With an area of 160 km², the Principality of Liechtenstein is the fourth smallest state in Europe, but is one of the richest countries in the world. The country lies on the border between Austria to the east and north (Vorarlberg) and Switzerland to the west and south (cantons of Sankt Gallen and Graubünden).
The landscape is characterised by the foothills of the Northern Limestone Alps (Rätikon with the Upper Samina Valley and the Malbun and Valorsch side valleys) and the eastern valley plain of the Alpine Rhine. In total, around two thirds of the country is covered by mountains, the highest mountain being the Vorder-Grauspitz with 2599 m. The valley plain of the Alpine Rhine, which represents the western border of the country, lies at an altitude of about 450 m above sea level. Here, individual mountains rise, such as the Schellenberg (also called Eschener Berg, about 700 m).
The climate in Liechtenstein is cool and temperate. In the state capital Vaduz, the average January temperatures are around -1 °C, in the summer an average of 17.5 °C is reached. In the valley plain of the Alpine Rhine, the temperatures are somewhat higher. Typical climatic phenomena in Liechtenstein are the warm foehn winds, some of which can also reach storm strength. While the average precipitation values in the valley plain are approx. 850 mm per year, up to 2 400 mm are reached in the ridges of the mountains.
Liechtenstein has about 35,000 inhabitants. About half of the inhabitants live in rural areas in smaller settlements, above all the valley plain and the Samina valley are more densely populated. The cities of Schaan and Vaduz (capital), which are only about 3 km apart, are the largest cities in the country with 5,600 and 5,000 inhabitants respectively.
In addition to the 61.6% Liechtenstein population, about 15.5% Swiss, a good 7% Austrians and 3.5% Germans live in the country, whose official language is German. The people of Liechtenstein speak an Alemannic dialect. Since the end of the 60s of the 20th century, the population has increased by about 50% due to immigration from neighboring countries. The majority of the country’s inhabitants belong to the Christian faith, predominantly the Roman Catholic Church (76%).
As one of the richest countries in the world, Liechtenstein has a very high standard of living and education. The life expectancy of women is 83 years, that of men 76 years. The population growth of 0.8% is mainly due to the immigration of foreigners.
The Principality of Liechtenstein is a constitutional hereditary monarchy on a parliamentary-democratic basis. It is based on the Constitution of 1921 with subsequent amendments. The head of state is the Prince (since August 2004, Hereditary Prince Alois Philipp Maria as deputy to Prince Hans-Adam II, who remains Prince), who appoints the government on the recommendation of the 25 members of the Landtag (Parliament). Head of government since March 2013 is Adrian Hasler. The Prince can dissolve Parliament and sign all laws before they come into force. The members of parliament are elected every four years.
The two most important parties are the Progressive Civic Party (FBP) and the Patriotic Union (VU). The legal system is based on Swiss law. In terms of foreign policy, the country is mostly represented by Switzerland. Liechtenstein is divided into eleven municipalities.
Liechtenstein’s economy has been closely linked to Switzerland since the currency and customs union of 1923/24. Since 1981 (Currency Treaty), Swiss monetary, credit and currency laws have applied (the common currency is the Swiss franc). In contrast to Switzerland, Liechtenstein has also been a member of the European Economic Area (EEA) since 1995.
Liechtenstein is one of the most important international banking and financial centres. The high share of the service sector, which accounts for more than half of the gross domestic product (GDP), is largely due to financial services. Economic growth amounted to 1.4% in 2012.
Today, only just under 1 % of all gainfully employed persons are employed in agriculture. Its share of GDP is correspondingly low (7 %). The cultivation areas for potatoes, wheat, maize and fruit are mainly located in the fertile valley plain and in the low altitudes of the mountains. In the higher altitudes cattle breeding and dairy farming are practised.
The transformation of Liechtenstein from an agricultural to an industrial country began at the end of the Second World War. The domestic industry profited from the capital of foreign investors, who were attracted by tax breaks. About 40% of the total workforce is employed in industry, which also accounts for 40% of GDP. The most important sectors are mechanical and electrical engineering, whose products are also the main export goods. The chemical industry is also important. As the small country has virtually no raw material deposits, raw materials and about two thirds of the energy required have to be imported. The most important trading partners are the EU states (above all Germany and Austria) and the USA.