Luxembourg 2nd leading green finance centre in the world

Published by London-based commercial think-tank Z/Yen, the Global Green Finance Index (GGFI) is a benchmark publication covering the development of green finance in financial centres. It is based on a worldwide survey of financial professionals’ assessments of the quality and depth of green finance offerings in financial centres.

Luxembourg 2nd in depth, 6th in quality

In the GGFI edition published in March 2020, Amsterdam is considered as the world leader in terms of the depth of green financing, with Luxembourg in 2^nd place and Copenhagen in 3^rd. Luxembourg improved its rating quite considerably compared to the previous edition and retains its 2^nd place.

London comes out on top in the green finance quality ranking, followed by Amsterdam, Zurich, Stockholm and Copenhagen. Luxembourg ranks 6^th, up one place compared to last year. The country gained 24 points in the rating.

If the depth and quality ratings are combined, Luxembourg ranks 4^th internationally after Amsterdam, Zurich and London.

Z/Yen comments that there is a growing confidence in the development of green finance across all regions, with almost all financial centres receiving increased ratings. The index is strongly dominated by financial centres in Western Europe, a fact that according to Z/Yen “reflects the continuing work being undertaken by European financial institutions, central banks, regulators, and the European Union to embed sustainability in their regulatory work”.

Luxembourg world leader in human capital, 2nd in sustainability

The GGFI is built on criteria divided into four main areas of competitiveness:

• Sustainability: green finance activity, environment and biodiversity, renewable energy, quality of life
• Infrastructure: built infrastructure, ICT infrastructure, transport infrastructure, fossil fuel usage
• Human capital: availability of skilled personnel, flexible labour market, wealth and economy, governance
• Business: political stability and rule of law, institutional and regulatory environment, tax and cost competitiveness, economic development

Luxembourg tops the ranking for human capital, ahead of Copenhagen and Stockholm. The country is also 2^nd in the world in the area of sustainability, behind Zurich and ahead of Copenhagen.

In addition, Luxembourg ranks 3^rd in the field of business and 6^th in infrastructure.

Photo: © Luxinnovation/Sabino Parente