Agefi Luxembourg - janvier 2025

Janvier 2025 13 AGEFI Luxembourg Economie / Banques ByAndrei RADULESCU, SeniorMacroeconomist T he year 2024 was characterised by a complex international context, dominated by themul- tiple confrontations, trade, technologi- cal, andmilitary (Ukraine, Middle East), generating divergences bet- ween the real and financial sides of the economy, and also among themain economies in the world. It was another year of the Challenging 20s defined by the huge gap between the rhetoric and reality (including the per- spectiveofthetransitiontowards green economy), the persistence of theuncertaintyat ahigh level (alsogiven theelectoral context), the continuity of the upward trend for the publicdebt/GDPratio,andintensifyingeconomicin- tegration among the emerging and developing economies. On the one hand, the year 2024 was positive for the financial side of the economy, with the stock markets trading at record high levels, the MSCI AllCountry Index increasingbymore than15%, according to the platformInvesting.com. This evolutionwas supportedby several factors, including the increasing resilience of the compa- niesandhouseholdstothepersistenceofthegeo- political tensions, the incorporation of the technological progress (the Digital Revolution, and Artificial Intelligence Revolution), and the slowing-downof the inflationarypressures, that determinedthecentralbankstoinitiateacycleof interestratescutting,andtosignalthecontinuity of this cycle in the coming quarters. Therecanbenoticedtheperformanceofthestock market in US (with S&P 500 up by more than 23%in2024), anevolutionalso supportedby the results of the Presidential elections. On the otherhand,therealsideoftheworldecon- omy continued to increase by aweakpace in2024,anevolutiondeterminedbyseveral factors, including the high level of uncer- tainty (determined by the persistence of the geo-political tensions), the trade confronta- tion among the largest economic blocks, and the high level of the real financing costs. The figures recently publi- shed by the Netherlands Bureau for Economic Policy Analysis (CPB) show the increase of the volume of the international trade with goods and of the volume of the world industrial production by weak average annual paces, of 1.4%, and 1.7%, respec- tively during January – October 2024. Consequently, the gap between the climate on the stockmarkets and the evolutionof the real economic activitywidenedin2024,asreflectedbythefollowing chart ( Figure 1 ). Furthermore,in2024therecanbealsono- ticed the divergence among the largest economic blocks in the world, with the economy of the European Union being the looser of the global races, due to the structural challenges, namely competi- tiveness and convergence. For instance, according to the CPB statis- tics, the volume of the industrial produc- tion grew by an average annual pace of 5.6%inChina,while it contracted inUSA andEurolandbyaverageannualdynam- ics of 0.3%, and 3.1%, respectively during January –October 2024, as canbe noticed in the following chart ( Figure 2 ). AsregardsthedynamicsoftheGDP,there can be noticed the consolidation of the annual growth pace in USA (the largest economy in the world, with a nominal GDP of over USD29.3tn in 3Q2024) around its potential in 2024. The so-calledUS exceptionalismwas determined by the dynamics of the fixed investments (annual pace abovethatoftheprivateconsumptionforthe5thquar- ter in a row in 3Q 2024, according to the estimates of BureauofEconomicAnalysis),giventhepositive climate on the financial markets, and the incor- porationof the technological progress. At the same time, the prospects for the conti- nuity of the cycle of interest rate cut by the Federal Reserve and the prospects for the improvement of the real disposable income in the coming quarters (in the context of the slo- wingdown inflationarypressures) contributed to the consolidation of the annual growth pace in USA around its potential last year. In China (the second largest economy in the world, with a nominal dimension estimated at aroundUSD18tn in2024) the economic activity grewbyanaverage annual pace of 4.8%during 1-3Q 2024 (close to the target of 5% set by the policymakers for 2024), anevolution supported by the dynamics of the investments (the invest- ments in fixed assets excluding real estate grew by anaverage annual paceof 7.7%for the first 9months of 2024, according to the estimates of the National Bureau of Statistics of China). On the other hand, the economy of the European Union increased by an average annual pace of below 1% in the period January – September 2024, according to the esti- mates of Eurostat. Attheendofthisanalysis,Ipointouttheslightimpro- vement of the world economy at the end of 2024, as reflected by the increase of the PMI (Purchasing Managers Index) Composite indicator in December, to the highest level since themonth ofAugust, accor- ding to the statistics of S&PGlobal. This evolutionwas influencedby thepositive climate on the international financial markets and the prospects for the economic policy mix in the largest economic blocks in theworld in the coming quarters (the focus on investments in new technologies and productivity). However, the risks, challenges, anddivergences per- sisted at high levels in the world at the end of 2024, being needed more than ever a new BrettonWoods momentum, as happed in the Summer of 1944. 2024 – the Year of Divergences in theWorld Economy Figure 1.MSCIAll Country Index vs. Index of the World Industrial Production (August 2004 = 100) Source:representationoftheauthorbasedonthedataofInvestig.comandNetherlandsBureau forEconomicPolicyAnalysis(CPB),January2025 Figure 2. The evolutionof the Industrial Production (MA12, YoY) Source: representation of the author based on the data of the Netherlands Bureau for Economic PolicyAnalysis (CPB), January 2025 PrimeMinister Luc Frieden andCSUParliamentaryGroupChairmanAlexander Dobrindt, MP (Bundestag) in SeeonAbbey, Bavaria on January 7, 2025 “We want stable finances in Europe” P rimeMinister Luc Frieden gave a speech on the challenges of tomorrow's Europe, along- side CSUParliamentary GroupChairmanAlexander Dobrindt, MP (Bundestag), on January 7, at the CSU's annual retreat in Bavaria. Fivemain excerpts (1) 1. MPAlexanderDobrindt: There are currently suggestions in Eu- rope to go massively into debt. Mario Draghi has published a re- port,whichareworthconsidering. But there is a dramatic mistake in it, namely that hewants to go into a high new debt, that he argues that Europe shouldaccept 800bil- lion euros in newdebt every year. Wearemassivelyagainstthisdebt policyinEurope,becauseitwould onlynecessarily lead tousputting the euroat riskandultimatelyput prosperity at risk. Wewant stable finances inEurope and thatwith- out horrendous newdebts. 