While the world economy has been shaken by the COVID-19 pandemic, Luxembourg has addressed the crisis as an opportunity to renew and strengthen its commitment to becoming a leading, sustainable data economy. “We are convinced that embracing the digital transformation and the green transition towards climate neutrality in 2050 is central, both for relaunching our economy and for positioning Luxembourg in the future,” says Mario Grotz, Director General for Industry, New Technologies and Research at the Ministry of the Economy.

Planting the seeds of innovation

Mario Grotz, Luxembourg Ministry of the EconomyThe basis for the country’s efforts is its holistic strategy for data-driven innovation. “Today, many companies have huge amounts of data, but only a few are using it to its full potential,” Mr Grotz points out. “We want to provide an environment that helps them succeed with all the necessary steps, from digitalising their processes to generating value from their data, and paves the way for entrepreneurs with innovative business models based on data use.”

Today, many companies have huge amounts of data, but only a few are using it to its full potential.

Luxembourg’s digital infrastructure, which is already outstanding in terms of connectivity, cybersecurity expertise and secure data storage capacities, is being further boosted, by the business-oriented high performance computer (HPC) that opened its doors in spring 2021. Companies are encouraged to experiment and innovate with advanced digital technologies such as artificial intelligence and the internet of things via national and European support platforms, testbeds and regulatory sandboxes.

The government also aims to establish a strong regulatory, intellectual property, investment and financing environment. “We want to make sure that regulations keep pace with emerging digital opportunities, and ensure an innovative regulatory environment in the area of cybersecurity, in order to enable trusted data-driven services,” says Mr Grotz. “We also intend to complement current R&D and innovation incentives and public-private research partnerships with best-in-class digital investment funds and other financing mechanisms.”

Fertile ground for growth

David Foy, Luxinnovation, supports international companies interested in the Luxembourg data economyThe outcome of the efforts is a comprehensive data ecosystem that already provides a solid foundation for Luxembourg’s ambition to become Europe’s most trusted data hub. It includes all the most central components, such as a national cybersecurity centre, centralised data lakes, research institutes and world-class infrastructure, which are conducive to innovation.

“The ecosystem has many individual strengths, but it is the unique way that Luxembourg combines these strengths that becomes our real value proposition,” says David Foy, Head of International Business Development – Data Economy at Luxinnovation, the national innovation agency, who likens the ecosystem to a tree. “Not all branches or twigs are relevant to everyone, but they are all intertwined to provide a seamless customer experience. Local companies are encouraged to explore digital transformation to address changing market dynamics, and foreign businesses find a fertile ground for their European market entry.”

The ecosystem has many individual strengths, but it is the unique way that Luxembourg combines these strengths that becomes our real value proposition.

Appetite for more

According to Mr Foy, Luxembourg’s appetite to remain on the cutting edge of innovation is key to the launch of new initiatives such as the government-initiated GovTech Lab, the Luxembourg Institute of Science and Technology’s research project aimed at creating a digital twin of the whole country or the HPC. Next comes the creation of a fully functioning data market.

“I’m convinced that if Luxembourg can render data from multiple sources accessible and usable whilst guaranteeing data protection and personal privacy, we can offer businesses a real opportunity to generate value and build a new backbone of our economy,” says Sasha Baillie, CEO of Luxinnovation. “If we set up a national data exchange platform and carry out digital twin projects, Luxembourg could become the place where data solutions are developed and tested in a safe, secure environment with access to world-class technology.”

The national data exchange platform would ensure that data from various producers of data – public bodies, companies and research organisations – would be usable, interoperable, accessible, reliable and compliant with privacy regulations. The consumers of such data could be entrepreneurs and innovators, policy makers and research institutes. The platform would also guarantee proper data governance and help establish fair contracts between producers and consumers.

Luxembourg is also actively involved in GAIA-X, a European initiative aimed at developing common requirements for a European data infrastructure. “Joining GAIA-X offers Luxembourg’s cloud services providers, network providers and data infrastructure entities the opportunity to provide input to defining data infrastructure requirements,” explains Ms Baillie. “It is a way to ensure that their services and infrastructures will be interconnected and interoperable within a future European secure and federated data infrastructure.”

“Organisations interested in benefiting from the secure access to, as well as the sharing and combining of, data in different sectors can participate in the GAIA-X data domain working groups where they will be able to identify and prioritise use cases and align on common data standards required,” she continues. “They can possibly also build consortia to benefit from future opportunities as well as leverage national and European funding.”

International businesses welcome

In order for Luxembourg to succeed with its data economy ambitions, the country needs both indigenous talent and international entrepreneurs. “On the international level, we primarily look for companies whose technologies are aligned to gaps in the local market or whose products could benefit from a Luxembourg base to serve the European markets,” says Mr Foy. “Either way, they quickly find a legitimate place in the ecosystem. We introduce them to the ecosystem and help them start their local network, and they often highlight the access to decision makers as a business facilitator. The openness to cooperate is really a key value in Luxembourg and is often singled out as a refreshing approach to doing business.”

The openness to cooperate is really a key value in Luxembourg and is often singled out as a refreshing approach to doing business.

“The human side should not be ignored either,” adds Mr Grotz. “The multicultural make-up of Luxembourg fuels innovation and provides invaluable input and opportunities when working internationally.” He encourages anyone interested in knowing more about Luxembourg to get in touch. “The Luxembourg Trade and Investment Offices abroad are a first port of call, and Luxinnovation is an entry point to the data ecosystem for both local and international companies.”

Photos: © Luxinnovation/Marion Dessard
Illustration: Quattro Creative
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