North American Business in Luxembourg - Luxemburger Wort ...

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The Luxembourg AmericanChamber of Commerce in New YorkLuxembourgsbridge headin “Big Apple”by Tatjana Schaefer *How important is theUSA for Luxembourg?In terms of size, Luxembourg ranks 170th inthe world. The USA is the world’s largesteconomy and politically a super power aswell. Luxembourg’s financial center is thethird largest in Europe. The Grand Duchy isthe domicile of the world’s largest steelproducer, largest satellite operator andEurope’s biggest media corporation – not badfor tiny Luxembourg! To list the superlativesof the United States would burst the confinesof this article; a comparison between the twocountries is pointless. Why then is theAmerican giant interested in the tiny GrandDuchy at all? What makes the USA soimportant for the little state of Luxembourg?In surveying numerous personalities frompolitics, industry and society we sought andfound answers to these questions.The good relations between the two countriesare the result of a historical development. TheAmericans liberated the Grand Duchy fromNazi German occupation. Afterwards, the USAprovided important aid in rebuilding economicstructures. Today, Luxembourg is animportant bridgehead for numerous UScorporate groups in Continental Europe, andnot only in the financial sector. Both sides areintensively endeavoring to maintain thesegood relations – through Luxembourgianemissaries to North America and through USrepresentatives in the Grand Duchy.Andreas HolpertThe ideal location in Europefor U.S. companiesNew York City is without doubt among thebusiest cities in the world: more than 8million people originating from over 200nationalities live and work in this metropolis,creating the vibrant energy which is so typicalfor New York. It therefore is an ideal locationto establish and foster economic relations andto guarantee an intense exchange of ideas. Inthis context the Luxembourg AmericanChamber of Commerce was founded in thepresence of then Crown Prince, now GrandDuke Henri in 1991. For the past several yearsthe chamber has been located at the so-called“Luxembourg House”, a building which boastsa highly interesting history, situated only astone´s throw away from the United Nations.Until 1989 it was home to renownedcomposer Irving Berlin and his family; alltime favorites such as “White Christmas”were composed on site.Since its inception the Luxembourg American Chamberof Commerce (LACC) has created a platform andinfrastructure which is open to the Luxembourg businesscommunity in the United States and the Grand Duchyalike. None of the work could be accomplished without thesupport of the Chamber´s members; the 80 members whichcomprise Luxembourgish, French, Dutch, Belgian nationals aswell as Americans, therefore constitute the backbone of theorganization. The leading positions of the Board of Directorsand the Executive Committee are held by personalities fromthe business community who dedicate their time as volunteers:Fernand Lamesch (Chairman), Michel Franck (President/Spacesmith Architects), Cynthia Kalathas (Secretary/ Arendt & Medernach) and François Knaff (Consul General)are committed to the Chamber with great enthusiasm andcompetence.In close cooperation with the Luxembourg „Board of EconomicDevelopment“, which has offices in New York and SanFrancisco, requests for detailed information on Luxembourgas a business location are being answered.Furthermore the LACC organizes seminars on a regular basis,covering topics from cyber security, tax law to intellectualproperty. At these seminars participants have the opportunityto receive an update from experts of the subject and todiscuss matters in more detail at the following networkingreceptions.The LACC is an active member of the European AmericanChamber of Commerce in New York which opens the perspectiveto pan European aspects. In this framework the 15bilateral chambers have been jointly hosting very successfulevents. For Luxembourg as founding member of the EuropeanUnion, the link to the European level is of high relevance.The activities of the LACC are reflected in the quarterlymagazine „Luxembourg Business Journal“ which reviews theevents held in previous months and offers members a platformto showcase current developments and to further covereconomic trends in the Grand Duchy and North America. Thedistribution on both sides of the Atlantic supports the exchangeof information and fosters close ties between NorthAmerica and Luxembourg.Every two years the aspect of close economic cooperation isat the center of attention: The “Luxembourg American BusinessAward” recognizes the outstanding commitment of aNorth American company in regards to trade and investmentin Luxembourg. In 2010 the award will be bestowed upon theCEO and President of Husky Injection Molding Systems, Mr.John Galt. The Chamber is especially pleased that this year aCanadian company is the award winner, as this expands thegeographic reach of the LACC and to showcase Canada.In conclusion the LACC is dedicated to promote Luxembourgas ideal gateway to Europe. Especially in the context of theglobal economic and financial crisis an international chambercan offer a platform for an exchange of ideas. The LACC issupporting Luxembourgish companies located in New Yorkand continuously