Trading Partner Portal: Luxembourg
Luxembourg lies in between France and Germany in Western Europe. With a population of 607,728 people and a gross domestic product (GDP) of $70.8 billion, Luxembourg is classified as a high income country. Luxembourg’s economy is centered on its leading financial sector that accounts for over 35% of its GDP. Luxembourg has one of the highest GDP per capita in the world and is the highest in the Eurozone, which results in a prominent high standard of living. Some of Luxembourg’s main trading partners are Belgium and Germany; however, the United States is its fourth largest importer. World Bank, CIA
In 2019, the US exported $1.9 billion worth of goods and products to Luxembourg. ALmost half of those exports was transportation equipment, which had a total value of $897.8 million. The US also exported $406.7 million of secondhand merchandise and $156 million of chemicals. In the same year, the US imported $633 million of goods from Luxembourg. Primary metal manufacturing made up 26.6% of the total, followed by reimports which made up just over 21% of the total. Another key imported category was fabricated metal products, which accounted for 10.5% of the total, and plastics and rubber products, which accounted for 8.6% of total imports from Luxembourg into the US. US Department of Commerce
The United States and Luxembourg have healthy flows of investment across their borders. In 2018, the US had $713.8 billion in foreign direct investment (FDI) in Luxembourg. Additionally, Luxembourg had $18.4 billion of investment in the United States. Luxembourg FDI into the US supported 13,200 jobs and contributed $7 million to research and development, as well as another $81 million to expanded US exports. The top industry sectors for Luxembourg’s FDI were: consumer products, metals, communications, software and IT services, business services, and plastics. Select USA
Luxembourg- California Trade
California is one of the largest exporting states to Luxembourg in the US. California exported $106.7 million of goods to Luxembourg in 2019. The top export category from California to Luxembourg was transportation equipment totaling $36.2 million and 33.9% of the total exports. Other exports from California was used or secondhand merchandise at 33.7%, computer products 8.4%, and agricultural products at 7.5%. In 2019 California is the top ten importers of goods from Luxembourg, importing approximately $34.5 million worth of goods. Some of the major imports were reimports that accounted for $10 million and 29% of total imports into California from Luxembourg, followed by primary metals which made up 27.4% of the total. US Department of Commerce
In California, the number fifteen country for FDI through foreign-owned enterprises (FOEs) is Luxembourg. FOEs from Luxembourg in California provide 11,163 jobs through 522 firms amounting to $793 million in wages. The top jobs by sector are: retail trade, professional/business services, leisure/hospitality, wholesale trade, and manufacturing (World Trade Center Los Angeles FDI Report, May 2020).
Trade Agreements and Issues
Transatlantic Trade and Investment Partnership (TTIP)
Luxembourg is one of the nations that is currently involved in negotiations for the Transatlantic Trade and Investment Partnership (TTIP) with the rest of the European Union and the United States. The United States and the European Union have a strong bilateral trade relationship totaling $698.7 billion in 2015. A free trade agreement, such as TTIP, desires to strengthen that relationship by eliminating tariffs, aligning compatible regulations to open trade, and furthering trade in the service sector.