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Structural constraints are weighing on Luxembourg economy, IMF warns

13.07.2026 - Luxembourg Times

Pressespiegel

The International Monetary Fund has warned that Luxembourg’s prolonged economic slowdown is not due to temporary factors alone, but also reflects “structural constraints” facing the economy.

Luxembourg’s economy has been effectively flat since 2022, with annual real GDP growth averaging 0.0% over four years. The economy contracted by 1.1% in 2022, before growing by just 0.1% in 2023, 0.4% in 2024 and 0.6% in 2025.

The full report expands on warnings made by IMF mission chief Anna Shabunina in May, when she said Luxembourg’s shift away from its past dynamic growth was a concern and that the fund would examine the structural aspects of the slowdown in greater detail.

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