countries regarding inflation at 2.0% as a high proportion of goods and services consumed in Luxembourg is imported, most of this increase reflects trends in inflation in other countries and the depreciation of the euro.
             Over the past decade, real economic growth in Luxembourg has been some 1.5% higher than growth in the EU (12) and even than that of its three main trading partners: France, Germany and Belgium. This growth is the fruit of a successful economic policy and is expressed in the restructuring of the steel industry, the boom in the financial sector, industrial diversification and the emergence of some new service activities. Luxembourg's macroeconomic balance shows a series of generally positive indicators, which are the result of this policy.
             The restructuring of the steel industry started in the second half of the 1970s, continued in the 1980s, particularly through direct financial aid from the government. At the beginning of the 1990s, after having made major investments increasing labour productivity still further, ARBED concluded synergy agreements with French and Belgium partners, which enabled the Luxembourg steel-makers to take advantage of substantial economies of scale on the national site.
             The local banks, which came to Luxembourg on account of the favourable legal framework (complete freedom of capital movements, lack of a central bank, favourable prudential regulations and flexible tax arrangements) turned their attention to private banking after 1982.
             The industrial diversification policy was continued and limited the decline of industrial fabric. Between 1985 and 1993, industries other than the steel industry created an average of 450 net jobs per year, although total employment in industry fell by an annual average of 300 people.
             The present economic excellent macroeconomic situation is the outcome of an enterprising, realistic and far-sighted economic policy. Even though Luxembourg's ...