HSS Dialogue Programme in Luxembourg for Young Leaders
Europe's “Number Three”

The Court of Justice of the EU in Luxembourg.

Court of Justice of the European Union

Robert Schuman is widely regarded as the founding father of the European Union as we know it today. As French Foreign Minister, he outlined in a speech a vision for European integration that entered the history books as the “Schuman Plan”. Schuman embodies the story of European unification not only through his forward-looking speech, but also through his own biography. Born in Luxembourg, young Schuman did not learn French at home, but Luxembourgish – that distinctive language, formally codified only in recent decades, which resembles Central German with French influences.

With its history and location as a border region between France and Germany, the Grand Duchy of Luxembourg has close cultural ties with both neighbours. Economically too: even today, many Luxembourgers and diplomats cross the border to shop in nearby Trier. 

Since the end of the war, the Grand Duchy has developed into an important European financial centre, thanks to a “tax-optimised” economic model. More than 10,000 EU officials also work in the typically tranquil Grand Duchy. Why Luxembourg, of all places?

The delegation met the Vice President of the Court of Justice of the EU.

Timon Ostermeier/HSS

Seizing the Moment

Luxembourg’s role as one of the EU’s three official seats can be attributed largely to chance and the timely initiative of the Luxembourgers themselves. As a co-initiator of the European Coal and Steel Community (ECSC), tiny Luxembourg – with its mere 680,000 inhabitants – was one of the six founding members of the European Union. But how exactly Luxembourg came to serve as an institutional base alongside Brussels (Commission and Council) and Strasbourg (Parliament) is a matter of differing accounts. Many Luxembourgers say it was obvious from the outset that the ECSC needed a court – and so they seized the moment.

Another explanation highlights pragmatic considerations: the new ECSC urgently required office space, which Luxembourg was able to provide quickly. Luxembourg also occupied a neutral mediating role between the two “hereditary enemies”, France and Germany. Especially in the aftermath of the Second World War, it was seen as a compromise that the Court of Justice and a “High Authority” were not located in Bonn or Paris. The “High Authority”, later the “Commission”, eventually moved to Brussels; some branches, including the Court of Justice, remained in Luxembourg. 

Over time, further institutions such as the European Investment Bank and the Court of Auditors joined them.

With President Claude Wiseler (third from right) in the Chamber of Deputies in Luxembourg.

Timon Ostermeier/HSS

Mining in Outer Space

“Luxembourg faces budgetary and domestic policy debates similar to those in Germany,” says Maurice Bauer of the Christian Social People’s Party of Luxembourg (CSV). Although the country experienced a strong boom through the financial sector, pensions, housing and the cost of living are contentious issues here too. The Luxembourg financial sector is also heavily dependent on the United States.

But future technologies offer new prospects: the country has a traditionally strong sector in satellite construction and communications services. These are becoming increasingly important in military terms as well. Additional growth sectors include drones and companies involved in “space mining” – the future extraction of raw materials in outer space.

Labour migration has long been a key economic factor for the country, which is also experiencing a marked demographic decline. This includes not only cross-border commuters from Germany and France. Luxembourg has actively encouraged immigration in the past and once concluded a guest worker agreement with Portugal, similar to Germany’s agreement with Turkey. Unsurprisingly, Portuguese is the most spoken language after the three official languages (Luxembourgish, French and German). Indeed, Luxembourg is so international that only around a quarter of its residents are native Luxembourgers. “We need immigration,” says Parliamentary President Claude Wiseler, who is married to a Portuguese woman.

Languages and internationalism are, in fact, the country’s greatest strengths. Luxembourg’s higher education system requires students to spend part of their studies abroad. Many go on to pursue international careers.