Worst-case scenarioLuxembourg's public debt could reach 223% of GDP by 2070

RTL Today
The National Council of Public Finances has projected that Luxembourg’s public debt could range from 70% to a staggering 223% of GDP by 2070, depending on various economic and demographic factors.
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The estimates, based on data from the EU Commission, highlight the potential impact of an ageing population and rising costs.

The long-term analysis reveals how even minor changes in assumptions could lead to significantly different outcomes.

In a worst-case scenario, with the population reaching 976,000 by 2070 and economic growth averaging 1.7% annually, public debt could climb to 223% of GDP.

On the other hand, if the population grows to 1.3 million and the economy expands by 2.6% per year, debt would stand at 70% of GDP. Pension system costs are another variable that could shift the results.

The National Council of Public Finances notes that future governments are likely to take steps to counter negative trends. However, even in the most favourable scenario, debt would still far exceed the previous government’s goal of keeping it below 30% of GDP.

The current coalition between CSV and DP has acknowledged the need for flexibility, with their agreement stating that the objective is to establish a sustainable debt trajectory.

Read also: Luxembourg has third-lowest public debt rate in the EU

Read the document in full (PDF, in French)

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