The Chamber's main takeaway is that 2020 will be a difficult year for businesses. Both in the look back at 2019 and the predictions for the next year, the Chamber of Commerce spoke of uncertainty.
Director general Carlo Thelen highlighted that there has been an economic slowdown since the first half of the year, with both worldwide trade conflicts and Brexit having their impact on businesses in Luxembourg. Thelen pointed to Luxembourg's neighbours, stating that German industry has also slowed down spectacularly. He stressed that Luxembourg knows Germany has experienced economic slowdown, as Germany makes up 20% of Luxembourg's export market. It would be normal for Luxembourg to be affected sooner or later, he added.
On a positive note, however, the Chamber of Commerce is not presuming there will be a recession in 2020.
The first sectors to experience a worsening economic will be the transport and logistics industries, but retailers and the hospitality industry will follow. Generally, Thelen noted that Luxembourgish firms are not positively set-up for the next year, which is concerning for the Chamber. Broadly, the Chamber of Commerce is concerned about structural deficits.
Added to the whole situation is the economic loss of traffic jams. Calculated, traffic jams preventing people from getting to work or to shops, or receiving deliveries, all add up to a €1.4 billion lost thanks to the ongoing traffic chaos. In other words, 3% of Luxembourg's gross domestic product is lost as a result of 'immobility'.
On another point, Thelen added that decision processes must be simplified and made faster, especially in the domain of housing. Businesses must be given the opportunity to innovate and continue training their employees. Finally, the Chamber of Commerce outlined areas requiring improvement on the side of the government. In order to give the economy a boost, Thelen said, the government should act to improve hiring qualified people, land development, and laws on bankruptcy.
