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Luxembourg Economy Profile 2019

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Economy - overview

This small, stable, high-income economy has historically featured solid growth, low inflation, and low unemployment. Luxembourg, the only Grand Duchy in the world, is a landlocked country in northwestern Europe surrounded by Belgium, France, and Germany. Despite its small landmass and small population, Luxembourg is the fifth-wealthiest country in the world when measured on a gross domestic product (PPP) per capita basis. Luxembourg has one of the highest current account surpluses as a share of GDP in the euro zone, and it maintains a healthy budgetary position, with a 2017 surplus of 0.5% of GDP, and the lowest public debt level in the region.

Since 2002, Luxembourg’s government has proactively implemented policies and programs to support economic diversification and to attract foreign direct investment. The government focused on key innovative industries that showed promise for supporting economic growth: logistics, information and communications technology (ICT); health technologies, including biotechnology and biomedical research; clean energy technologies, and more recently, space technology and financial services technologies. The economy has evolved and flourished, posting strong GDP growth of 3.4% in 2017, far outpacing the European average of 1.8%.

Luxembourg remains a financial powerhouse – the financial sector accounts for more than 35% of GDP - because of the exponential growth of the investment fund sector through the launch and development of cross-border funds (UCITS) in the 1990s. Luxembourg is the world’s second-largest investment fund asset domicile, after the US, with $4 trillion of assets in custody in financial institutions.

Luxembourg has lost some of its advantage as a favorable tax location because of OECD and EU pressure, as well as the "LuxLeaks" scandal, which revealed advantageous tax treatments offered to foreign corporations. In 2015, the government’s compliance with EU requirements to implement automatic exchange of tax information on savings accounts - thus ending banking secrecy - has constricted banking activity. Likewise, changes to the way EU members collect taxes from e-commerce has cut Luxembourg’s sales tax revenues, requiring the government to raise additional levies and to reduce some direct social benefits as part of the tax reform package of 2017. The tax reform package also included reductions in the corporate tax rate and increases in deductions for families, both intended to increase purchasing power and increase competitiveness.

GDP (purchasing power parity)
$62.11 billion (2017 est.)
$60.71 billion (2016 est.)
$58.9 billion (2015 est.)

note: data are in 2017 dollars

GDP (official exchange rate)
$62.53 billion (2017 est.)
GDP - real growth rate
2.3% (2017 est.)
3.1% (2016 est.)
2.9% (2015 est.)
GDP - per capita (PPP)
$105,100 (2017 est.)
$105,400 (2016 est.)
$104,600 (2015 est.)

note: data are in 2017 dollars

Gross national saving
22.3% of GDP (2017 est.)
23% of GDP (2016 est.)
23.2% of GDP (2015 est.)
GDP - composition, by end use
household consumption: 30.2% (2017 est.)
government consumption: 16.5% (2017 est.)
investment in fixed capital: 16.2% (2017 est.)
investment in inventories: 1.1% (2017 est.)
exports of goods and services: 230% (2017 est.)
imports of goods and services: -194% (2017 est.)
GDP - composition by sector
agriculture: 0.3% (2017 est.)
industry: 12.8% (2017 est.)
services: 86.9% (2017 est.)
Population below poverty line
Labor force
282,800 (2017 est.)

note: data exclude foreign workers; in addition to the figure for domestic labor force, about 150,000 workers commute daily from France, Belgium, and Germany

Labor force - by occupation
agriculture: 1.1%
industry: 20%
services: 78.9% (2013 est.)
Unemployment rate
5.8% (2017 est.)
6.3% (2016 est.)
Unemployment, youth ages 15-24
total: 15.4%
male: 17.2%
female: 13.2% (2017 est.)
Household income or consumption by percentage share
lowest 10%: 3.5%
highest 10%: 23.8% (2000)
Distribution of family income - Gini index
30.4 (2013 est.)
26 (2005 est.)
revenues: 27.75 billion (2017 est.)
expenditures: 26.8 billion (2017 est.)
Taxes and other revenues
44.4% (of GDP) (2017 est.)
Budget surplus (+) or deficit (-)
1.5% (of GDP) (2017 est.)
Public debt
23% of GDP (2017 est.)
20.8% of GDP (2016 est.)

note: data cover general government debt and include debt instruments issued (or owned) by government entities other than the treasury; the data include treasury debt held by foreign entities; the data include debt issued by subnational entities, as well as intragovernmental debt; intragovernmental debt consists of treasury borrowings from surpluses in the social funds, such as for retirement, medical care, and unemployment; debt instruments for the social funds are not sold at public auctions

Inflation rate (consumer prices)
2.1% (2017 est.)
0% (2016 est.)
Central bank discount rate
0% (31 December 2017)
0% (31 December 2010)

note: this is the European Central Bank's rate on the marginal lending facility, which offers overnight credit to banks in the euro area

Commercial bank prime lending rate
1.9% (31 December 2017 est.)
1.98% (31 December 2016 est.)
Stock of narrow money
$275.6 billion (31 December 2017 est.)
$229.2 billion (31 December 2016 est.)

note: see entry for the EU for money supply for the entire euro area; the European Central Bank (ECB) controls monetary policy for the 18 members of the Economic and Monetary Union (EMU); individual members of the EMU do not control the quantity of money circulating within their own borders

Stock of broad money
$275.6 billion (31 December 2017 est.)
$229.2 billion (31 December 2016 est.)
Stock of domestic credit
$128.5 billion (31 December 2017 est.)
$109.9 billion (31 December 2016 est.)
Market value of publicly traded shares
$47.13 billion (31 December 2015 est.)
$63.17 billion (31 December 2014 est.)
$78.64 billion (31 December 2013 est.)
Agriculture - products
grapes, barley, oats, potatoes, wheat, fruits; dairy and livestock products
banking and financial services, construction, real estate services, iron, metals, and steel, information technology, telecommunications, cargo transportation and logistics, chemicals, engineering, tires, glass, aluminum, tourism, biotechnology
Industrial production growth rate
1.9% (2017 est.)
Current Account Balance
$3.112 billion (2017 est.)
$2.988 billion (2016 est.)
$15.99 billion (2017 est.)
$16.37 billion (2016 est.)
Exports - commodities
machinery and equipment, steel products, chemicals, rubber products, glass
Exports - partners
Germany 25.6%, Belgium 17.6%, France 14%, Netherlands 5.1%, Italy 4.1%, UK 4.1% (2017)
$20.66 billion (2017 est.)
$20.41 billion (2016 est.)
Imports - commodities
commercial aircraft, minerals, chemicals, metals, foodstuffs, luxury consumer goods
Imports - partners
Belgium 32%, Germany 24.9%, France 11.1%, US 5.7%, Netherlands 4.9% (2017)
Reserves of foreign exchange and gold
$878 million (31 December 2017 est.)
$974 million (31 December 2016 est.)
Debt - external
$3.781 trillion (31 March 2016 est.)
$3.806 trillion (31 March 2015 est.)
Stock of direct foreign investment - at home
$11.21 billion (31 December 2008 est.)
Stock of direct foreign investment - abroad


Exchange rates
euros (EUR) per US dollar -
0.885 (2017 est.)
0.903 (2016 est.)
0.9214 (2015 est.)
0.885 (2014 est.)
0.7634 (2013 est.)
Fiscal year
calendar year

Source: CIA World Factbook
This page was last updated on December 7, 2019

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