communicates the key advantages of Luxembourgas a business location. Analogies to New York areevident: Luxembourg equally boasts a cultural diversity of thepeople living and working in the Grand Duchy, furthermoreit’s an economic engine for the Greater Region, which attractspeople from the neighboring countries.The entire LACC team is committed to foster the transatlanticeconomic relations in the “Big Apple” and beyond.www.luxembourgbusiness.org* Tatjana Schaefer is Executive Director of the LACCPaul Michael Schonenberg,Chairman and CEO of theAmerican Chamber of Commercein Luxembourg (AMCHAM)David Gomez,Production director,Goodyear Tire Plant LuxembourgRick Minor,the former CEO of AOLLuxembourgTies between Luxembourg and the U.S. are historically strong and deep. Formany years, Luxembourg and the U.S. have been allies, friends and businesspartners. Due to immigration during the 1800s, more people with Luxembourgishheritage are living in the U.S. than now live in Luxembourg. There haseven been a rise in the number of people learning Luxembourgish in the U.S.,with new partnerships being created between organizations in both countriesto serve this need. Indeed, the U.S. is serving as a guardian of Luxembourgishculture.Both countries share the same abiding interests and values such as freedomand respect for human rights. During World War II, the U.S. provided a place ofrefuge for the royal family. In addition, General George S. Patton’s forces helpedliberate Luxembourg; such sacrifices are evident even today at the U.S. MilitaryCemetery in Hamm, Luxembourg. After the war, companies such as Goodyear,Delphi, DuPont and others came to Luxembourg, helping redevelop and restart“Center of Excellence”Goodyear settled down in Luxembourg in 1949, shortly after World War II. Thetire maker, based in Akron, Ohio, was looking for a footprint on the Europeancontinent and elected Luxembourg due to its geographically centralized location,its political and social stability and the availability of the workforce. The facilityin Colmar-Berg quickly gained in reputation and expansion projects madethe company grow over the decades. Today, Goodyear Luxembourg counts morethan 3250 associates, has a truck tire building plant with a European distributioncenter, an R&D facility responsible for the European, Asian and Africanmarkets and several plants producing intermediate components for the tirebuilding process.The importance of the Luxembourg facilities has always been valued by theGoodyear headquarters, which plans for Luxembourg to play an even more vitalrole in the European region and beyond. All Goodyear countries are currentlyA valuable economic clusterhas emergedThe other day I was welcoming the family of the third American e.commerceexecutive to move into our street in Luxembourg City. As I was explaining thebenefits of living in the City it reminded me that Luxembourg’s relationship tothe US today is very different from 10 years ago when I moved here to set upthe AOL Luxembourg office. Before 2003, Luxembourg was known in the USprimarily as an established, global finance center which rivaled in its own wayLondon, Paris and Frankfurt.When we arrived, the only Americans we encountered in town were tourists.The “new” Americans in Luxembourg are coming to town to live and work,thanks to the significant investment by US e.commerce companies in Luxembourg.It is possibly the greatest influx of Americans into Luxembourg sinceWorld War II and will be of more than just economic benefit to the two countries.American accents can be heard everywhere: in the restaurants, coffeethe economy of the Grand Duchy. The U.S. has thus historically helped protectLuxembourg’s interests and values.In modern times, there remain industrial companies which are the pillars ofthe Luxembourgish economy, along with a full range of U.S. banks and financialinstitutions—Citigroup, J.P. Morgan, State Street Bank, Chase and more—withestablished EU headquarters and operating centers in Luxembourg. These U.S.business interests have guaranteed continuing business ties and promoted localeconomic prosperity as a result of direct U.S. business investment. Suchinvestments are not only very helpful to Luxembourg, they also show the abidingappreciation Americans have of the Grand Duchy. Luxembourg is the ideallocation in Europe for U.S. companies to have their headquarters as well asshow support between the two countries which exists at all levels, includingthrough AMCHAM. AMCHAM members and staff are fully committed to promotingLuxembourg as a prime location and business center.reviewing their organizational structures and processes in order to move tohigher standardization, simplification, adaptability to meet the demands andexternal focuses in a more cost efficient way. Luxembourg will play a centralrole, in taking over the responsibilities for supplying all tire plants with raw materialsand dispatching all finished products towards the end user. A centralizedmanagement will considerably simplify administrative tasks while improvingthe efficiency of existing Goodyear systems. By capitalizing on efficiencies,Goodyear will be able to further invest in areas such as research and development,manufacturing and marketing, enabling the company to further developin the European market place. This challenging project was