Luxembourg ranks 13th in global business environment index

The Innovators Business Environment Index (IBEI) 2026, published by StartupBlink, evaluates 125 countries on how well their regulatory, financial and infrastructural frameworks support business growth and innovation – identifying the best countries for business in Europe and beyond. Luxembourg ranks 13^th globally, 6^th in Europe and 4^th among EU member states.

The index assesses countries across three core pillars: Ease of Operating a Business, which measures how simple and efficient it is to start and run a company; Business Incentives, covering financial attractiveness for entrepreneurs and investors; and Market Perception, reflecting governance quality, credibility, stability and global openness.

Strong foundations for business

The Luxembourg business environment performs particularly well in Market Perception, ranking 12^th globally with a score of 90.076. This pillar captures how international stakeholders view a country's governance, transparency and accessibility – factors that directly influence investment decisions.

The country also secures 9^th place globally in the Digital Infrastructure category, which evaluates internet speed and internet freedom. For technology-driven companies considering European expansion, this makes Luxembourg a highly connected operational hub and a compelling destination for those looking to invest in Luxembourg.

Additional strengths place Luxembourg in the top 25 percent globally across several key parameters:

• Trade Openness
• Cross-Border Banking
• Credit Rating
• Funding per Capita
• Governance & Law

In the Taxation Functional Category, Luxembourg ranks 2^nd in Western Europe, reflecting its competitive fiscal environment for businesses and investors.

Among its neighbours, Luxembourg outperforms Belgium, Germany and France in the overall rankings. The Netherlands leads the regional comparison at 7th globally.

This positioning reinforces Luxembourg's status as one of the best countries for business in Europe and a leading destination for international companies within the European Union.

Room to improve operational efficiency

While Luxembourg performs strongly overall, its ranking in the Ease of Operating a Business pillar (38th globally) indicates scope for further streamlining of administrative processes. The government has introduced several policy initiatives to address this and strengthen the Luxembourg startup ecosystem, including the From Seed to Scale strategy, enhanced stock-option benefits for employees, an impatriate regime for skilled professionals and a proposed startup tax credit.

These measures are designed to simplify the process for companies establishing and scaling operations in Luxembourg, complementing the country's existing strengths in governance, digital infrastructure and access to capital.

Photo credit: Luxinnovation/Sabino Parente