Luxembourg's National Recovery and Resilience Plan: Latest state of play

Briefing 18-09-2023

Luxembourg's National Recovery and Resilience Plan (NRRP) was initially to be financed by the Recovery and Resilience Facility (RRF) with a total of €93.4 million in grants. This allocation accounted for around 51 % of the total estimated value of the Luxembourgish NRRP (€183.1 million). A further 46 % of the costs are to be covered by the national budget, and 3 % from other EU co-financing. Under the RRF Regulation, Member States can request RRF loans until 31 August 2023; Luxembourg has not done so. It is expected to submit a REPowerEU chapter and has decided to transfer €128.5 million from the Brexit Adjustment Reserve to the RRF to finance it. On 30 June 2022, the European Commission recalculated the maximum grant amounts for each country. For Luxembourg, this cut the total to €82.7 million; the country updated its NRRP, removing one investment. The estimated total cost of measures under the NRRP is now €88.4 million, or €5.7 million more than the new allocation. The difference will be financed through the national budget. Luxembourg's RRF allocation is not only the smallest in the EU in absolute figures but also the lowest as a share of grants, both in relation to gross domestic product (GDP) (0.13 % of GDP in 2019) and per capita (€26 per citizen). Luxembourg has so far received €32.4 million of RRF grants (in pre-financing on 3 August 2021 and a first payment on 16 June 2023). The NRRP aims to address Luxembourg's structural issues, aggravated by the pandemic. The measures included complement and build on priorities laid out in the national economic stimulus package from May 2020 (i.e. the Neistart Lëtzebuerg programme). The central objective is to support social cohesion and the promotion of a modern and attractive economic environment, while responding to climate and environmental challenges. With 68.8 % of the funds allocated to climate objectives and 29.6 % to the digital transition, the NRRP will contribute to common European efforts in these areas. The climate and environmental policy guidelines in the NRRP are consistent with Luxembourg's integrated national energy and climate plan (NECP) for 2021-2030. The Luxembourgish NRRP's components relating to skills, health, housing and governance also support cohesion and growth potential significantly in the long term. This briefing is one in a series covering all EU Member States. Third edition. The 'NGEU delivery' briefings are updated at key stages throughout the lifecycle of the plans.