initiated three yearsago and will be finalized by the end of this year. 13 countries will then be operatingon a new business model, using new processes while being supported by acomplete new systems environment, with Goodyear Luxembourg as its Centerof Excellence.bars, shops, and in the schools. In a relatively short time, Luxembourg is nowrecognized by the major e.commerce companies in Silicon Valley as one of themost attractive, if not logical, jurisdictions in the EU in which to set up centralizedoperations for EU expansion. From the arrival of the first major player,AOL, 10 years ago, a valuable economic cluster has emerged, leading to thecreation of local jobs, the introduction of new skills and ideas into the economy,the generation of tax revenues and a greater demand for high value serviceslocally. But success can be fleeting. Given its importance to the economy, thee.commerce cluster must continue to be supported by the Companies and theGovernment alike. It is hoped that both Americans and Luxembourgers willcontinue to cherish and promote the US-Luxembourg economic and culturalrelationships through this bridge across the Atlantic. There is a solid foundationin place on which to build.10 11
Luc Frieden,Minister of FinanceJean Calmes,Honorary President of theAmerican Society Luxembourg,former President of the AmericanBusiness Club of Luxembourgand Director of the LuxembourgAmerican Cultural Society,WisconsinUnprecedented Opportunityfor Long-Term PartnershipThe US and Europe have been and still are close political allies. Both stand forfreedom and justice. The US and Europe made historically unprecedented commitmentsto these ideals in the First and Second World Wars. Moreover, theUnites States’ decision not to withdraw itself immediately after the World WarII contributed to the stabilization of Europe and enabled the war-torn Europeancountries to forge closer ties in freedom and prosperity. So it was also onlynatural – in light of our shared values on the two sides of the Atlantic – that asuccessful internal market would develop over time, which today provides forthe free movement of people, goods, and capital.From an economic point of view, the EU and the US are the most interconnectedregions in the world. As is attested by the presence of so many US corporationsin Luxembourg, the Grand Duchy is playing a key role in this relationship.Luxembourg’s international connections and our level of professionalism andservice quality are held in high regard by our resident American companies.This has prompted a wide array of major US companies to choose Luxembourgas their hub for cross-border European services.I was fortunate to follow-up over a period of 40 years the establishment of U.S.companies in the Grand Duchy, mainly through the activities of the European-American group created by H.J. Leir (COC / IMC/ S.A. des Minerais etc.). Amongthe most significant are industrial investments such as Continental Alloys SA,Dommeldange, a joint venture of our group with the Arbed-group after integrationof patents and equipment generated from our research facility La ContinentaleNucléaire SA , Bascharage; National Luxalum, Dudelange, today undercontrol of Novelis group, created by one of our U.S. shareholders. Our grouphas contributed in the set-up of several commercial organizations, companymanagement and consulting firms (assisting the beginnings of Ernst & Whinney,now Ernst & Young Luxembourg) and several banks, including Wells Fargo,California and Republic National Bank of New York (now part of HSBC).One must realize that all U.S. investments in Luxembourg (from the first and stillmost important one, Good Year founded in 1951, to the smallest one, not to forgetthe shining example of Guardian, were generated from a relationship of businessconfidence between man and man, before being quickly endorsed and embodiedin the framework of efficient structures like the Board of Economic Development,Ministries of Foreign Affairs and Economy, embassies / consulates etc..Particularly in the financial sector, Luxembourg has made itself indispensableto the US as a ‘Gateway to Europe’. It has also made the US indispensable toLuxembourg as a key business partner. This is particularly evident in the investmentfund sector, in which Luxembourg and the United States are the twoworld leaders. With current figures of 10 trillion dollars in managed assets, theUS and Luxembourg markets in this sector are roughly of equal size. WhereasAmerican mutual funds are primarily offered to domestic clients, Luxembourghas developed itself into a truly international market: investment funds issuedin Luxembourg are sold throughout Europe and even the rest of the world.This fundamental difference also provides an excellent opportunity for longtermpartnerships. With a 20% market share, the US is the top fund promoterin Luxembourg. Furthermore, the most renowned fund manages and custodianbanks are all present on site. New legal requirements in retail and in the alternativefund sector will enable the US to continue enjoying the benefits ofour financial center and its characteristic openness. Arguably, the associateddevelopments in pension funds and hedge funds in particular ensure a long andpromising future for our partnership.As a student in the US 20 years ago, and later as Minister of Justice and Ministerof