User:Dr Gangrene/Economic history of Luxembourg

The Grand-Duchy's economic and social start was not easy: The years 1815-1818, and even beyond, were years of misery in Luxembourg. bad harvests, famine, a collapse in demand (for exanple in the steel and iron industry.

When they were created by the Congress of Vienna, the Netherlands had already accumulated enormous public debts dating from the time before 1815. In 1814 this debt amounted to 1.25 billion florins. The King-Grand Duke made Belgium and Luxembourg participate in this debt, which had not been their concern. An excessive level of taxation was imposed on the new Grand Duchy: this tax system was devised for the territories of the old United Provinces, a rich and economically developed country. The high level of taxation was not at all suited to the Grand Duchy, a poor, isolated, and agrarian country.

Property taxes and personal taxes were disproportionate compared with the economic potential of the country. Other taxes did not take into account the economic circumstances of the country. Thus, the patente -- a tax on trades and businesses -- badly affected small family shops which had to pay several patentes, as they practised multiple types of commerce. Two taxes were particularly inappropriate, the tax on wine and the tax on eaux de vie, which had to be paid before the product was sold, which was catastrophic for small businesspeople, without working capital. The tax on eaux de vie was convenient for the large distilleries of the northern Netherlands. The most hated taxes were the tax on mills, and on the right to slaughter animals. These two taxes presented three major disadvantages: they hit the most impoverished, those who were driven to eat bread; they were a tax on staple foods; they were irksome and aggravated by clumsinesses linked to the collection.

The specific tax situation was confirmed by the following aspects. Firstly, customs rights, adapted to the rich provinces of the Netherlands, mostly hit the most impoverished in the Grand Duchy.

Further, it was the syndicate for repayment of the kingdom's debt (1822) which irritated the Luxembourgers, as it especially envisaged the sale of state lands (e.g. forests) to the profit of the Dutch public debt. By the time of the Belgian Revolution, the Luxembourgish state was mostly dispossessed of its public lands.

To sum up the consequences: on the economic level, the Dutch fiscal system imposed on the Grand Duchy was fundamentally counter-productive, and damaging to the economy.

In 1828, there were 11 metal-working factories in the Grand Duchy (with the borders as they were), with 6 different owners. There were 146 workers in these factories, and a further 273 working in transport and other associated occupations. The activity of the factories was at a low level, producing just above 1,480 tons of cast iron.

After the Treaty of London of 1839, when Luxembourg became a state independent of the Netherlands, it was given access to the Zollverein. The Luxembourgish population was largely opposed to the entry into this customs union. The Luxembourgers feared the Prussian militarism, which was present in their minds due to the garrison, and the growing economic power of their neighbour. The Luxembourgish economic actors were divided, each according to their interests: the world of agriculture and wine-growing were hostile; the iron and steel industry, and tanners, were in favour. Nevertheless, under Prussian pressure, William II made Luxembourg enter the Zollverein in 1842. As a precaution due to Luxembourgish reluctance, their membership of the Zollverein was limited by time, but was regularly renewed in any case (1847, 1853, 1872, and in 1902 until 1959). Every time renewal came up, the junior partner was exposed to massive pressure by its neighbour. In the long term, the Zollverein was beneficial for Luxembourg. The country's economic isolation was broken by the suppression of the customs border with Prussia (later, Germany). But in Luxembourg, another worrying aspect appeared:Luxembourgish adhesion to the Zollverein was less a customs union, than a customs absorption or annexation. The customs administration in Luxembourg employed German functionaries (amongst others, the director), which reminded several of the situation of dependance under the Dutch regime.

The Chamber of Commerce was created by royal and grand-ducal decree of 1 October 1841: even before the state machinery was in place, employers had organised themselves.

The setting up of institutions and the organisation of the Luxembourgish state were difficult. A certain trial period was necessary: it was a massive innovation, as for the first time Luxembourgers administered their own country.

The economic situation, on the other hand, was quite disastrous: independence had isolated the country, encircled by three borders. Two components appeared: the first was linked to the customs line which now separated the Grand Duchy into Walloon and Germanic parts: an age-old relationship was interrupted. The Belgian law of 6 June 1839 accorded exceptional favours to the Grand Duchy for exports to Belgium. Luxembourgish cast iron, for example, had a customs exception. This was processed in Wallonie, which also profited from it. Luxembourgish agricultural products also benefited from some customs advantages. This law of preference prevented the stifling of the Luxembourgish economy, but was beneficial to both parties. The law of preference was in fact more of an emergency measure in the short term, than a real solution to Luxembourg's economic isolation.

