The importance of the banking sector has enabled the Grand Duchy of Luxembourg to withstand the Covid-19 crisis more successfully than most European countries. After a slight contraction in GDP in 2020, Allianz Trade, world leader in trade credit insurance and a subsidiary of Allianz, forecasts growth of +3% in 2021 and +3.5% in 2022. These values are above Luxembourg's long-term growth potential of +2.5%.
Growth in the Grand Duchy will continue to exceed the euro area average. The country has developed a strong competitive advantage in financial services over recent decades, making it the second-largest investment fund centre in the world after the United States and the most important private banking centre in the euro area.