Finance, I have always felt and valued the American people’s friendshipand loyalty to Luxembourg. I am confident that a strong transatlantic partnershipwill provide a foundation for solutions to the major challenges our worldis facing.The voice of a small country is asimportant as that of a larger countryThe moral basis for this “system”? It is, in my opinion, on-going internationalcredibility and a reputation of high integrity that our country enjoys in the UnitedStates, which is obviously not a function of its size or any element of power.Precisely because of these facts, the voice of a small country, often conciliatoryand directly disinterested, is as important as that of a larger country. It isthis image, rooted in the subconscious collective memory of both partners fornearly a hundred years and most carefully maintained with great efforts sincethe beginning of the 2nd World War, which is the keystone of a rather unusualand unmatched situation. The challenge for our dynasty and our local politicalsystem is to preserve that particular relationship.Today the main contribution of the U.S. economy in the Grand Duchy consistsof abt. forty industrial investments totalling more than EUR 5 billion; this representsapproximately 25% of foreign industrial investment in Luxembourg andputs the US ahead of our powerful neighbours.The financial sector is characterized by the domiciliation of investment fundsin excess of EUR 1.5 trillion, representing the largest market after the UnitedStates itself. 20% of the centers’ funds originate from the United States; it isthe largest part and similar to that of Germany. There are currently 6 U.S. banksin Luxembourg; also many insurance companies, trustees and lawyers’ officesassociated with Luxembourg partners .One can argue without exaggeration that the Luxembourg economy has beenstrongly influenced, if not sculpted, by U.S. presence. In addition to the U.S. economiccontribution, many interesting side developments in the field of culture,education and philanthropy emerged over time. There is no limit to develop allthese relations to infinity.Georges Schmit,Consul General and head of the“Trade and Investment Office” inSan FranciscoJean-Paul Senninger,Luxembourg’s Ambassadorto the USEver deeper, intensified relationshipsThe celebration of the exemplary contribution of a North-American corporationto the economic, technological, and social development of Luxembourg by theAmerican-Luxembourg business community, on October 20, 2010, in New York,is the opportunity for an updated focus on the economic relationships betweenthe largest economic power and one of the smallest national economies onthe planet.These relationships far exceed the usual statistics, such as the hundred Americancompanies present in Luxembourg or the dozen Luxembourg companiesoperating on the North-American continent.They are not limited to the US contribution to employment in the Grand Duchyof approximately 4%, or to the 10% of direct foreign investment shares in Luxembourgheld by American investors, or even to the three billion Euro investedby Luxembourg companies in their US branches. Additionally, the content ofthese relationships far exceeds the few billion Euros of annual exchanges ofgoods and services as shown in the current Luxembourg foreign trade balance.Last but not least, these relationships are only imperfectly illustrated by theAn Integral Part of Our LivesIf you ask about the importance of ties between the United States and Luxembourg,you have answered your own question. We hardly ever think about themin our daily lives because they are an integral part of our lives: our stability hasbecome our well-being.It is true that the European Union is the framework of reference in which weshape our economic and social development, and to a large degree our politicaland cultural development as well. However, this does not impair our transatlanticfriendship or the closeness of our ties in any way. Quite the opposite in fact,as this partnership gives our country and our society a second base of supportfor our stability.This is particularly evident in the area of global security. In a time of global insecurity,our security is bound up with the only global superpower that is willingto play the role of stabilizer, from the war on terror and the freedom of the searoutes, to the war on drugs and cyber crime.Our sudden closeness to the US should come as a surprise to no one. We sharethe same values and pursue the same goals. Our freedom is based on theseshared values and this US commitment to freedom - including our own - andover 20% share held by American promoters on the Luxembourg investmentfund market.Beyond these usual figures describing bilateral economic relationships, the economicrelationships between the United States and Luxembourg benefit from astable foundation and enjoy deep exchange dynamics in the fields of technologies,know-how, innovation, and people skills, generated by a long history of mutualopenness and trust between the two countries. While they were one-way for along time, these exchanges are more and more two-way, with Luxembourg companiesbringing their share of skills and know-how to their American subsidiaries orpartners. The growing relationships between academic and research institutionson both sides of the Atlantic are reinforcing this