Diversification is “crucial, especially for a smaller economy like ours that is open to the world”, Mr. Gramegna, the Minister of Finance, says. But innovation within existing sectors is as important as branching out into new ones, he adds. “We have tried to diversify by building on our existing strengths. Our steel industry has not disappeared. We are still a major producer of specialised steel.”
When one quarter of your economy depends on financial services you want to diversify. But because the financial sector has adjusted so well, modernised, reinvented itself, it has kept pace with the endeavours and investments in other sectors.” The minister says as soon as he took over the finance portfolio seven and half years ago he identified the potential of financial technology for Luxembourg. “And when I started talking about that people in the country looked at me in surprise. What is he talking about? Why is he not talking about banks and investment funds? Today I think everybody has integrated the importance of fintech in transforming financial services.”
The government set up a public-private fintech accelerator, the Luxembourg House of Financial Technology, with some 80 companies and a similar number of affiliated ones. New technology ventures are seeking to build on niche sectors where Luxembourg is already a strong player, such as fund management, regulatory compliance and insurance.
Lead the story in Financial Times published in February 2021.
Pierre Gramegna, Minister of Finance of Luxembourg