Liechtenstein – The Principality of Liechtenstein a state in Western Europe

Liechtenstein

The Principality of Liechtenstein (German: Fürstentum Liechtenstein [ˈfʏɐstəntuːm ˈliːçtənʃtaɪn] ) is a dwarf (160 km²) state in Central Europe associated with Switzerland. The country takes its name from the ruling Lichtenstein dynasty. The capital is Vaduz. Liechtenstein borders with Austria on the east and Switzerland on the west, its territory is completely surrounded by territories of these states. Form of government is constitutional monarchy.

It is not a member of the European Union or European Economic Area; it is a party to the Schengen Agreement.

Contents

Political structure

Liechtenstein is a constitutional monarchy. The current constitution entered into force on October 5, 1921. The head of state is Hans-Adam II, Prince von und zu Liechtenstein, Duke of Troppau and Jägerndorf, Count Rietberg. Actually ruled the country since 1984, and ascended the throne on November 13, 1989. The prince administers the state, endorses the legislative acts adopted by the Landtag (parliament), represents Liechtenstein in relations with other states, appoints civil servants, and has the right of pardon. The legislative body – the Landtag, consisting of 25 deputies, elected by direct and secret ballot by proportional representation (15 deputies from Oberland and 10 from Unterland) for a four-year term.

History

The territory of Liechtenstein had been part of the Roman province of Rhezia since 15 B.C. According to tradition, in the year 300 (?) St. Luke converted to Christianity the inhabitants of this area, which was under Roman rule. [ source not cited 582 days ] The Franks invaded the country in 536. Later, under Charlemagne, the bishop was removed as governor and secular rulers were appointed to the position. The area was under Carolingian rule until 911, when the Germanic Empire broke up into large and small duchies.

Within the duchy of Swabia in what is now Liechtenstein were the feudal estates of Schellenberg and Vaduz, then part of the Holy Roman Empire. In 1507 Emperor Maximilian granted Vaduz special rights and privileges, including sovereignty and tax collection. These rights were transferred to the Austrian Lichtenstein family.

The Lichtenstein family was eager to gain a seat in the Reichstag of the Holy Roman Empire. To do so, it had to own lands whose suzerainty would be the emperor himself (unmittelbar). For this purpose, Hans-Adam I purchased two tiny fiefdoms on the Swiss border from impoverished owners of Hohenems – Schellenberg (1699) and Vaduz (1712). These lands had the necessary legal status.

With the assistance of Eugene of Savoy (who was Prince von Lichtenstein’s matchmaker), the emperor recognized the head of the family, Anton Florian, as a prince of sovereign dignity in 1719. This is how the Principality of Liechtenstein came into being.

From 1815 to 1866 Liechtenstein was a member of the German Confederation, and in 1860 the Liechtensteins became hereditary members of the upper house of the Austrian parliament, and in 1866, under Johann II Liechtenstein (1840-1929), the princedom gained independence. In the Austro-Prussian war of 1866 Liechtenstein acted as the ally of Austria, from 1876 to 1918 had close ties with Austria-Hungary.

After the First World War Liechtenstein terminated the treaty with Austria and reoriented to Switzerland: In 1921 an agreement on trade and postal service was signed, in 1924 a customs union was concluded. Since then, the currency of Liechtenstein is the Swiss franc. Since 1919 Switzerland has represented the diplomatic and consular interests of Liechtenstein abroad.

Administrative division

Liechtenstein consists of two historically formed administrative parts: Oberland (Upper Liechtenstein) with the center in Vaduz, and Unterland (Lower Liechtenstein) with the center in Schellenberg. The Principality of Liechtenstein is divided into 11 communes. The communes mainly consist of a single city. Five communes are located within the electoral district of Lower Liechtenstein, the remaining six belong to Upper Liechtenstein.

