Based on the average exchange rate for 2020, Luxembourg uses the euro which appreciated by 3.1% against the US dollar since 2016 and increased by 2% from 2019 to 2020. The stronger EU currency in 2020 made Luxembourg’s exports paid for in weaker US dollars relatively more expensive for international buyers.
The latest available country-specific data shows that 79.7% of products exported from Luxembourg were bought by importers in: Germany (26.6% of the global total), France (16.4%), Belgium (12.3%), Netherlands (5.3%), Italy (3.9%), United Kingdom (3.4%), Spain (2.5%), Poland (2.4%), United States (2.2%), Austria (1.8%), China (1.5%) and Turkey (1.4%).
From a continental perspective, 86.8% of Luxembourg’s exports by value were delivered to fellow European countries while 7.6% were sold to importers in Asia. Luxembourg shipped another 3.6% worth of goods to North America. Tinier percentages went to Africa (1.3%), Latin America excluding Mexico but including the Caribbean (0.5%) then Oceania led by Australia (0.2%).
Given Luxembourg’s population of 626,000 people, its total $13.8 billion in 2020 exports translates to roughly $22,000 for every resident in the Western European country.
Luxembourg’s Top 10 Exports
The following export product groups represent the highest dollar value in Luxembourg global shipments during 2020. Also shown is the percentage share each export category represents in terms of overall exports from Luxembourg.
- Machinery including computers: US$1.9 billion (13.4% of total exports)
- Plastics, plastic articles: $1.5 billion (10.8%)
- Iron, steel: $1.31 billion (9.5%)
- Vehicles: $1.28 billion (9.3%)
- Articles of iron or steel: $782 million (5.7%)
- Electrical machinery, equipment: $731.5 million (5.3%)
- Rubber, rubber articles: $624.9 million (4.5%)
- Dairy, eggs, honey: $435.1 million (3.2%)
- Aluminum: $430.8 million (3.1%)
- Paper, paper items: $430.3 million (3.1%)
Luxembourg’s top 10 exports accounted for roughly two-thirds (67.8%) of the overall value of its global shipments.
Paper including items made from paper represents the fastest grower among the top 10 export categories, up by 2.7% from 2019 to 2020. The other two top categories to increase were vehicles (up 2.1%) and dairy, eggs and honey (up 0.04%).
The leading decliner among Luxembourg’s top 10 export categories was iron, steel: thanks to a -24.9% drop year over year
At the more granular four-digit Harmonized Tariff System (HTS) code level, Luxembourg’s most valuable exported products are iron or non-alloy steel angles, shapes and sections (5.3%), cars (4.8%), new rubber tires (3.6%), iron or sheet piling (2.9%), cellulose fiber paper (2.7%), self-adhesive plastic in rolls (also 2.7%) then coated or laminated non-woven materials (2.5%).
The following types of Luxembourg product shipments represent positive net exports or a trade balance surplus. Investopedia defines net exports as the value of a country’s total exports minus the value of its total imports.
In a nutshell, net exports is the amount by which foreign spending on a home country’s goods or services exceeds or lags the home country’s spending on foreign goods or services.
- Articles of iron or steel: US$318.4 million (Up by 6.1% since 2019)
- Plastics, plastic articles: $255.5 million (Up by 10.5%)
- Iron, steel: $249.1 million (Down by -44.1%)
- Felt, yarn, twine, ropes, cables: $247.4 million (Up by 1.8%)
- Rubber, rubber articles: $185.8 million (Up by 1%)
- Glass: $148.1 million (Down by -31.1%)
- Coated/laminated textile fabric: $123.8 million (Down by -12.8%)
- Vegetable/fruit/nut preparations: $76.6 million (Up by 26.8%)
- Copper: $59.6 million (Up by 10.8%)
- Dairy, eggs, honey: $53.5 million (Down by -1.7%)
Luxembourg has highly positive net exports in the international trade of iron or steel including items made from those materials. In turn, these cashflows indicate Luxembourg’s strong competitive advantages under the iron or steel category.
Luxembourg incurred an overall -$7.5 billion trade deficit during 2020, down by -6.1% from -$8 billion in red ink one year earlier.
Below are exports from Luxembourg that result in negative net exports or product trade balance deficits. These negative net exports reveal product categories where foreign spending on home country Luxembourg’s goods trail Luxembourg importer spending on foreign products.
- Vehicles: -US$1.9 billion (Down by -16.1% since 2019)
- Mineral fuels including oil: -$1.4 billion (Down by -36%)
- Electrical machinery, equipment: -$637.5 million (Down by -3.7%)
- Aircraft, spacecraft: -$432.2 million (Up by 42.2%)
- Pharmaceuticals: -$428.9 million (Up by 9.1%)
- Beverages, spirits, vinegar: -$330.4 million (Down by -9.5%)
- Furniture, bedding, lighting, signs, prefabricated buildings: -$315.4 million (Up by 2.7%)
- Machinery including computers: -$302.7 million (Up by 22.4%)
- Fruits, nuts: -$232 million (Up by 17.8%)
- Tobacco, manufactured substitutes: -$165.6 million (Up by 18.8%)
Luxembourg has highly negative net exports and therefore deep international trade deficits under the vehicles category and also for refined petroleum oils under the mineral fuels including oil category.
Luxembourg Export Companies
Seven corporations based in Luxembourg rank among Forbes Global 2000, including the bank Espirito Santo Financial. Below are the other major Luxembourg companies that Forbes included.
- ArcelorMittal (iron, steel)
- Millicom International (telecommunications)
- RTL Group (broadcasting, cable)
- SES (broadcasting, cable)
- Tenaris (oil services, equipment)
- Ternium (iron, steel)
Wikipedia also lists companies from Luxembourg, many of which are significant international trade players.
- Brasserie Nationale (brewery)
- Cargolux (cargo airliner)
- Ceratizit (hard metals)
- ROTAREX Group (medical equipment)
In macroeconomic terms, Luxembourg’s total exported goods represent 19.5% of its overall Gross Domestic Product for 2020 ($70.7 billion valued in Purchasing Power Parity US dollars). That 19.5% for exports to overall GDP in PPP for 2020 compares to 24.7% for 2019. Those percentages suggest a relatively decreasing reliance on products sold on international markets for Luxembourg’s total economic performance albeit based on a short timeframe. Please note that those metrics include a significant amount of re-exporting activity.
Another key indicator of a country’s economic performance is its unemployment rate. Luxembourg’s unemployment rate was 6.3% in February 2021, up from 6.1% one year earlier according to Trading Economics.
Luxembourg’s capital is Luxembourg City.
See also Luxembourg’s Top Trading Partners and Top EU Export Countries
Central Intelligence Agency, The World Factbook Europe: Luxembourg. Accessed on April 3, 2021
Forbes Global 2000 rankings, The World’s Biggest Public Companies. Accessed on April 3, 2021
International Monetary Fund, Exchange Rates selected indicators (National Currency per U.S. dollar, period average). Accessed on April 3, 2021
International Monetary Fund, World Economic Outlook Database (GDP based on Purchasing Power Parity). Accessed on April 3, 2021
International Trade Centre, Trade Map. Accessed on April 3, 2021
Investopedia, Net Exports Definition. Accessed on April 3, 2021
Wikipedia, Gross domestic product. Accessed on April 3, 2021
Wikipedia, List of Companies of Luxembourg. Accessed on April 3, 2021
Wikipedia, Luxembourg. Accessed on April 3, 2021
Wikipedia, Purchasing power parity. Accessed on April 3, 2021