The opening towards France and Prussia was the second part. As France remained reticent, the Zollverein was the only solution. Two aspects came into play: the budget and customs rights.

The budget.

Independence made Dutch constitutional law inapplicable to Luxembourg. The consequence was a certain constitutional vacuum. The Constitution of 1841 did not allow control of the budget. This carried grave consequences. Ainsi, les revenus douaniers du budget de 1839 sont estimés à 35 050 florins, mais les recettes effectives sont de 104 810 florins. « Guillaume a pu remplir un Trésor qui était plus le sien que celui du Luxembourg, attendu que lui seul en disposait sans avoir de comptes à rendre à personne». Autre anomalie : le produit de la vente de biens domaniaux – payables en 1839 – a été versé au Trésor néerlandais.

Customs rights.

After the independance, a third frontier (after France and Prussia) came about with Belgium. A curious situation was thus installed: on either side of the Belgo-Luxembourgish border, the same customs tariff was applied reciprocally. This tariff, borrowed from Belgium, amplified the cost of Luxembourgish indispensable imports. The right to charge customs on a product not produced in Luxembourg, or a raw material that was rare there, resembled a tax. The tariff sometimes reached the level of the product's value.

The decree of 20 July 1840 introduced a Luxembourgish tariff. Inspired by that of the Zollverein, it was quited unsuited to the Luxembourgish economy. Let us take two examples.

The small slate industry was well-protected by the Belgian tariff. But the new Luxembourgish tariff – basically that of the Zollverein – did not provide for any rights, as Prussia did not produce slate, and the product could be freely imported into Luxembourg. The Luxembourgish slate industry suffered badly under Belgian competition. The Zollverein lacked cast iron, and hence forbade the export of this product. Accepting this into Luxembourgish law had a disastrous effect on the local iron industry, since out of a production of 8 000 tonnes, about 7 000 tonnes were exported. An economic nonsense reigned: raw materials which were badly needed in Luxembourg, were taxed on importation, as the Zollverein possessed these in abundance, such as coal. A. Calmes spoke of a "monument to ineptitude or malfeasance". Why such a policy? The same author had this response: "tax revenues by all means"

Let us consider in detail the production of cast iron in Luxembourg in 1841. Cette statistique fournit un renseignement comptable intéressant, immeuble et capital roulant. Il s’agit des moyens de l’entreprise (inscrits à l’actif du bilan) : l’actif immobilisé et l’actif circulant. Malheureusement les deux ne sont pas indiqués séparément. Retenons que ces données sont probablement des estimations. L’actif immobilisé des trois forges à deux hauts fourneaux est estimé à 450 000 francs ; des quatre forges à un seul haut fourneau deux sont évaluées à 280 000 francs.

New
The years before the First World War were characterised by sustained growth of the steel industry. This branch of industry, based on the iron ore deposits located in the south of the country, had its roots in the second half of the 19th century. Nevertheless, it was the construction – in the course of the two decades before World War I – of the large integrated steel plants (as in Differdange or Belval), permitting the processing on the same site of cast iron into steel and steel plates, which was determinant for the later development of this economic branch, and of the country as a whole. A part of these investments was made possible thanks to German capital. From 145,313 tonnes in 1900, the production of steel rolls went to 1,115,004 tonnes in 1913, and the steel industry represented about 60% of the total industrial workforce before World War I.

The population increased at an accelerated rhythm, going from 211,088 inhabitants in 1890 to 235 954 in 1900, and then to 259 891 in 1910. Within twenty years, it had therefore increased by about 50,000, while over the previous two decades (1870-1890), it had grown only by 13,500.

The population increase went hand in hand with a concentration of the population in the city of Luxembourg and the canton of Esch-sur-Alzette (bassin minier  et sidérurgique). In 1880, 11,4% of the population had lived in the canton of Esch-sur-Alzette, but this proportion increased to 26% by 1910. Together, the city of Luxembourg and the canton of Esch-sur-Alzette shared 45% of the population on the eve of World War I, compared to 26% in 1880.

The demographic growth was mostly due to a wave of immigration (fist German, then Italian) linked to the high demand for manpower in the steel industry and the iron ore mines. The proportion of foreigners as part of the total population doubled in twenty years, going from 8,5% in 1890 to 15,3% in 1913. This immigration movement occurred at the same time as an emigration movement: between 1840 and 1907, about 80,000 Luxembourgers left the country.