Geography

The Principality is located in the spurs of the Alps, the highest point is the Grauspitz mountain (2,599 m). One of the largest rivers of Western Europe – the Rhine – flows through the western part of the country. The climate is temperate with precipitation of 700-1,200 mm a year. About a quarter of the territory is covered by forests (fir, beech, oak), in the mountains – subalpine and alpine meadows.

Along with Uzbekistan, it is one of only two countries in the world, which requires crossing two borders to reach the world ocean.

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Climate

Moderately continental, alpine. Average temperature in January is about 0 °С, in July +19 °С.

Economy

Liechtenstein – a prosperous industrial country with a developed financial services sector and a high standard of living.

The GDP of Liechtenstein in 2007 was $4.16 billion. GDP per capita is $134,000 (2nd place in the world). Per capita GDP is $134,000 (2nd place in the world).

The main branch of economy – manufacturing industry: metalworking, precision instruments, optics, vacuum technology, electronic systems, microprocessors. The basis of industry is made by precise machine and instrument-making. The largest companies are Hilti AG (fastening, small-sized construction equipment with self-contained power supply) and Balzers AG (ultra-deep vacuum equipment for optical, microelectronic and microprocessor industry). Industry is almost entirely export-oriented. The food industry (in particular, the production of canned foods and wines), textiles, ceramics and pharmaceuticals occupy a significant place.

With the development of the manufacturing industry and the growth of the entrepreneurial sector, the Liechtenstein workforce itself is no longer able to meet the demand for workers. About 32,400 persons are employed in the various economic sectors, of whom more than a third (12,900 persons) commute daily from Austria, Switzerland and Germany. The industrial sector employs 43%, the service sector 55%, and agriculture less than 2%.

A significant source of income for the population and the treasury is foreign tourism, as well as the issuance of stamps.

Agriculture

Agriculture specializes mainly in pastoral meat and dairy cattle breeding (75% of agricultural production). Grain crops, potatoes and vegetables are grown. Winemaking is traditionally developed. Foothills and lower slopes of mountains are occupied by orchards and vineyards. High quality wines are produced from local grape varieties.

Foreign trade

Export in 2008 – $2.47 billion. The export structure is dominated by precision instruments, electronics, postage stamps, ceramics. Export goes mainly to the EU countries and Switzerland.

Imports in 2008 – 0.92 billion dollars. The structure of imports includes machinery, metal products, textiles, food, cars. The main import partners are the EU countries and Switzerland.

Banking System

The country has an efficient banking system (total balance sheet total of approximately CHF 32.5 billion). The largest banks – the National Bank, “Lichtensteiner Global Trust”, “Verwaltungs- und Privatbank” (since 2005, has a representative office in Moscow). Due to the low capital and profit taxes, as well as strictly protected banking secrecy, Liechtenstein retains its position as a major financial center.

Liechtenstein banks came under criticism after in February 2008 when German prosecutors obtained a disk with the data of several hundreds of German citizens who were suspected of tax evasion by means of money transfer to accounts of various foundations in Liechtenstein.

Along with Monaco and Andorra the Principality of Liechtenstein is included in the black list of “tax havens” – the states where the residents of other countries evade taxation.

Foreign economic relations

More than 73.7 thousand international concerns and foreign companies are registered in Liechtenstein because of the low level of taxation, uncomplicated registration rules and for the purpose of financial secrecy. The state budget consists mainly of taxes, including from these companies (about 30 %), incomes from issue of postal stamps (10 %) and foreign tourism.

Population

The Liechtenstein population as of December 31, 2011 stands at 36,476, with an average density of about 220 inhabitants per km².

The birth rate is 9.75 births per 1,000 persons (2009). Mortality – 7.39 per 1000 people (infant mortality – 4.25 per 1000 newborns).

Annual population growth – 0.7% (2009).

Life expectancy: men – 76.6 years, women – 83.5 years (2009).

The majority of the population is Liechtenstein (Alemannic), 65.6% according to the 2000 census, the rest are Italians, Swiss and Austrians.

