Pierre Gramegna (Minister): a view on Luxembourg’s future
Meeting Pierre Gramegna, Luxembourg's Finance Minister, was the perfect occasion to highlight some initiatives within the financial sector and to look at the country’s future.
In April, the first conference dedicated to private equity and venture capital, held in the Philharmonie, was a big success. What is your view of this industry?
I would like to congratulate the organisers of “360Insights GP View” for putting together the first conference dedicated to this branch of our financial industry, because private equity and venture capital are becoming increasingly important in Luxembourg. The benefits of being in Luxembourg are obvious: the top 10 private equity firms are present here and 80% of all private equity investments use Luxembourg-based structures. It seems that we have the right framework for this sector, which probably explains the success of the conference at the Philharmonie.
« Creating a green economy is key to making Luxembourg even more appealing to international investors.»
You often say that you have two priorities when it comes to diversifying the financial sector in Luxembourg: FinTechs and the green economy. How do you promote FinTechs?
FinTechs have become very important for the Luxembourg financial sector and this is why in April, a new foundation was launched: the Luxembourg House of Financial Technology (LHoFT). The idea is to bring together the public and private sector, start-ups, small players and established players of the financial world. All this happens in a co-operative manner, which is probably the key feature of this new sector. The digitalized economy is much more based on the spirit of co-operation than on competition.
I am pleased to announce that the LHoFT already received 50 requests of FinTechs willing to settle down in Luxembourg. I am sure that the LHoFT will be as much a success as other infrastructures that already exist in London, Australia and Canada, just to mention some of the countries where I visited comparable projects. In fact, all these places have shown real interest in creating connections and are already in touch with the LHoFT. Just like the Luxembourg economy, the FinTech ecosystem is open to the world.
What about the green economy?
This is the second priority that I would like to highlight: climate finance. Last year, the Luxembourg government signed a memorandum of understanding with the European Investment Bank and the European Investment Fund to set up a climate change platform to co-invest in projects that have a positive impact on the environment. The reason of this commitment is the aim to achieve the goals set at the Paris conference and the intention to set a milestone. There is no better way for Luxembourg to fight against climate change than to use its best leverage, the financial center. We have also taken part in another initiative: the Green Cornerstone Bond Fund (GCBF), set up by the International Finance Corporation, a body of the IMF. It is a $2 billion initiative to foster green projects in emerging countries. Luxembourg is a strategic partner of this initiative, which will also be managed from Luxembourg. A few months ago, Luxembourg launched a new stock exchange, which exclusively lists green and sustainable bonds. The « Green Stock Exchange » encourages other initiatives by players of the private sector. I really believe that creating a green economy and encouraging green finance is key to making Luxembourg even more appealing to international investors.