LUXEMBOURG
Economy
Economy
Cities in LUXEMBOURG
| Luxembourg city |
Economy
General
In the course of its history, Luxembourg developed from an agricultural area into one of the most modern and wealthiest countries in Europe. The GNP per capita at $105,100 (2017) is one of the highest in the world. The gross national product consists of 0.3% agriculture, 12.8% industry (including construction) and 86.9% services and government (2017).
Due to its financial sector, Luxembourg has been one of the leading financial centres in the world since the 1970s. 78.9% of the active population is employed in the service sector, 20% in industry and 1.1% in agriculture. About 40% of the workforce is foreign, most of them cross the border every day.
Agriculture
The number of farms has decreased by about 60% since 1950. The average farm size has increased and was 46 ha in 2013. Animal husbandry (cows and pigs) is the main form of agriculture.
Cheese and milk production has risen sharply and exceeds domestic needs In the north of the country, mainly feed grains, barley and potatoes are produced. In the south, wheat and fruit are important agricultural products. Another important agricultural sector is grape growing in the Moselle valley. The vineyards located here produce excellent white wines. Usually, half or more of the wine production is exported. About 34% of the country's surface is covered with forest.
Mining and ebergy
Iron ore mining in the far south, which dates back to the 17th century, declined sharply from 1950 onwards due to declining iron content, high phosphorus content and poor competitiveness against richer deposits in other countries. Production stopped in 1981 and iron ore is currently imported. There are still some quarries. The Grand Duchy is 95% dependent on other countries for its energy supply. Its own electricity production (hydropower) provides for the remaining 5% of domestic energy consumption.
Industry
The iron and steel industry in the south-west of Gutland is very important for Luxembourg's economy. However, at the beginning of the 1970s, as a result of the general downturn in European industry, the demand for steel and iron fell. As a result, steel production has fallen sharply since the second half of the 1970s. Other industrial enterprises are: plastics and chemical industry, pharmaceutical and metal processing industry. Some multinational companies are based in Luxembourg, such as Goodyear, Du Pont and General Motors, which together account for over 25% of the country's total industrial output.
Trade
Since 1921, Luxembourg has formed a monetary and economic union with Belgium, the Belgian-Luxembourg Economic Union, BLEU. This union has lost much of its importance since the creation of the Benelux and the European Union. Virtually all trade takes place with other EU countries, with Germany and Belgium being the most important partners. Imports are mainly of finished products, ores and coal. Steel products account for just over 15% of exports. The rubber and plastics industry accounts for 10% of total exports.
Banking and finance
Luxembourg's banking and financial function, fostered by a more favourable fiscal climate than in its larger neighbours and by strict banking secrecy guaranteed by law and the absence of a controlling central bank, is also reinforced by the city's role as capital of the ECSC and as seat of other EU institutions. Under pressure from other European countries, it was decided to make it compulsory for banks to report suspicious transactions to the judicial authorities. In 1995, banking secrecy was lifted for larger tax fraud and criminal cases.
The banking sector is a major contributor to the gross national product. The majority of banks are legally foreign.
Traffic
In goods traffic, the (state) railways play a major role. The road network is 6,500 km long. The port of Mertert on the canalised Moselle is important for goods transport by water. International air traffic is handled by Luxembourg-Findel Airport.
Sources
Encarta Encycloppedie
Europese Unie
Europees Platform voor het Nederlandse Onderwijs
Fonteyn, G. / Ardennen, Luxemburg
ANWB Media,
Grote Lekturama Wereldatlas, Europa
Lekturama
Smets, P. / Het Groothertogdom Luxemburg
Lannoo
Stoks, F. / Ardennen, Luxemburg
Gottmer
Vermeulen, J.J. / Het Groothertogdom Luxemburg
Lekturama
CIA - World Factbook
BBC - Country Profiles
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