirm the positive evolution of tax revenues observed throughout the year,” comments Minister of Finance Yuriko Backes. “Given that at the same time expenditure has been largely under control, the Central Administration should close the year 2021 with better than expected results.”

S&P Global, Fitch and DBRS Morningstar confirms AAA rating

An additional confirmation of the strength and stability of the Luxembourg economy is the AAA credit rating awarded in early 2022, once again, by S&P Global, Fitch and DBRS Morningstar. The three agencies certified yet again the good financial situation of the country thanks to its balanced and forward-looking budgetary approach and highlighted its great resilience in the face of the shock caused by COVID-19. The government is commended for its effective support to the economy during the health crisis, delivered without jeopardising the sustainability of public finances.

The government is reassured in the pursuit of its economic policy based on sustainable growth for the country and its citizens.

Finance Minister Yuriko Backes comments: “The double confirmation of our ‘AAA’ rating underlines the soundness of the government’s economic and budgetary policy before and during the health crisis. Luxembourg continues to remain attractive for companies and investors despite an uncertain international context,” said Minister Backes. “The government is reassured in the pursuit of its economic policy based on sustainable growth for the country and its citizens.”

Growth back on track

The solidity of the economy is also illustrated by a decrease of GDP limited to -1.8 in 2020, which can be compared with the euro zone average of -6.5%, and a strong growth of +7% in 2021. According to DBRS, the AAA rating also reflects Luxembourg’s robust institutional framework, stable and predictable political environment and strong, well-developed economy. The maintenance of a relatively low level of public debt represents a safety cushion making it possible to attenuate the materialisation of any unforeseen events.

Photo credits: Tristan Schmurr, Ministry of Finance

Read more

Entering the metaverse market


Often considered as the next iteration of the internet, the metaverse is expected to play a key role in the digital transformation of the economy. But is it just hype, or a trend with real substance? We spoke to Arnaud Lambert, Director Digital Transformation, and Sara Bouchon, Director Market Intelligence at Luxinnovation, to find out more.
Read more

Launch of the Humanitarian Innovation Accelerator call for projects


From today on, the call for projects of the Humanitarian Innovation Accelerator (HIA) will be open to national and international applications in order to promote innovative solutions in support of the global humanitarian sector. Applications can be submitted until 1 March 2023.
Read more

“Break down the diversity barriers”


Opening a first European office is a big step for many international companies that do not only need to handle business aspects, but also cultural and linguistical challenges. Toshihiko “Toby” Otsuka, CEO of Rakuten Europe, shares how this Japanese company managed to overcome such barriers when establishing its European headquarters in Luxembourg.
Read more

“Revalidate your assumptions”


Argentine digital health company ViewMind opened its European office in Luxembourg a few years ago. Mark Edwards, CEO, and Matias Shulz, COO of ViewMind, share their insights into key points to keep in mind for international companies that target the European market.
Read more

People and partnerships key to success


In late 2017, San Francisco-based global space-based data, analytics and space services provider Spire opened its Luxembourg office to increase its European footprint. We spoke to John Lusk, COO of Spire Maritime, about what he sees as the main success factors and pitfalls to be avoided for international companies expanding to Europe.
Read more

Resources all news