Luxembourg

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Economics

Economy - overview

This small, stable, high-income economy - benefiting from its proximity to France, Belgium, and Germany - has historically featured solid growth, low inflation, and low unemployment. The industrial sector, initially dominated by steel, has become increasingly diversified to include chemicals, rubber, and other products. Growth in the financial sector, which now accounts for about 28% of GDP, has more than compensated for the decline in steel. Most banks are foreign owned and have extensive foreign dealings, but Luxembourg has lost some of its advantages as a tax haven because of OECD and EU pressure. The economy depends on foreign and cross-border workers for about 60% of its labor force. Luxembourg, like all EU members, suffered from the global economic crisis that began in late 2008, but unemployment has trended below the EU average. Following strong expansion from 2004 to 2007, Luxembourg's economy contracted and 3.7% in 2009, but rebounded 3.2% in 2010. The country continues to enjoy an extraordinarily high standard of living - GDP per capita ranks third in the world, after Liechtenstein and Qatar, and is the highest in the EU. Turmoil in the world financial markets and lower global demand during 2008-09 prompted the government to inject capital into the banking sector and implement stimulus measures to boost the economy. Government stimulus measures and support for the banking sector, however, led to a 5% government budget deficit in 2009. Nevertheless, the deficit was cut to 1.4% in 2010.

GDP (purchasing power parity):

$41.09 billion (2010 est.)

country comparison to the world: 98

$39.74 billion (2009 est.)

$41.25 billion (2008 est.)

note: data are in 2010 US dollars

 

GDP (official exchange rate):

$54.95 billion (2010 est.)

 

GDP - real growth rate:

3.4% (2010 est.)

country comparison to the world: 113

-3.7% (2009 est.)

1.4% (2008 est.)

 

GDP - per capita (PPP):

$82,600 (2010 est.)

country comparison to the world: 3

$80,800 (2009 est.)

$84,900 (2008 est.)

note: data are in 2010 US dollars

 

GDP - composition by sector:

agriculture: 0.4%

industry: 13.6%

services: 86% (2007 est.)

 

Labor force:

205,900

country comparison to the world: 168

note: 125,400 workers commute daily from France, Belgium, and Germany (2010 est.)

 

Labor force - by occupation:

agriculture: 2.2%

industry: 17.2%

services: 80.6% (2007 est.)

 

Unemployment rate:

6% (2010 est.)

country comparison to the world: 55

5.7% (2009 est.)

 

Population below poverty line:

NA%

 

Household income or consumption

by percentage share:

lowest 10%: 3.5%

highest 10%: 23.8% (2000)

 

Distribution of family income - Gini index:

26 (2005)

country comparison to the world: 135

 

Investment (gross fixed):

16.8% of GDP (2010 est.)

country comparison to the world: 152

 

Budget:

revenues: $21.87 billion

expenditures: $22.67 billion (2010 est.)

 

Taxes and other revenues:

39.8% of GDP (2010 est.)

country comparison to the world: 44

 

Budget surplus (+) or deficit (-):

-1.4% of GDP (2010 est.)

country comparison to the world: 63

 

Public debt:

19.7% of GDP (2010 est.)

country comparison to the world: 111

16.5% of GDP (2009 est.)

 

Inflation rate (consumer prices):

2.3% (2010 est.)

country comparison to the world: 71

0.4% (2009 est.)

 

Central bank discount rate:

1.75% (31 December 2010)

country comparison to the world: 110

1.75% (31 December 2009)

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:

2.283% (31 December 2010 est.)

country comparison to the world: 182

2.692% (31 December 2009 est.)

 

Stock of narrow money:

$90.85 billion (31 December 2010 est.)

country comparison to the world: 32

$90.86 billion (31 December 2009 est.)

note: see entry for the European Union for money supply in the euro area; the European Central Bank (ECB) controls monetary policy for the 17 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:

$235.3 billion (31 December 2010 est.)

country comparison to the world: 36

$241.1 billion (31 December 2009 est.)

 

Stock of domestic credit:

$395.1 billion (31 December 2009 est.)

country comparison to the world: 29

$369.6 billion (31 December 2008 est.)

 

Market value of publicly traded shares:

$101.1 billion (31 December 2010)

country comparison to the world: 40

$105.6 billion (31 December 2009)

$66.46 billion (31 December 2008)

 

Agriculture - products:

grapes, barley, oats, potatoes, wheat, fruits; dairy and livestock products

 

Industries:

banking and financial services, iron and steel, information technology, telecommunications, cargo transportation, food processing, chemicals, metal products, engineering, tires, glass, aluminum, tourism

 

Industrial production growth rate:

8% (2010 est.)

country comparison to the world: 45

 

Electricity - production:

2.667 billion kWh (2009 est.)

country comparison to the world: 127

 

Electricity - consumption:

6.453 billion kWh (2008 est.)

country comparison to the world: 104

 

Electricity - exports:

2.604 billion kWh (2009 est.)

 

Electricity - imports:

3.418 billion kWh (2009 est.)

 

Oil - production:

0 bbl/day (2010 est.)

country comparison to the world: 191

 

Oil - consumption:

60,500 bbl/day (2010 est.)

country comparison to the world: 95

 

Oil - exports:

686 bbl/day (2009 est.)

country comparison to the world: 122

 

Oil - imports:

51,930 bbl/day (2009 est.)

country comparison to the world: 88

 

Oil - proved reserves:

0 bbl (1 January 2011 est.)

country comparison to the world: 156

 

Natural gas - production:

0 cu m (2010 est.)

country comparison to the world: 209

 

Natural gas - consumption:

1.366 billion cu m (2010 est.)

country comparison to the world: 86

 

Natural gas - exports:

0 cu m (2010 est.)

country comparison to the world: 134

 

Natural gas - imports:

1.366 billion cu m (2010 est.)

country comparison to the world: 54

 

Natural gas - proved reserves:

0 cu m (1 January 2011 est.)

country comparison to the world: 201

 

Current account balance:

$4.2 billion (2010 est.)

country comparison to the world: 36

$3.577 billion (2009 est.)

 

Exports:

$16.8 billion (2010 est.)

country comparison to the world: 74

$15.53 billion (2009 est.)

 

Exports - commodities:

machinery and equipment, steel products, chemicals, rubber products, glass

 

Exports - partners:

Germany 22.3%, France 15.5%, Belgium 12.1%, UK 9.2%, Italy 7.2%, Netherlands 4.1% (2010)

 

Imports:

$22.08 billion (2010 est.)

country comparison to the world: 68

$19.85 billion (2009 est.)

 

Imports - commodities:

minerals, metals, foodstuffs, quality consumer goods

 

Imports - partners:

Belgium 31.4%, Germany 25.1%, France 11.6%, China 9.2%, Netherlands 5.2% (2010)

 

Reserves of foreign exchange and gold:

$800 million (31 December 2010 est.)

country comparison to the world: 139

$800 million (31 December 2009 est.)

 

Debt - external:

$1.892 trillion (30 June 2010)

country comparison to the world: 11

$2.02 trillion (31 December 2008)

 

Stock of direct foreign investment - at home:

$NA (31 December 2009 est.)

$11.21 billion (31 December 2008 est.)

 

Stock of direct foreign investment - abroad:

$NA

Exchange rates:

euros (EUR) per US dollar -

0.755 (2010)

0.7198 (2009)

0.6827 (2008)

0.7345 (2007)

0.7964 (2006)