Are AI technologies overhyped or a real economic opportunity? This question took centre stage at the  held at the Chamber of Commerce on 24 March. The event brought together leading business and political leaders, tech innovators and bold thinkers to dive into the impact of AI on our economy.

This unique event--organised by the ministry of the economy, the Chamber of Commerce, Idea and the Fedil, in cooperation with PWC Luxembourg--once again proved itself as the place for forward-thinking dialogue on the opportunities and challenges that lie ahead for our economic players.

In my opening address, I took the opportunity to highlight the active engagement of the Chamber of Commerce on the strategic topic of AI, in close collaboration with business leaders, the research community and representatives of the public sector. Our working group on AI is currently drafting concrete recommendations to accelerate the development and deployment of AI across all sectors, to position Luxembourg as a major European AI hub. On the ground, our House of Entrepreneurship is already helping SMEs in their adoption of AI. Just two weeks ago, we in collaboration with Luxinnovation and the ministry of the economy.

I also underlined the central role of the state in the development and adoption of AI at a large scale in Luxembourg. In fact, it is key for the public administration to lead by example, prioritising national and European solutions that fuel our local ecosystem and to safeguard our sovereignty. Looking ahead, the upcoming national AI strategy as well as the will mark important milestones on Luxembourg’s AI journey.

Time to act to unlock the potential of AI for Luxembourg’s economy

Whether AI is perceived as a revolution, or the evolution of a technology dating back from the 1950s, what truly sets today’s advancements apart is the unprecedented amount of accessible data, computing power available and the possibility for everybody who has internet access and a device to interact with a so-called “artificial intelligence.” Hence, AI is becoming more accessible, interactive, and embedded in everyday digital tools, reshaping how we work, create and solve problems. These new dimensions are unlocking capabilities that were previously out of reach--creating real and significant economic opportunities across industries.

A study published in 2024 by the Implement Consulting Group on the economic opportunity of AI in Luxembourg highlights the urgency, showing that timely adoption of AI technologies could lead to significant productivity gains for Luxembourg. The message is clear: now is the time to act if we are to fully seize this opportunity. According to our latest Baromètre de l’Economie, 63% of the companies that believe their business model will be impacted by emerging technologies plan on investing in AI in the next three years. A widespread use of AI by companies has the potential to radically transform industries, streamline operations, and unlock new sources of growth and innovation.

Exploring the potential of AI: four priorities highlighted by our working group on AI

Our working group on AI has carried out extensive work on the topic over the past six months, in close cooperation with key actors from the national technological ecosystem. The Journée de l’Economie was the occasion to present preliminary conclusions to a wider public in exclusivity.

First, there is a clear need to increase and diversify investment sources. The puts forward the widening gap in GDP between the European Union and the United States, largely explained by an innovation gap, especially in advanced technologies. Closing this gap with the US and China is vital for Europe to ensure sustainable growth and to become more productive. The funds allocated are in line with the economic and geostrategic stakes of AI. In the United States, the launch of “The Stargate Project” in January aims to build a $500bn AI infrastructure.

To secure its place on the AI and technological world map, Europe must take bold and decisive action. The EU InvestAI initiative launched in February by European Commission president Ursula von der Leyen is an important step forward. . French president Emmanuel Macron announced €109bn euros in “French and foreign private investments” in AI. It will be key to ensure coordinated initiatives at the EU level in order to minimise market fragmentation.

In Europe, innovative digital companies struggle to scale up and secure funding, leading to a significant disparity in later-stage financing compared to the US. In this context, diversifying funding sources and unlocking private investment are crucial to rapidly foster innovation and growth. For innovative companies looking to scale up in Europe, access to a broad range of financing options--including private equity and venture capital investments--is essential to compete globally and drive technological progress. The by ministers (DP) and (CSV), marks an important step forward for Luxembourg’s innovation ecosystem. With concrete, founder-focused measures--from tax incentives and dedicated support for spinoffs to the launch of a one-stop talent desk--the plan aims to turn ambition into action. Backing this momentum, the SNCI will inject an additional €300m over the next five years to support startup growth and drive innovation across the country.

With its strong financial expertise and international workforce, Luxembourg has the potential to attract international capital and to increase its market share in the business flow of companies establishing themselves in Europe. Measures such as facilitating investments of individuals in private equity and venture capital and introducing a tax shelter for investments made by individuals in startups active in AI should certainly be implemented.

Second, on the regulatory side, we should take the opportunity of the AI Act implementation in Luxembourg to promote innovation. This includes setting up an ecosystem of competent national authorities that are outstanding in accompanying companies, alongside a pragmatic regulator that adopts a business-friendly approach tailored to guiding and empowering businesses. Additionally, Luxembourg should establish attractive regulatory sandboxes, positioning itself as a leading European testing hub. These are tools that the AI Act provides to reduce regulatory barriers when bringing new AI products to the markets. With an ambitious sandbox plan, Luxembourg can become the entry point for third-country companies looking to establish themselves in the EU and to test the compliance of their AI products in a supervised environment.

Third, Luxembourg must fully leverage on the existing and future infrastructure to position itself as an AI Hub. Businesses must capitalise on Meluxina, Luxembourg’s high-performance computer to develop sovereign and scalable AI solutions at both the national level and across the Benelux region, and even Europe. However, it remains crucial for the Luxembourg government to continue investing in computing and data infrastructure in the long term while securing its supply chain for strategic components, such as graphics processing units (GPUs).

Thanks to its sovereign and secure infrastructures and solutions (such as sovereign clouds or Tier IV data centres), Luxembourg offers a solid foundation to focus on sectors handling highly sensitive data, such as banks, investment funds and health providers. Moreover, it is important to strategically define sectors in which Luxembourg could establish its AI leadership. The four areas selected within the framework of the AI Factories--finance, space, green economy and cybersecurity--are strategic choices which should be supported at the national level. Once again, the public sector must set an example in the adoption of AI and can fully benefit from existing secure and sovereign infrastructures. Beyond this, defence must also be a priority for Luxembourg. Closely linked to space (for example: Earth observation) and cybersecurity, the country already has a foundation of expertise in this field.

Finally, it is crucial to adopt a communication strategy focused on establishing Luxembourg as an AI Hub. The strategic positioning of the space sector serves as a benchmark. In its early days, communication initiatives were based on embryonic foundations. In ten years, numerous companies, including startups, have established themselves and/or grown in Luxembourg thanks to a visionary approach. Against this background, the adoption of a nation branding strategy around the Luxembourg AI Hub should be a priority for the country with a clear focus on key dimensions of AI, notably the legislation, infrastructure and the ecosystem.

Moreover, it is of utmost importance to strengthen the presence of Luxembourg in international networks by participating in trade fairs and exhibitions or collaborating with AI hubs worldwide.

At the Chamber of Commerce, we recognise AI’s growing influence and its capability to have a significant impact on our society. We are committed to advancing our work in the coming months on this strategic topic for Luxembourg’s economy. At the national level, it is essential that our ambitions are high to ensure our presence on the international AI stage. To quote the famous poet, essayist and playwright T.S. Eliot, “Only those who will risk going too far can possibly find out how far one can go.”

* is director general of the . We are publishing his guest contribution, available on  with his permission.