The Grand Duchy’s emblem seen on the front gate at the foreign ministry on the place Clairefontaine, photographed in April 2015. Photo: Julien Becker
As the UK government gets its ducks in order to prepare negotiations to leave the EU, the Luxembourg government has not been idle either.
Luxembourg is preparing itself to be as accommodating as possible while keeping the integrity of the European single market.
The government seems to be taking a dual approach to Brexit: on the one hand, it discusses the issue in the already established Interministerial European Policy Committee (Comité interministériel de coordination de la politique européenne), which is headed by the foreign affairs ministry, and on the other in the High Committee for the Financial Centre (Haut Comité de la place financière), which is under the direction of the finance ministry.
The CICPE is, roughly, in charge of the political aspects and official negotiations and has already discussed the issue a few times, according to the foreign affairs ministry. The HCPF considers the economic impact and opportunities together with the most important players in the economy.
Serge de Cillia, director of the Luxembourg Bankers’ Association (ABBL), said in an interview with radio 100,7 that the HCPF has created a “task force which gathers information from all the actors from the financial and economic sector and plans to develop a comprehensive offer for banks and companies who are interested in coming to Luxembourg.” He hoped that by the end of the year, an offer could be presented with answers related to regulation, business taxation, housing and schooling.
Over the years, the two countries were allies on several policy areas in EU Council negotiations such as free trade, cutting red tape, and on financial regulation (they were both against the proposals for a financial transaction tax). It is in Luxembourg’s interest to ensure the UK is not isolated in these negotiations, said the minister for the economy Étienne Schneider. While the government wants the negotiations to start as soon as possible because of the economic, political and financial uncertainties the vote has created, it is not in Luxembourg’s interest to pressure the UK unnecessarily.
While the foreign affairs ministry has reiterated that the four freedoms (free movement of goods, people, services and capital) are indivisible, that the integrity of the single market should be safeguarded, it has also stated that the UK should remain one of the key bilateral partners. When asked if there would be a reciprocal restriction to UK migrants if the UK government were not willing to accept the free movement of workers, the ministry of foreign affairs warned that that would not be an unlikely outcome, but hopes it won’t come to that, as maintaining access to the single market is in the interest of the UK.
It seems clear Luxembourg wants to keep the UK as closely connected as possible to the EU while reaping any potential benefits from Brexit.