The departures of the years 1840-1870 can be explained by poor living conditions. For the period after this, marked by the rise of steel production, the emigration seemed to derive more from a socio-cultural phenomenon, with Luxembourgers being hesitant to take up work in industry.

Nevertheless, close to 40% of the working population were employed in the industrial sector according the census of 1907. According to numbers for the preceding period, Luxembourgish industry employed only 20% of the active population in 1870.

The supply of coal and coke for the steel industry were made possible by Luxembourg's membership of the Zollverein, which was also the principal market for steel products. At the same time, this sector was the object of a movement of concentration and financial and industrial rationalisation. In 1911, ARBED (Aciéries réunies de Burbach-Eich-Dudelange) was founded out of the merger of three companies. This became one of the largest steel producers in Europe. In 2001, it merged with Usinor and Aceralia, thus contributing to the formation of one of the biggest world steel companies, Arcelor. In 2006, Arcelor in turn merged with Mittal Steel, creating the group Arcelor Mittal.

The economic growth from 1900 to 1913 is reflected in the population's growth, with an average of 1% per year. It was in the course of this period that the basis of social security legislation (accident insurance, health insurance, old age insurance) was created.

Les années 1913-1951: fortes turbulences
The years 1913-1951 were marked by strong turbulences due to the two world wars and to the crisis of the late 1920s and early 1930s. A certain social agitation, linked to change in economic and social structures and resulting from difficult living conditions, characterised the end of World War I and the immediate post-war period. The repercussions in the domain of employment legislation were soon to come. From 1918 to 1926, social advances were numerous: the 8-hour working week in heavy industry, workers' representation within companies, unempoloyment benefits, adjusment of salaries to living costs for civil servants, creation of professional chambers, health and safety regulations in the workplace, paid holidays for employees, later for workers.

The denunciation of the Zollverein at the end of the First World War imposed an economic reorientation. In 1921 the Belgium–Luxembourg Economic Union (UEBL) was created. Numerous small and medium traditional businesses, prior to the war oriented towards the German market, had big difficulties in adapting themselves.

After the departure of German capital, steel factories were taken over by groups with Franco-Belgian-Luxembourgish capital. Despite the context of increasing competition due to the emergence of new producer countries, the Luxembourgish steel industry succeeded in diversifying its outlets, increasing its productivity, and growing its production before the world crisis produced its effects after 1930.

The 1930s constituted a period of economic stagnation, even if a brief bright spell in 1937 allowed the tonnage of rolled products to once reach its level of 1929. During the war years, steel production did not surpass the feeble level of 1939 except in one single year (1943).

The variations in production of iron ore reflected the cycles of steel. After continuous growth until 1913, the First World War brought about a significant drop in ore production. The favourable economic situation in the steel industry during the late 1920s and the crisis of the 1930s had a direct effect on the volume of extracted ore. In addition, the level of production attained by Luxembourgish iron mines on the eve of World War I would not be reached again in coming years. Even the significant growth in steel production from 1945 to 1974 was not translated into a parallel increas in mine extraction.

In fact, Luxembourgish ore (Minette) was poor in iron, and the steel industry before World War I made use of the more iron-rich ore from France, and after World War II also from Brazil and Sweden. The proportion of Luxembourgish ore consumed by the Luxembourgish steel industry went from 56% on average during the 1920s to 44% in the 1930s. From the 1960s, this proportion dropped significantly to 30% in 1970-1974. This was a precursor sign of a movement which resulted in 1981 in the closure of the last ore mine.

When it comes to the job market between the wars, the immigrant workforce played a role of regulation. In 1922, the part of the foreign population – about 33,400 persons – of the total population was only 12,8%, compared with 15,3% in 1910. A consequence of the relatively favourable state of steel in the late 1920s and a new wave of immigration, the percentage of the foreign population reached 18,6% in 1930, before the global crisis intervened. With 12,9% of the total population in 1935, the proportion of foreigners decreased to the level of 1922.

As often during period of crisis, important social innovations were introduced in the course of the 1930s: in 1936 was created the Conseil national du travail – an institution of reconciliation intended to prevent and to iron out labour disputes –, composed equally of representatives of workers and management. Numerous collective agreements were concluded in this framework, especially in the mining and steel industries.

