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Principality of Lichtenstein

Lichtenstein is a small country in Europe, situated on the foothills of the Alps in the Rhine valley. Its immediate neighbors are Switzerland (common border of 41.2 km) with whom Lichtenstein is narrowly linked economically and politically and Austria (common border of 36.7 km). Liechtenstein is a principality, not a duchy. With a population of 34,761 (July 2009 est.), Liechtenstein is the smallest German-speaking country in the world.

Lichtenstein’s constitution from 1921 designates Lichtenstein as a hereditary monarchy based on democratic and parliamentary fundaments. The present Duke is Hans Adam II, reigning from 1989. The Lichtensteins had lived primarily in Moravia (the Czech Republic) and in Vienna Austria, which they left ahead of the Nazis in 1938, when the duchy became their permanent home.

Liechtenstein abolished its military in 1868 and stayed neutral in the First and Second World Wars. While Liechtenstein has no military forces, it is interested in European security policy and is an active member of the Organization for Security and Cooperation in Europe (OSCE). Liechtenstein pursues an independent and active foreign policy. The country maintains close bilateral relations with many States and engages in multilateral cooperation at the regional and global levels, especially through its membership in international organizations.

The main responsibilities of Liechtenstein foreign policy are the defense of the independence and security of the country and the conduct of its relations under international law. The focus is on the cultivation of bilateral relations with other States and multilateral cooperation in international organizations. The guideposts of international cooperation are the representation of the country’s own interests, the protection of Liechtenstein citizens, and solidarity with the international community. Liechtenstein is therefore particularly engaged in human rights policy, the progressive development of international law, development cooperation, international humanitarian assistance including disaster assistance and assistance, and specific areas of international environmental policy.

The GDP in market values is (2005) 80800 € per resident which is among the highest in the world. The GDP is generated by industry and product manufacturing (39%), services, (25%), financial services (29%) and agriculture (7%). Overall, Lichtenstein’s economy employs total of 30,170 persons, of which 20,035 are foreigners who came to work in Lichtenstein, principally from Austria and Switzerland. Lichtenstein’s economy is export oriented for the European economic area (44%), Switzerland (12%), USA / Canada (18%) Asia (24%), and others (2%).

Lichtenstein’s foreign trade balance is strongly active. The often mentioned banking represents more than a quarter of its GDP and consists of banking houses, employing more than 1700 employees. The banks manage clients’ assets exceeding 155 billion Euros. Further, there are 163 investment companies with assets of approx. 21 billion Swiss Francs and 31 insurance companies.

The history of Liechtenstein as the Principality of Liechtenstein began in 1719, when Emperor Charles VI unified the Lordship of Schellenberg and the County of Vaduz and elevated them to an Imperial Principality by the name of Liechtenstein. In 1806, Liechtenstein became a member of the Confederation of the Rhine and obtained sovereignty, which it has maintained until today. In 2006, Liechtenstein celebrated 200 Years of Sovereignty of the Principality of Liechtenstein. The history of the House of Liechtenstein extends far back into the Middle Ages. The Family of Liechtenstein is one of the oldest Austrian noble families. In 1136, Hugo of Liechtenstein was the first bearer of the name to be mentioned in documents.

The country has a strong financial sector and has been identified as a tax haven. It is a member of the European Free Trade Agreement. Liechtenstein is not part of the European Union and has shown no interest in joining.

According to the Constitution, the Principality of Liechtenstein is a constitutional, hereditary monarchy on a democratic and parliamentary basis with power shared between the Reigning Prince (hereafter the Prince) and the people. The Prince is the Head of State and is vested with extensive powers. The Prince has the authority to appoint and dismiss the Government, dissolve the parliament, appoint judges, and sanction all laws and acts adopted by referenda.

Voters enjoy broad democratic rights and can launch popular initiatives and initiate referenda to amend laws and the Constitution. They can also submit a motion of no confidence in the Prince, to abolish the monarchy, to convene the parliament, and to elect judges in cases of disagreement between the parliament and the Prince. Executive powers are vested in the government, a collegial body consisting of a head of government and four ministers. The members of the government are appointed by the Prince on the proposal of the parliament and with its concurrence.

Legislative powers are exercised by the parliament (Landtag) elected by popular vote for a four year term. The parliament is elected under a proportional representation system from 2 multi-mandate constituencies; 15 members are elected from the Upper Country (Oberland) and 10 from the Lower Country (Unterland). The current distribution of seats per constituency was introduced in 1988 and sought to protect the interests of the smaller Lower Country by assigning it more seats than it qualified for based on its population.

The parliament has 25 seats and its members serve on a part-time basis. In the last several decades, the political landscape has been dominated by two parties, the PCP and the PU, usually ruling in a coalition. Since 1930 there have been only few instances in which one party obtained an absolute majority. The FL and Independents appeared on the political scene in 1985 and 2013, respectively.

Following the 2013 elections, 10 seats in the parliament were held by the Progressive Citizen’s Party (PCP), 8 by the Patriotic Union (PU), 4 by the Independents (DU) and 3 by the Free List (FL). Women held only six seats in the outgoing parliament.

In the country of fewer than 38,000 inhabitants, ballots are open for only 90 minutes on Sunday. However, most people vote by mail. On 5 February 2017, voters elected 25 members of parliament for a 4-year term. The parliament is elected under a proportional representation system from two multi-mandate constituencies. The law assigns more seats to one of the constituencies than it qualifies for in proportion to the number of voters there, which potentially affects the equality of the vote. Seats are allocated to contestants that obtain at least eight per cent of valid votes countrywide, which is one of the highest thresholds in the OSCE region.

For decades, the Progressive Citizens' Party (FBP) and the Patriotic Union (VU) have formed governments in the wealthy principality, which is wedged between Austria and Switzerland. The election of Liechtenstein's 25 MPs on was also expected to decide on the political fate of Prime Minister Adrian Hasler, the FBP leader. According to the results, he might have to cede the post to his current deputy, Thomas Zwiefelhofer of the VU.

The conservative party of Liechtenstein's Premier Adrian Hasler may have come out on top in the European microstate's parliamentary vote on Sunday, but exit polls showed it suffered a blow to its mandate. Hasler's Progressive Citizens' Party (FBP) received 35.2 percent of the vote, losing nearly five percentage points. The party now had nine seats in the 25-member legislature, down from 10 seats. Support for FBP's conservative coalition partner, the Patriotic Union (VU) rose slightly to 33.7 percent, granting it an unchanged eight seats in parliament.

The Liechtenstein royal family continued to wield ultimate authority. The regent, Prince Alois, has the power to suspend parliament and dismiss the government, and he can veto bills. The royal family's political power is backed by financial muscle. They own the LGT, the world's largest family-held private bank, which manages assets totalling 143bn Swiss francs ($144bn).




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