## Luxembourg: Staff Report for the 2004 Article IV Consultation

_IMF Staff Country Reports, May 5, 2004_

## Source details

**Canonical URL:** [Luxembourg: Staff Report for the 2004 Article IV Consultation](https://www.imf.org/en/publications/cr/issues/2016/12/30/luxembourg-staff-report-for-the-2004-article-iv-consultation-17374)

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## Bibliographic details
- Published: May 5, 2004
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9781451824322.002

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### Executive summary
- Authorities are adjusting policies to a growth slowdown; major new initiatives are on hold in the run-up to the June 2004 general election.
- Tax cuts, high expenditure, and weak activity are estimated to have caused a general government deficit in 2003.
- Executive Directors welcomed indications that real GDP growth is rebounding following an unusually long period of sluggish activity.
- Executive Directors stressed that medium-term growth prospects are now less buoyant in comparison with the exceptional growth performance of the past decade.

### Key findings and assessments
- Policy stance:
  - Adjustment to growth slowdown is underway, but significant policy initiatives postponed because of the June 2004 general election.
- Fiscal outcomes:
  - Tax cuts, high expenditure, and weak activity are estimated to have caused a general government deficit in 2003.
- Growth outlook:
  - Indications of a rebound in real GDP growth have been welcomed.
  - Medium-term growth prospects are assessed as less buoyant than the exceptional performance of the past decade.
- Institutional and sector focus areas (as listed):
  - Economic sectors, Expenditure, Financial sector, Income, Labor, National accounts, Pension spending, Wages.

### Policy implications and recommendations (as reflected in the report)
- Continue policy adjustment to the growth slowdown while managing fiscal pressures arising from tax cuts and high expenditure.
- Delay major new initiatives until after the June 2004 general election to preserve policy flexibility during the electoral period.
- Monitor the rebound in real GDP growth and reassess medium-term growth-supporting policies given a less buoyant outlook relative to the previous decade.

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_Source: https://www.imf.org/en/publications/cr/issues/2016/12/30/luxembourg-staff-report-for-the-2004-article-iv-consultation-17374_