Regarding Luxembourg’s economy in 2021 it has been markedly better than 2020 with the government recording a total revenue of €21.9bn at the end of last year. This represents a 16.3% increase compared to the end of 2020. Total revenues have increased by 10.5% compared to 2019, corresponding to an average annual growth of about 5.2% per year.

“I would like to thank my predecessor Pierre Gramegna for having managed public finances in such a sustainable way, which allows us to look forward to the end of the crisis with confidence,” said Backes.

Total expenditure at the end of 2021 amounted to €21bn, marking a slight decrease of 0.6% compared to the previous year. Compared to 2019 where public expenditure increased by 13.6% while public investment went up by 26.6%. Government disbursements related to the coronavirus pandemic marked a significant decrease reaching €681m, far less than the €2bn allocated in 2020. This reflects the decrease in the use of government aid schemes as well businesses having fared better.

Public debt stands at approximately 25% of Luxembourg’s GDP which is considerably less than the 29.4% expected at the time of the 2021 budget’s introduction.

“Although the current figures underline the resilience of the Luxembourg economy, many challenges lie ahead and require a prudent and responsible approach,” said Backes.