Most believers (76%) are Catholics, about 7% of the population are Protestants.

5 largest population centers (2008):

    – 5 765; – 5 088; – 4 688; – 4 467; – 4 183

Culture in Liechtenstein

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As a result of its small size, Liechtenstein has been influenced by outside culture, especially that coming from the southern German-speaking regions of Europe, including Austria, Bavaria, Switzerland and, in particular, Tyrol and Vorarlberg. “The Historical Society of the Principality of Liechtenstein plays an important role in preserving the culture and history of the country.

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The largest museum The Art Museum of Liechtenstein is an international museum of modern art with important international art collections. The building by the Swiss architects Morger, Degelo and Kerez is a milestone in Vaduz. It was completed in November 2000 in the form of a “black box” of black basalt. The collection of the museum also contains the national art collections of Liechtenstein.

Another important museum is the Liechtenstein National Museum (Liechtensteinisches Landesmuseum), which shows permanent exhibitions on the cultural and natural history of Liechtenstein, as well as special exhibitions. There is also the Museum of the Press and the Museum of Skis.

The most famous historical sites are Vaduz Castle, Gutenberg Castle, the Red House and the ruins of Schellenberg.

Music and theater are an important part of the culture. There are many musical organizations, such as the Liechtenstein Music Company, the annual Guitar Day and the International Society of Josef Gabriel Reinberger, which take place in the two main theaters.

The Prince of Liechtenstein’s Private Art Collection is one of the world’s leading private art collections, shown at the Palais Liechtenstein in Vienna.

Amateur radio is a hobby of some citizens and visitors. However, unlike virtually all other sovereign nations, Liechtenstein does not have its own ITU number. It uses the Swiss call sign prefixes (usually “NV”), followed by a zero.

Law enforcement and justice authorities

The Liechtenstein Police (German: Landespolizei ) has 120 officers serving in the Criminal Police, the Security and Traffic Police, and the Coordination Service [3] . In addition, there is the communal police (Gemeindepolizei ).

The Principality renounced the armed forces in 1868. The constitution, however, enshrines a provision for conscription.

International relations

In 2004 Liechtenstein signed an agreement with the European Union on the expansion of the European Economic Area. For a long time the signing of the treaty was postponed due to the accession of the Czech and Slovak Republics to the EU in 2004. The Czech Republic and Slovakia refused to recognize Liechtenstein as a state because of unresolved property issues of the ruling princely house. By decrees of Beneš, the property of German (including also Austrian and Liechtenstein) individuals and legal entities on the territory of Czechoslovakia was expropriated by this state. On September 8, 2009, the Czech Republic and Liechtenstein signed a cooperation agreement [4][5] , which marked the diplomatic recognition of Liechtenstein by the Czech Republic. In December of the same year a similar treaty was signed with Slovakia [6] [7].

The Principality has its embassies in the United States, Germany, Belgium (which also represents Liechtenstein in the Vatican and is a mission to the European Union), Switzerland and Austria. In other states the interests of Liechtenstein are represented by embassies of the Swiss Confederation.

The Principality of Liechtenstein

The Principality of Liechtenstein

The Parliament of Liechtenstein. Photo: Presse- und Informationsamt, Vaduz

The Principality of Liechtenstein is a dwarf state located in the heart of Europe between Switzerland (the border cantons of Switzerland: St. Gallen and Graubünden, respectively, in the west and south – more in our article “Switzerland on the map of Europe”) and Austria (federal land Vorarlberg – in the east), which has no access to the sea. Did you know that the territory of Liechtenstein is so small that the state ranks 6th in the list of the smallest states? About this and much more you will learn from this material.

Basic information about the country

Official name

Principality of Liechtenstein ; standard German: Fürstentum Liechtenstein; since local dialects do not have their own clear spelling rules, the country may also be unofficially called by one of the following variants: Förschtatum Liachtaschta, Füarstatum Liachtastoo, Fürstatum Liachtastei.

