Bettel government enjoys confidence
(CS) While Luxembourg business leaders feel that the government under Prime Minister Xavier Bettel lacks some experience, they also believe that it will be more open and transparent, the most recent Luxembourg Business Compass survey has found.
For the survey, the Allensbach Institute in Germany polled 73 top decision makers at Luxembourg's most important companies.
A small majority of 51 percent said that it has great confidence in the triple alliance between the DP, the LSAP and “déi Gréng”. Around a third even said they have more confidence in the new government than the old one, compared to 48 percent who said that confidence in the government was the same.
Comparing the Juncker and Bettel governments, the CEOs, CFOs and other senior members of management stated that they expect openness towards reforms and innovation, transparency and how the government handles the budget to get better.
At the same time, respondents expressed that the new coalition lacks expertise on economic and financial issues, and international affairs, as well as the ability to represent Luxembourg interests internationally.
Negative impact of VAT increase
Only a small majority of 51 percent meanwhile is happy with the current budget situation, with 46 percent saying they are unsatisfied.
Plans to increase VAT left the business community split, with 44 percent saying it is a step in the right direction, compared to 45 percent who said that it will not solve national budget problems. At the same time, 52 percent expect the 2 percent VAT increase to have a negative impact on their business.
Still, it looks like the government is on the right track, as 41 percent think it has managed to strike the right balance between reducing the deficit and stimulating the economy.
More stability after elections
April 2014 also marked a return to more political stability. While in October 2013, 55 percent of business leaders felt that the political environment had gotten worse over the past two years, the new year saw this number drop to 19 percent – the lowest in two years.
Respondents were also less pessimistic about the social environment, with only 17 percent saying it had gotten worse, compared to 43 percent during the last survey half a year ago.
The Luxembourg Business Compass is a bi-annual study commissioned by KPMG Luxembourg. It polls business owners, CEOs, COOs, CFOs or other senior management employees among Luxembourg's top companies by contribution to GDP and staff numbers.
The results of the April 2014 edition will be presented in full at an invitation-only event hosted by KPMG on May 13.