For the whole of the period 1913-1951, the level of GDP growth is estimated at about 1,6% as an annual average. Population growth barely reached 0,3% per year on average, against 1% in the course of the years 1900-1913. In addition, the role of the state affired itself in the interwar period. Government expenditure represented 7,8% of the national income in 1913, but 16,6% of it in 1935.

Les trente glorieuses
The economic reconstruction after the Second World War was at the origin of the exceptional level of growth of 6,7% on average of the years 1946-1951. From the 1950s to the mid-1970s –  that is, until the first oil crisis and the simultaneous steel crisis –, average growth was at a more modest level of 3,9%.

Despite the significant fluctuations of value added in the steel industry, it was this branch of industry which determined in large part the growth level of the whole Luxembourgish economy during the trente glorieuses (1945-1975). Raw steel production went from 2,45 in 1950 to 6,45 million tonnes in 1974. In the early 1970s, the steel industry represented 30% of value added in the Luxembourgish economy and more than half of value added in industry (including construction). Steel factories and iron mines employed 25,000 people in 1974, or 16% of people employed in the Luxembourgish economy.

However, from the late 1950s, the policies industrial diversification were intensified, as were efforts to promote Luxembourg abroad, particularly in the United States. Goodyear's setting-up in Luxembourg in 1951 was still an isolated event, but from 1959 to 1972, about 50 companies installed themselves in the country, including DuPont de Nemours in 1963.

The impressive growth of the steel industry until 1974 should not overshadow the growth of the tertiary sector (commerce, hotels and restaurants, public administration, etc.). In 1970, the part of the working population in services was 48,6%, as against 34,5% in 1947. Inversely, the part of agriculture rapidly collapsed: from 27% of the working population in 1947, it reduced to 7,5% in 1970. It was the recourse to immigrant labour which permitted a response to the general progression in the need for labour. The part of foreigners in the active population – which was 11,4% in 1947 – reached 21% in 1970.

In the social domain, the advances were particularly pronounced in the years immediately after the Second World War, as well as during the decade 1965-1974. In 1944-1945, were created the Conférence nationale du travail (replacing the Conseil national du travail of 1936) and the Office national de conciliation which oversaw a system of arbitration and of declaration of general obligation of wage agreements. In December 1944, the "salaire social minimum" was installed.

When it comes to the second period of intensive legislative activity in the social domain (1965-1975), one must note the law of 1965 on collective conventions which required indexation of salaries to the cost of living ("échelle mobile") and which introduced the principle of national representativity. In 1975, the mechanism of automatic and integral indexation was extended to all salaried workers. The working week for workers was limited to 44 hours by the law of December 1970, which also introduced the 40-hour week from 1 January 1975. In 1966, the Conseil économique et social was created, a consultative organ composed of representatives of workers, business owners and experts appointed by the government.

Finally, Luxembourg was an active participant in the process of European integration. Luxembourg was a signatory of the Treaty of Paris creating the European Coal and Steel Community in 1951, and of the Treaty of Rome creating the European Economic Community in 1957.

The economic crisis of 1975-1985
The economic crisis of 1975-1985, linked to the first and second oil shocks, badly affected the Luxembourgish economy. The steel industry was confronted with grave problems, as a result of overproduction on a global level which generated pressure on prices. In 1983, the production of raw steel was only at 3,2 million tonnes (against 6,45 in 1974). It had thereby receded to 1955. In 1985, the workforce in the steel industry was about 13,400 people, half the number of 1974. For the whole of the period 1975-1985, the level of GDP growth was an average of 2,3% per annum, whereas for 1953-1975, it had been almost 4%.

Responses to the crisis were on a social, institutional and economic level. The social response consisted of the creation of travaux extraordinaires d’intérêt général (TEIG), extraordinary works of general interest, in 1975 and the creation of the "Division anti-crise" (DAC) in 1977. At the end of the same year, legislation concerning "pre-retirement" accompanying the reduction of the workforce in the steel industry was passed; this permitted steel workers to bring forward their retirement.

The rise of unemployment could not be completely held back – the number of job-seekers was 3,874 in 1984 –, but these measures prevented full-scale layoffs. Between 1975 and 1986, about 14,800 workers left the steel industry, of whom 30% (4,300) benefited from the "pre-retirement" framework. This system was extended in 1987 to all mercantile economic sectors.