foundation and these dynamics.The deepening and consistency of economic relationships result, not only fromscientific, commercial or financial exchange structures, but also and most importantlyfrom the choice made by men and women to live, study, and work ‘onthe other side of the Atlantic’ to become ‘proximity players’ in ever deepeningand intensifying relationships!the human, economic, and social development it affords. Without America’sintervention in the two World Wars, there would be no free, independent, andprosperous Luxembourg.Today, our economy has been successfully integrated into the global economy.This opening-up to the outside is due in large part to early investmentsby American industrial and service companies, which have and will continueto make up a decisive portion of the growth in our economic performancefollowing the end of World War II. In addition to this, the US market is stillan integral part of every business plan, for all of our businesses and serviceproviders.Despite all our differences in size and population, this gives us a strong bondof friendship, which naturally works to deepen and expand our older connections,arising in the years of Luxembourgian emigration to the United States.The Luxembourg American Cultural Center in Wisconsin, which celebrated itsofficial grand opening this past summer, is living proof of the complexity anddepth of the ties between our countries and the importance of our exceptionalpartnership and friendship.One moment.One satellite network.Infinite connections.Our satellite fleet reaches 99% of the world’spopulation, offering our customersregional strength and expertiseon a global scale.Arsene Schiltz,Managing Director and WorksDirector DuPont de Nemours(Luxembourg)An integrated Europeanmanufacturing and business centreDuPont was founded in 1802 by a French immigrant in Delaware, U.S.A. Thecompany diversified during its more than 200 years of history to become oneof the most advanced science companies supplying science-based solutions forthe present expectations and needs of society.So as to be present in the market of the newly founded European Communities,DuPont invested in Luxembourg as of 1962. The first contacts betweenLuxembourg and DuPont were established by Prince Charles, first chairmanof the Luxembourg Board of Industrial Development (BID), and actively supportedby Paul Elvinger and Pierre Werner. At that time, Luxembourg neededto diversify its economy, and the DuPont investment was the second largestinvestment by a US company after the establishment of Goodyear at Colmar-Berg.The Contern site started up in 1965 with two polyester film production lines.Over the years, DuPont invested more and more into other production lines atthe Luxembourg site: Hytrel® thermoplast mainly used for automotive applications;Typar® spunbonded polypropylene (nonwoven) used in geotextiles, drainage,carpet as well as in displays; Tyvek® spunbonded polyethylene (nonwoven)used for house wrapping, roofing, in protective clothing, graphics and medicalpackaging; as well as into other polyester production lines.Since the year 2000 the polyester production is operated by a joint venturebetween DuPont and Teijin Films.DuPont Luxembourg grew into an integrated European manufacturing andbusiness centre with its Research & Development, engineering, manufacturingdevelopment, marketing, sales and customer services activities. With 1100employees, DuPont is today the fourth industrial player in Luxembourg.What makes DuPont stand out is our ability to take scientific discovery andtransform it into products that correspond to needs of society. The company isalso well known for its leadership in safety that has even become a business.This is the basis to Sustainable Growth.As a market-driven science company, DuPont provides solutions that help theworld addressing the needs for more, better and healthier food, reducing ourdependency on fossil fuels, protecting people and the environment and servinggrowing populations in developing markets.Recent innovations at the DuPont Luxembourg site include: solar back sheetfilms for photovoltaic applications, solar modules that are directly integratedinto the roof in replacement of tiles, DuPont Energain® the solution to thermalmass in low inertia buildings, new temperature resistant capacitor films withhigh electric properties for hybrid car applications, elastomers for automotiveairducts, renewable sourced elastomers, the new extra-strong and fully recyclableprinting substrate DuPont Imvelo® and finally a new process to diversifya substrate such as Tyvek® by metalizing the surface and/or applying variousfunctional coatings in a vacuum.12 www.ses.com13www.bizart.lu25 yearsBringing people together through thepower of satellites since 1985.In 2010 SES celebrates 25 yearsFounded in 1985, SES launched its first satellite in 1988. Since then, we’veexpanded to become a global operator with a fleet of more than 40 satellitescovering 99% of the world’s population. Today, we are reaching out beyond ourcore markets of Europe and North America and investing in new capacityto meet the growing demand in Asia, Africa, the Middle East and Latin America.With our ongoing fleet expansion programme, SES will continue to beYour Satellite Connection to the World.
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