- Businesses in Luxembourg remain actively engaged in investment activities – 85% invested last year – but total investment level is still 15% below pre-pandemic levels.
- The services and construction sectors remain under pressure, with access to finance expected to worsen.
- Nearly half (43%) of Luxembourgish companies already use generative AI in at least one area of their business.
The European Investment Bank (EIB)’s annual ‘Investment Survey’, which can be downloaded here, shows that although Luxembourgish firms are actively investing, the total investment level in the country is still below pre-pandemic levels. Some 85% of all interviewed companies in the country reported investment activities, but at the same time caution is growing with regard to the future, especially in services and construction, where outlooks are most pessimistic.
“We clearly see the geopolitical challenges that the EU faces reflected in the Luxembourgish business environment.” said Chief Economist Debora Revoltella. “Although outlooks are not as positive as in previous years, Luxembourgish companies remain resilient. Also the high share in terms of adoption of digital technologies is an encouraging sign, showing that the country is still among the innovation leaders of the EU.”
The survey, which covers more than 12,000 EU firms and over 800 US companies polled between April-July 2025, also shows that firms expect access to finance to worsen in the coming times. Compared to the previous EIBIS 2024 survey, more firms anticipate deterioration in both external funding (net balance: -20% vs. -4%) and internal finance (-11% vs. -2%). Despite these challenges, 16% of firms are still optimistic about their business prospects for the next year - well above the EU average.
Also on a more positive note, AI adoption is gaining ground. About 43% of Luxembourgish firms surveyed now use generative AI tools in at least one area of their business, which is above the EU average of 37%. These tools are most used for internal processes (63%), marketing and sales (56%), and customer service (53%).
In terms of barriers to investment, regulatory challenges appear to be rising, with 69% citing new rules and standards as a concern (up from 47% last year and above EU average of 59%). Among importers/exporters, 52% say they are facing customs and tariff issues – more than double the figure of last year and in line with the EU average. Notably, 15% of importing firms are actually reducing imports, versus 7% across the EU.
Survey results feed into the annual Investment Report, the flagship publication of the EIB Group’s Economics Department, gauging the investment outlook for Europe’s economy. The full country report about Luxembourg is available here.
Background information
The European Investment Bank (ElB) is the long-term lending institution of the European Union, owned by its Member States. Built around eight core priorities, we finance investments that contribute to EU policy objectives by bolstering climate action and the environment, digitalisation and technological innovation, security and defence, cohesion, agriculture and bioeconomy, social infrastructure, the capital markets union, and a stronger Europe in a more peaceful and prosperous world.
The EIB Group, which also includes the European Investment Fund (EIF), signed nearly €89 billion in new financing for over 900 high-impact projects in 2024, boosting Europe’s competitiveness and security.