Luxembourg’s GDP is expected to grow by 6% in volume over 2021, due to progress in the vaccination programme and stimulus packages, according to National Institute of Statistics and Economic Studies of the Grand Duchy of Luxembourg (STATEC).
Positive Luxembourg economic indicators
The economic indicators available for the first quarter of 2021 are positive. STATEC forecasts a growth in volume of Luxembourg’s GDP of 6% in 2021, followed by +3.5% in 2022. During these two years, the market sector should regain activity and investment, gradually taking over from public spending.
In 2021, the Luxembourg labour market will remain the most dynamic in the euro zone. This very good resilience is partly due to job retention measures introduced by the Luxembourg government, including the extension of short-time working.
The resilience of the Luxembourg economy to the pandemic also showed in government accounts. Revenues fell slightly, by around 1% last year, compared with a -4% average in the euro zone. The good performance of household taxes and social security contributions, as well as the rapid rebound in VAT revenues limited the negative impact. STATEC forecasts government revenue growth of just over 7% per year in 2021 and 2022.
Luxembourg: world’s most resilient economy
With the highest score, the Luxembourg economy ranks first in the world according to 2021 FM Global Resilience Index. This category focuses on political and macroeconomic factors influencing resilience, such as productivity, which Luxembourg ranks first globally.
Considering all factors, the country ranks 3rd most resilient in the world after Denmark and Norway.
The index looks at key business resilience factors, with the aim of helping companies assess the ability of different countries to withstand disruption and, in the event of disruption, to recover strongly.
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