2. PrimeMinisterLucFrieden :… dear Alexander Dobrindt, thank you very much for the invitation here to Bavaria. These elections that are coming up on February 23rd are not only important for Germany, they are important for thewhole of Europe, because ev- erything that happens in Ger- manyhas a consequence for the rest of Europe . And also the other way around, European politics is always an important part of the internal politics of the member states of the European Union. And that is why, for me as prime minister of a neigh- bouring state, a country that strongly believes in European unification, because it allows us tomaintainpeace, freedomand prosperity for the long term . And that iswhy it is important to talk to our neighbours. 3. Luc Frieden : … we will be more competitive in Europe if we have a competitive advan- tage over America and others . This can possibly become even stronger under President Trump. 4. Luc Frieden : This terrible attack byRussiaonUkraineismorethan just an attack on Ukraine. And that’s why we have to invest in our defense . We have to not only invest in defense, but also coordi- nate our actions in security issues. And that’s why the voice of Ger- many is very important, because it’s about guaranteeing freedom and security in Europe. This also applies to internal security. Every countryhasspecificsituations,but without security, where we live, there is no freedom. 5. Luc Frieden :Andhere, too, we can only hope that the internal problems in the individualmem- ber states of the European Union can be strengthened in terms of internal security. And all of this together, of course also an impact on the functioning of our democ- racy. And I am firmly convinced that as head of government of a stable majority in a democracy, that democracy is not strength- ened when the extreme parties win in success . On the contrary, that may look democratic at the beginning, that ends, as history has taught us, mostly with less democracy, less rights and less freedom. And that is why I hope that in Germany, and that is the choice of the Germans, of course, that a strong policy, that is re- sponsible, that supports democ- racy,freedomandprosperity,will emerge on February 23rd in the interest of Europe. (1)“Dobrindt/Frieden:VielzutuninEuropa! Mit Luxemburg an der Seite”, Pressestate- ment mitAlexander Dobrindt MdB, Vorsit- zender der CSU im Bundestag und Luc Frieden, Premierminister von Luxemburg auf der Winterklausur in Seeon, 7.1.2025 https://www.youtube.com/watch?v=3CKHwqC EUJA&t=470s (freetranslationGerman/English) ©AlexanderDobrindt La présidence du Benelux passe au Luxembourg P our les deux prochaines années, la Chambre des Députés du Luxem- bourg assurera la présidence de l’As- semblée parlementaire du Benelux. La députée Francine Closener dirigera les tra- vaux de cette assemblée composée de 49 membres, désignés par les parlements de la Belgique, des Pays-Bas et du Luxembourg, dont 7 députés luxembourgeois. Qu’est-ce que leBenelux ? Le Benelux regroupe trois pays : le Royaume de Bel- gique, le Royaume des Pays-Bas et le Grand-Duché deLuxembourg.L’acronyme«Benelux»estformédes premières lettresde ces nations (Belgique/België,Ne- derland, Luxembourg). Cette coopération se concentre principalement sur trois axes : 1. lemarché intérieur 2. le développement durable 3. la sécurité (justice et police). LeBeneluxjoueunrôledepionnierauseindel’Union européenne(UE),entestantdesprojetsinnovants.Par exemple,lalibrecirculationdespersonnes,initiéedans le cadre du Benelux, a servi de modèle à l’accord de Schengensignéen1985aveclaFranceetl’Allemagne. Les initiatives qui fonctionnent au Benelux peuvent ensuite être étendues à l’ensemble de l’UE. Focus sur l’IAet Schengen Le Parlement Benelux tient généralement trois séances plénières par an, qui se déroulent dans le pays exerçant la présidence. Durant sa présidence de l’Assemblée parlementaire du Benelux en 2025 et 2026, la Chambre des Députés mettra en avant des thématiques clés, telles que l’intelligence arti- ficielle (IA) et l’accord de Schengen, qui célébrera son 40ᵉ anniversaire en 2025. Par un hasard du calendrier, le Luxembourg as- sure également la présidence de l’exécutif en 2025, au niveau des gouvernements. Le Conseil inter- parlementaire consultatif du Benelux a pour mis- sion d’adresser des recommandations aux gouvernements du Benelux sur des sujets liés à la réalisation et au fonctionnement de l’Union éco- nomique. Les députés se retrouvent également en commis- sions parlementaires. Le Parlement Benelux com- prend actuellement sept commissions : 1. Affaires étrangères 2. Finances et Mobilité 3. Coopération transfrontalière 4. Affaires sociales 5. Santé Public 6. Enseignement 7. Sport. 3mandats pour les députés luxembourgeois Pour les deux prochaines années, la députée Fran- cine Closener présidera l’Assemblée parlementaire du Benelux. Emile Eicher est à la tête de la délégation luxem- bourgeoise auprèsde l’AP-Benelux tandis que ladé- putée Barbara Agostino préside la Commission de l’Economie, Agriculture et Energie. Membres de la délégation luxembourgeoise Chaque commissionest composéede12membres : 5 Belges,5Néerlandaiset2Luxembourgeois.Leurrôle est de débattre et de rapporter à l’assemblée plénière sur des sujets spécifiques, qu’ils soient proposés par leprésident,l’assembléeplénièreouinitiésparlacom- mission elle-même. Source :ChambredesDéputés ©Shutterstock