At the institutional level, these years were marked by the creation of the Tripartite. Already in 1975, in the context of the law of 26 July 1975 authorising the government to take measures destined to prevent lay-offs for economy-related causes and to assure employment, a Comité de conjoncture had been created, with a tripartite composition (business-owners, workers, government). This committee had to monitor the evolution of the economic situation and make regular reports to the government. Faced with the aggravation of the crisis, a tripartite conference for the steel industry, which met during the 1977, elaborated a plan for the maintenance of economic growth and full employment, which was the origin of the law of 24 December 1977 instituting a Comité de coordination tripartite. In March 1979, the Conférence tripartite sidérurgie came to an agreement to restructure and modernise the steel industry. The Tripartite proved long-lasting, and is currently at the centre of what many term the "Luxembourgish social model", i.e. a system in which the search for consensus solutions to socio-economic problems has become the rule.

When it comes to the economic level, the responses came at first from the steel industry itself. From 1975 to 1979, the investments of the steel companies increased and, in 1978, for the first time since the 1950s they were higher than the average level for other European countries. In addition, the movement of financial and industrial rationalisation (prises de  participation  et  fusions) which had started in the 1960s accelerated.

In the late 1970s, ARBED remained the only steel company in Luxembourg. The state's participation in the management of the crisis started first with social measures (création des travaux extraordinaires d’intérêt général et participation au financement de la division anti-crise), but also investment help (subventions ordinaires et extraordinaires en capital, etc.). The particularly dire state of the economy of the early 1980s necessitated a downwards revision of the investments planned in the framework of the tripartite agreement of 1979, as well as a financial restructuration of the highly endebted sector, accompanied by collaboration agreements with the Belgian steel industry. The Luxembourgish state intervened on a large scale in this restructuring, notably through the intermediary of the Société nationale de crédit et d’investissement and, at the end of this, it held 42,9% of the ARBED's shares (and 30,9% of voting rights).

It was therefore an exceptional collective effort which allowed the survival of this important pillar of the Luxembourgish industrial landscape which the steel industry constituted. About 5% of average budget expenses of the period 1975-1987 were devoted to saving the steel industry. in addition, the evolution of technological productivity of steelworkers showed that the modernisation and rationalisation efforts in this sector of industry continued in recent years.

The more or less positive outcome of the crisis years 1975-1985 was also linked to three other elements: the rise of financial services which occured at practically the same time as the decline of the steel industry; the intensification of the policy of economic diversification; a policy of wage restraint in the early 1980s – shown notably in the temporary suspension of automatic indexation of salaries in 1982 – which permitted to re-establish the cost competitiveness of the Luxembourgish economy.

Finally, let us mention the growth of expenditure by public administrations (central government, local government, social security) which intervened in the course of the period of 1975-1985. This expenditure, which was at 35% of the GDP on average in the years 1971-1975, reached about 50% of the GP in the course of the years 1981-1985. This development was a result, on the one hand, of the feeble growth levels of the GDP, but equally, and especially, of the growth of social transfers (transfers to households) which went from just under 14% of GDP in 1974 to almost 24% of GDP in 1981. Evidently, the social measures accompanying the restructuring of the steel industry contributed to this increase, but there was also generally an amelioration social protection benefits and social aid.

1985-2000: fifteen exceptional years
From the mid-1980s to 2000, the level of average GDP growth reached a level hitherto unknown in Luxembourg for such a prolonged period – over 5% – and surpassed by far that of other European countries, apart from Ireland. Between 1985 and 2000, total employment went from 161 000 to 264 800, with a an average annual growth level of 3,4%. The acceleration of growth implied an increased recourse to immigrant workers, and cross-border workers. 12,000 cross-border commuters worked in Luxembourg in 1980. Their number reached about 127,000 in 2006. The part of the foreign population of the active population, which was 18% in 1970, reached 41% in 2006. In the domestic salaried employment, the part of Luxembourgers represented only 32% in 2006, but the proportions of cross-border workers and immigrant workers were 41% and 27% respectively.

The following principal factors were at the origin of this exceptional development since 1985: the continuous growth of the financial sector; the favourable evolution of other economic branches, such as "business services", whose development had been partly brought about by financial services; IT services and transport and communications; a productive and competitive industrial sector, although its relative part in the sum of added value in the economy diminished after the exceptional growth of services; high levels of investments; low levels of taxes and levies on salaries, which allowed the cost of labour to be kept at a competitive level; un taux de  prélèvement obligatoire  global et de dépenses publiques en baisse (par rapport au PIB) en cours de période et plus particulièrement entre 1995 et 2000. Le total des dépenses publiques au Luxembourg – Sécurité sociale comprise – qui était encore de 45,6% du PIB en 1996 se réduit à 38,5% en 2000; ce chiffre est à comparer à un taux de dépenses publiques de près de 46% du PIB dans l’Europe des Quinze en 2000.