The capital

City of Vaduz, which serves as the seat of the national government and the Archdiocese of Vaduz.

Geography

Area

The principality fits on only 160 square kilometers of territory. Only three other European states (and five states in total on the planet) have even smaller territories.

A surprising fact: Liechtenstein and Uzbekistan – the only countries in the world, bordering only with the countries, which themselves have no access to the sea.

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Malbun

Malbun (Liechtenstein). Graphic: Böhringer Friedrich

How to get there?

Liechtenstein is actually located in the heart of Europe – just an hour by car from Zurich (110 km) and Basel (190 km). Its banks are washed by the river Rhine, which also flows in Switzerland.

The landscape

Almost half the territory of the small state is strewn with mountain peaks of the Central Alps, among which the highest point is considered a mountain Grauspitz – 2,599 meters above sea level. Mount Nafkofp, 2,570 m above sea level, lies on the border of Liechtenstein with Austria and Switzerland.

Climate

The country can be conventionally divided into two climatic zones. On the one hand, a dwarf state is surrounded by cool moist air from the nearby Lake Constance, on the other hand – by dry warm air (föhn) from the high Alps.

The weather in Liechtenstein is characterized by a relatively low rainfall and high temperatures. As a result the local climate is perfect for growing grapes and fruit under the warm sun, which peeks out from behind the clouds for about 1,600 hours a year.

Internet domain

International phone code

Population

According to official figures for 2017, Liechtenstein has a population of 37’600. Population density: 233 people per square kilometer. The largest settlement in Liechtenstein is considered to be the Gemeinde Schaan, where about 6’000 people live. By comparison, 5,400 people live in the capital of Vaduz.

The number of foreigners

The number of people living in the Principality without Liechtenstein citizenship amounts to 33 percent of the total population. The principle of freedom of movement (Personenfreizügigkeit) applies between Liechtenstein and the EU / EFTA, according to which the citizens of the participating countries are free to settle in each other’s territory as long as they have a work contract or sufficient financial means to stay. However, for Liechtenstein there is a special rule: The Principality can restrict the inflow of new citizens from the EU, if the number of permanent foreign residents is at least 33%. The reason for this rule is simple: Liechtenstein is too small to host all those who want to work from the EU. Therefore, many who work in Liechtenstein live in neighboring Switzerland (mainly in the canton of St. Gallen) or in Austria.

Liechtenstein and the EU

The border of Liechtenstein. Thousands of foreigners working in the Principality already cross it every day. Graphics: St9191

Official language

The official language of the dwarf state is German. At a domestic level, local dialects of standard German are used. It is noteworthy that Liechtenstein is the only state in which only German is the official language. In other countries (Germany, Austria, Switzerland, Luxembourg, Belgium, Italy, Denmark), German, in its official status as a state or local language, neighbors with other languages. Read more about the language issue in the Confederation in our article “Switzerland – the country of the four state languages.

Main religion

Christianity. The Roman Catholic Church is, according to Art. 37(2) of the Constitution of the Principality of Liechtenstein, the state church and is therefore under the full protection of the state.

Life expectancy (male/female)

75 years/82 years (UN figures).

Schooling

Compulsory school in Liechtenstein lasts 9 years; of these 5 years are in elementary school and 4 in elementary school. In turn, the basic period of school is divided into 3 classes, the access to which depends on the abilities of the pupil.

The Principality has a University of Liechtenstein, which is a public school. The fields of study are architecture, spatial planning, and economics. The cost of education per semester: 850 francs.

Many citizens of the Principality prefer to study at Swiss universities (above all the University of Zurich and the University of St. Gallen).

