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Working Paper No. 39 – Financing Luxembourg’s Defence Industrial and Technological Base

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Strengthening Luxembourg’s Defence Industrial and Technological Base (LDITB) is one of the pillars of the national defence strategy. With Luxembourg’s defence expenditure expected to rise from €464 million in 2021 to nearly €1.66 billion in 2029, against the backdrop of a European defence market already worth €454 billion in 2026, the challenge is both to support projects undertaken by established players and to foster the emergence, attraction and growth of innovative start-ups.

In this context, the development of the LDITB would benefit from moving beyond merely meeting national capability requirements towards building an internationally competitive industrial ecosystem at the European level. The LDITB comprises 122 organisations operating in areas such as space, cybersecurity, advanced materials and autonomous systems.

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