Luxembourgh Times

Quick bounce for Luxembourg after pandemic, OECD says

The country's GDP rose by 4.9% in the first three months of this year compared to 2020, according to statistics agency Statec

© Photo credit: CFL

Luxembourg will rapidly make up the economic losses it suffered during the Covid-19 pandemic, the latest OECD forecasts showed, with the country heading for the third-fastest recovery in the European Union.

Luxembourg's economy had contracted just 1.3% in 2020, partially because its crucial financial industry could largely continue to function as normal by allowing staff to work from home, in contrast to the manufacturing sector where teleworking is often less of an option.

The OECD, a club of 38 wealthy economies, said it had gradually become more optimistic about the global recovery from the coronavirus pandemic, as vaccination programmes proceeded, governments had supported the corporate sector with taxpayer money and companies adapted.

"Economic forecasts now look more promising than they ever have since the start of this devastating pandemic", OECD Secretary General José Angel Gurria was quoted as saying in a press release.

Luxembourg's economy grew 4.9% in the first three months of this year compared to the same period last year, Statec said in a press release on Monday. The country's resilient job market, which saw unemployment drop to 6.1% in April from 6.9% a year before, is confirming the positive trend.

However, OECD members will reach their 2019 GDP at different paces. While Germany will make up for the pandemic-induced drop at the end of this year, France will not be able to say the same until the end of 2022.

Others are faring worse still, with Spain forecast to recover from the pandemic by mid 2023, the slowest recovery in the EU, according to the OECD.