A mild recession in 2023
AA1
LOW RISK for enterprise
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Economic risk
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Business environment risk
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Political risk
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Commercial risk
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Financing risk
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Economic risk
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Business environment risk
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Political risk
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Commercial risk
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Financing risk
Updated in October 2022.
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GDP | USD87bn (World ranking 67, World Bank 2021) |
Population | 0.6mn (World ranking 166, World Bank 2021) |
Form of state | Constitutional Monarchy |
Head of government | Xavier BETTEL (Democratic Party, Coalition) |
Next elections | 2023, Legislative |

- Strong financial hub with a solid banking system and the second largest investment fund industry in the world
- Business-friendly environment with transparent and robust institutions and modern infrastructure, facilitating easy access for FDI
- Competitive tax regime favorable for foreign investors and the financial sector
- Strong reputation as a sophisticated financial regulator state
- Very low public debt and fiscal balance in surplus
- High productivity levels and a well-educated, multilingual workforce

- Potential vulnerabilities considering the structure of the financial system and the high dependency of the economy on the banking sector
- Highest corporate debt stock in the Eurozone (320% of GDP)
- Small open economy (export and import volumes are twice the size of GDP)
- Intense dependence on cross-border workers and high cost of labor
- Substantial room for improvement regarding access to post-secondary education
Trade structure by destination/origin
(% of total, 2021)
Exports | Rank | Imports |
---|---|---|
Germany
24.2%
![]() |
1 |
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France
15.9%
![]() |
2 |
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Belgium
6.8%
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3 |
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Netherlands
6.8%
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4 |
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Italy
4.3%
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5 |
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Trade structure by product
(% of total, 2021)
Exports | Rank | Imports |
---|---|---|
Iron and steel
17.1%
|
1 |
12.0%
Road vehicles
|
Road vehicles
7.0%
|
2 |
6.0%
Petroleum, petroleum products and related materials
|
Non-ferrous metals
6.2%
|
3 |
5.0%
Metalliferous ores and metal scrap
|
Other industrial machinery and parts
6.2%
|
4 |
3.7%
Electrical machinery, apparatus and appliances, n.e.s.
|
Miscellaneous manufactured articles, n.e.s.
5.3%
|
5 |
3.6%
Miscellaneous manufactured articles, n.e.s.
|
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