Some of these factors are connected. For example, the strong growth – induced in large part by the financial sector – permitted a certain flexibility in fiscal policy which, in turn, favoured the competitiveness of the Luxembourgish economy and constituted a growth factor.

Le retournement conjoncturel 2001-2003 dans une perspective de moyen terme
Most economies of the world experienced an exceptionally high level of economic expansion in the course of the late 1990s. Thus, the United States' growth level averaged at 4% per year 1996-2000; in Europe, the growth level was 2,7%. This growth allowed a reduction of unemployment, which was at 10,5% in 1994, to 7,4% in 2001 in the 15 EU states. In the US, unemployment started its reduction from 1992. In 2000, it reached, compared with 7,5% in 1992. This evolution occurred in globally non-inflationary context: apart from 1995, the growth level of consumer prices never outgrew 2,5% in the course of the late 1990s, neither in the United States nor the in the EU-15. Luxembourg followed this movement, albeit with a characteristic resulting from the country's opening and the exposure to the oil shocks, namely high variations in added value. The average annual GDP growth level was 7,3% from 1997 to 2000. This soaring was mostly, but not solely, facilitated by the strong expansion of the financial sector. Three other branches of services experienced an above-average expansion in this period: «commerce et réparations», transport and communications, and the health sector. Finally, note the high performance of industry from 1995 to 2000 i terms of growth of added value.

The peaks in growth of total value added of the Luxembourgish economy correspond to the combination of exceptional growth levels of value added in financial services, but also in other services (commerce, transport and telecommunications, busines services, etc.) and in industry. Note also that in 1998, le fléchissement très important de la croissance de la valeur ajoutée des services financiers (banques) a été compensé par des taux de croissance très positifs des services autres que financiers. On retrouve le même phénomène – avec une ampleur moindre – en 2001 et 2003, années où la croissance de valeur ajoutée des services financiers est négative.

À partir de 2001, l’économie luxembourgeoise suit la décélération des activités économiques au niveau mondial. Le retournement conjoncturel de 2001 implique un net recul de la  croissance  du  PIB  (en  volume)  qui  passe  de  8,4%  en  2000  à  2,5%  en  2001. Ce mouvement a été accentué par la mauvaise santé des marchés financiers. Un recul de la valeur  ajoutée  du  secteur  moteur  de  l’économie  luxembourgeoise  que  sont  les services financiers (taux de croissance négatif) s’en est suivi en 2001 (voir graphique). Les banques et autres organismes financiers réagissent aux moindres revenus en comprimant à leur tour les dépenses (de personnel, de frais généraux, d’investissement) et agissent par là comme frein sur les autres secteurs domestiques qui sont commercialement dépendants du secteur financier, comme les services aux entreprises (nettoyage, sécurité, etc.). Cet effet  de  freinage  ne  s’est  cependant  fait  ressentir  qu’avec  retard, c’est-à-dire en 2002. En 2001, l’expansion de ces services autres que financiers (commerce de gros, commerce de détail, transports et communications, services aux entreprises) restait assez forte pour amortir quelque peu la chute de la VAB du secteur financier.

Il reste que le recul global en 2001 est spectaculaire. En 2002, la croissance de la valeur ajoutée des services financiers redevient positive. Le secteur  financier  replonge  en  2003  avant  de  connaître  une  hausse  conséquente en 2004, 2005 et 2006. Cependant, la croissance des services financiers ne semble pas atteindre les  niveaux  de  1999-2000,  années  qui  sont  caractérisées  par  une  véritable explosion de la valeur ajoutée du secteur financier. Le rythme de croissance de l’industrie et des services autres que financiers est positif en 2002, en 2003 et en 2004, sans pour autant atteindre les sommets de 1997 et 2000 (pour l’industrie), respectivement 1998 et 2001 (pour  les services autres que financiers). À noter la décélération de  l’industrie en 2005. Il en résulte une croissance assez «molle», les secteurs économiques ne donnant pas l’impulsion simultanée nécessaire qui aurait pu conduire à une véritable envolée des taux de croissance comme le Luxembourg les a connus lors des «années fastes» de 1997 à 2000.