History

  • The first inhabitants on the territory of a dwarf state appeared in the Neolithic Era, about 5 thousand years B.C;
  • In the XV century BC Liechtenstein became part of the Roman province of Recia;
  • May 3, 1342 was founded the county of Vaduz, which in the following decades was subjected to numerous robberies and wars;
  • In 1712 Prince Johann Adam (aka Prince Joseph Johann Adam von Lichtenstein) purchased the Countship of Vaduz, which the then rulers of the Counts of Hohenems had been forced to sell due to heavy debts;
  • The new owner merged the region with the sovereign lands of Schellenberg, purchased in 1699, and established the imperial Principality of Lichtenstein in 1719.
  • On January 23, 2019, the monarchy, with all proper solemnity, celebrated the 300th anniversary of its founding.
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The economy of Liechtenstein

Monetary unit

1 Swiss franc = 100 rappen. As you have already guessed, the Principality has no currency of its own, but uses the monetary unit of neighboring Switzerland. For the banks in Liechtenstein this fact has a huge advantage: credit institutions in the Principality can open accounts for their customers in a stable currency, which is the Swiss franc.

Main export articles

Engineering, food, postage stamps, dental care products. The vast majority of products created are exported.

Contribution of agriculture to GDP of Liechtenstein is equal only to 2 percent. Nevertheless, about a third of the arable fields meet the highest standard of bio-technology.

Unemployment

Unemployment in Liechtenstein is quite low: as of August 2016, 2.2 percent of the population was unemployed and therefore registered with the local employment center. This low unemployment rate is the best in Europe. See also: Unemployment in Switzerland.

International Financial Center

  • Details: Banks in Liechtenstein .

Liechtenstein is one of the most important financial centers in Europe, which is ensured by the political neutrality and economic stability of the country. About 16 percent of the population is employed in the banking/financial sector. The contribution of the financial center to GDP of Liechtenstein is equal to 24 percent.

Due to its liberal legislation, the Principality is known in the financial world as a tax haven. This fact attracted attention in 2000, when a group of international experts in their reports criticized the country for the lack of an effective system of financial control. According to these reports, Liechtenstein created conditions for unhindered money laundering for Russian, Italian and Colombian criminal gangs.

In 2008 Liechtenstein became one of the three states (along with Andorra and Monaco), which the Organization for Economic Cooperation and Development (OECD) included in the list of countries, where tax havens and financial structures are not transparent.

The Principality of Liechtenstein, general information about the state, Liechtenstein on the international scene, the international financial center of Liechtenstein, the political system of Liechtenstein

Liechtenstein coat of arms. Graphic: public domain

In this regard, the state has revised a number of laws, and now the likelihood of using the jurisdiction of the Principality for criminal purposes has been greatly reduced. Nevertheless, Liechtenstein retains the principle of bank secrecy. In the short and medium term the opening of bank information to the tax authorities of Russia and other CIS countries is not expected.

Political system of Liechtenstein

The coat of arms of the Princely House of Liechtenstein coincides with the coat of arms of the country. The dwarf state has three versions of its coat of arms: small, medium and large. The latter consists of six elements, each telling the history of the Princely House:

(1) in the center of the coat of arms is a small shield divided by two horizontal bands of gold and red. This is the family coat of arms of the royal family of Lichtenstein;

(2) the first quarter is decorated with a black eagle on a golden field. This is the coat of arms of Silensia (historical region in Central Europe, which today belongs mainly to Poland – author’s note);

(3) in the second quarter there is a green arc-shaped rutting crown on the field in a black and gold stripe. This is the coat of arms of the Quaering family;

(4) the third quarter is dissected by two vertical stripes of red and white, which represent the coat of arms of the Duchy of Troppau;

(5) the fourth quarter is decorated with a black harpy on a gold background. This is the coat of arms of the ruling family of the county of Rietberg;

(6) the base of the shield is in the form of a golden hunting horn on a blue background – the coat of arms of the Duchy of Jägerndorf.

The red cloak with ermine fur and the princely crown on the “top” of the coat of arms symbolize the monarchy and the power of the prince.

