Luxembourg Economy: Main Sectors and GDP in 2021
Luxembourg Economy: Main Sectors and GDP in 2021, is one of the smallest countries in the world that is located in northwestern Europe. This country is bordered by France and Germany in the south and northeast and east. Meanwhile, on the west and north, it is bordered by Belgium. Luxembourg is also well-known as the “Green Heart of Europe”.
Regarding the economy, Luxembourg has the highest GDP per capita in the world. In 2013, Luxembourg’s GDP was $60.54 billion and has to continue to increase in 2021 which becomes $70.41 billion.
Many people also asked why Luxembourg has a high GDP. It is because Luxembourg has low taxes, government incentives as well as investment, and stable workplaces. Luxembourg also has a small population that results in high GDP per capita in the world.
Furthermore, the Luxembourg economy is highly dependent on steel, agriculture, banking, and tourism sectors. Let’s see the explanation below to see how those sectors contributed mostly toward the Luxembourg economy.
Steel is one of the most prominent sectors in Luxembourg. The beginning of the steel industry history is in 1876 when English metallurgy was introduced. Furthermore, it resulted in the founding of Arbed Company, the first steel industry in Luxembourg, in 1911.
The company then began to reconstruct its industry and government ownership in early 1974. Then, since the facilities are more modernized, the company began to cut off the employment and portion of the company’s debt, which makes the company gain more profit. Arbed had the highest productivity in the world at that time.
Furthermore, in 2001, the Arbed becomes Arcelor through its merger with Aceralia and Usinor. Moreover, the Arcelor then was taken over by Mittal Steel in 2006 and becomes Arcelor-Mittal which is the largest steel company in the world.
Luxembourg has a small but highly productive agricultural sector. This agricultural sector employs about 1-3% of the workforce in Luxembourg. Luxembourgers mainly produce meat and dairy.
Luxembourg also exports its dry white wine products to several countries such as France, Germany, and Belgium. This dry white wine is produced in vineyards in the Moselle Valley. Each year, this vineyard can produce as much as 15 million liters of dry white wine.
The largest sector in Luxembourg’s economy is banking. In 2019, Luxembourg was ranked 25th as the world’s competitive financial center. Meanwhile, for the position of the competitive financial center in Europe, Luxembourg managed to occupy the 3rd position after London and Zürich. In 2009, Luxembourg had more than 27,000 employees with a total of 157 banks in Luxembourg.
Several factors make banking in this country at the top. First, Luxembourg has good political stability and good communication. Besides, the employees also have good abilities, such as being multilingual and skilled.
Luxembourg also has easy access to several country centers in Europe. Banks in Luxembourg also have cross-border expertise and a tradition of banking secrecy. This is what makes the banking sector contribute a lot to the economy in Luxembourg.
The tourism Hokijoss sector is also important in the Luxembourg economy. This sector employed around 25,000 employees in 2009, or the equivalent of 11.7% of the population.
Finally, those are some of the sectors that contribute a lot to the Luxembourg economy and the amount of GDP in Luxembourg in 2021. Hopefully, this article will be useful.