Major Blunders

Luxdefence, the association representing companies active in the defence sector, has warned that Luxembourg is missing out on major investments due to difficulties faced by companies trying to establish themselves. According to president Andre Wilmes, the sector still faces a number of difficulties despite having 140 members after around a year of existence.

One of the key problems is that defence companies struggle to open bank accounts. Wilmes described the situation as "catastrophic", acknowledging that defence remains a relatively new area for banks, accountants, and insurers. "They have not dealt with many defence clients before," he said, adding that he could understand why the adjustment was taking time. But the problem is hampering efforts to turn planned projects into reality.

100 million euros lost

The damage to Luxembourg's reputation has already been done. Within the relatively small international defence industry, word of such experiences spreads quickly. Wilmes said there had been "some really major blunders", including cases where companies were unable to open bank accounts or even had existing accounts closed. In some instances, this happened despite investments worth tens of millions of euros being "ready to come to Luxembourg".

Across several cases, Luxembourg had missed out on investments totalling "slightly more than 100 million euros", he added. "Those are considerable amounts for a market like ours." Wilmes said there was a regrettable gap between the government's official messaging on the sector and the reality on the ground. If projects run into difficulties when it comes to implementation, "the two simply do not match up, and that is not good."