The Liechtenstein flag consists of two wide horizontal stripes of blue and red, which divide it in half. To the left of the upper blue stripe is the golden symbol of the so-called “Princely Hat”.

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Flag of Liechtenstein

Liechtenstein Flag

Historians are still debating exactly how the modern flag originated. It is assumed that the authors borrowed the colors from the uniforms of the members of the Princely Court in the 18th century. In 1937, they decided to add a princely hat to avoid confusion with the national flag of Haiti.

Head of State

Over the years, the country has been the center of much political controversy over the role and power of the hereditary monarchy. After another such campaign, in March 2003, a constitutional referendum aimed at expanding princely powers elected Prince Hans-Adam II as ruler by a majority vote.

Prince Hans-Adam II

Prince Hans-Adam II. Graphics: GuentherZ, CC BY 3.0

In fact, the outcome of the referendum made Liechtenstein the only state in Europe with an absolute monarchy. Thus, Prince Hans-Adam II was granted the right to appoint and remove members of the government independently. Moreover, the Prince may, under certain circumstances, declare laws passed by Parliament invalid.

The Liechtenstein Constitution specifies that the Principality is structured as a “constitutional hereditary monarchy on a parliamentary-democratic basis. Article 2 of the Basic Law states that the supreme power of the state is concentrated in the Prince and the people. In times of crisis, the Prince can declare a state of emergency (Art. 10 of the Constitution) and actually expand his already considerable powers.

Elements of direct democracy

Similar to Switzerland Liechtenstein knows the tool of approval of bills passed by the Parliament by the people: Thus, after the vote of the deputies 1,000 citizens can demand that a bill be submitted to a popular vote. In addition, 1,000 citizens can demand that Parliament hold a hearing to amend or repeal a law already in force.

1,500 citizens of Liechtenstein can demand new elections to the country’s parliament.

Parliament

The Liechtenstein Parliament consists of 25 members elected by citizens under the proportional system for 4 years. It is noteworthy that if the law passed by Parliament is not approved by the Prince within 6 months, the law is considered rejected.

Government

The government of Liechtenstein consists of 5 members: the head of government and 4 ministers. The members of the government are appointed by the Prince upon recommendation by the parliament.

Liechtenstein on the International scene

Since 1923 Liechtenstein and Switzerland have formed a customs and monetary union. The Principality of Liechtenstein is a member of the United Nations (since 1990), the European Economic Area (since 1992) and the WTO (since 1995). However, the country is not a member of the European Union. In 2008, Liechtenstein joined the Schengen area.

For obvious reasons it is difficult for a dwarf state to maintain diplomatic relations with many states at once. Therefore, Liechtenstein has its own embassies only in Bern, Vienna, Berlin, Strasbourg, Brussels and Washington. In addition, the Principality maintains permanent missions to international organizations in Geneva and New York. Diplomatic and consular relations with other states and territories Liechtenstein maintains through the representations of Switzerland.

Holidays in Liechtenstein

Liechtenstein’s national holiday is August 15. The history of the origin of this holiday is remarkable: on the one hand, the Catholic Principality celebrates the Ascension of the Virgin Mary on August 15; on the other hand, August 16 was the birthday of Prince Franz Joseph II (1906-1989). Due to the proximity of these dates, it was decided in 1940 to merge them into one: August 15. This decision remained in force even after the death of Franz Joseph II.

Every year thousands of people and guests of Liechtenstein gather on the territory of Vaduz castle. The celebration opens with opening speeches by members of the political elite, including the Prince Prince and Head of Parliament, who speak on the lawn in front of the castle entrance.

Everyone is then invited to enjoy drinks and refreshments in the castle’s picturesque gardens. By the way, August 15 is the only day of the year when the gardens are open to the public. Guests can also mingle with the Princely Family, who usually attend the event after the official ceremony.

In the afternoon, the famous fair starts in the center of Vaduz and continues until the morning. The festival itself ends in the evening with a large fireworks display over Vaduz Castle.

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