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Why is Liechtenstein one of the Safest Financial Centers in the World?

Updated: Jan 17

The political, economic, and legislative conditions create an environment of stability that makes the Principality of Liechtenstein one of the safest financial centers in the world.

Liechtenstein is one of the safest financial centres
Vaduz, capital of Liechtenstein. Canva.

Located between Switzerland and Austria, this small State of 160 km2 is one of the most prosperous nations in the world. In fact, its population, of around 39,000 inhabitants, has the highest purchasing power in Europe (around 186,000 euros per capita).

Although best known as a financial center, Liechtenstein also owes much of its wealth to its growing and competitive manufacturing industry, which specializes in high value-added products such as dental prosthetics, connectors, and car steering systems. This industry, which began to develop in the 1950s, is the source of 47% of the Principality's economy.

Politics: A Particular System

Liechtenstein is a constitutional hereditary monarchy based upon democratic-parliamentary principles. In other words, Prince Hans-Adam II Von Liechtenstein, head of state, shares and exercises the sovereignty of the country with the citizens, who have the possibility of proposing legislative texts; in addition, any law approved by the Parliament can be submitted to a referendum. This model provides continuity and political stability.

Economy: A Dynamic Business Environment

The Swiss franc, one of the strongest and most stable currencies, is the official currency of Liechtenstein. Additionally, the Principality also shares a customs union with its neighbor Switzerland, which allows it to easily export its specialized products.

The business landscape of this microstate is highly dynamic. This is confirmed by its impressive ratio of companies per person: For every citizen of Liechtenstein, there are about 8 active companies. In fact, more than 57% of its workforce is made up of frontier workers. The government invests 7% of its Gross Domestic Product (GDP) in research and development, further strengthening the business sector.

The Financial Sector: Stability in Innovation

The financial sector represents 21% of Liechtenstein's economy, serving clients from around the world who are attracted by Liechtenstein's financial soundness reflected in the AAA rating (the highest on the scale) awarded by Standard & Poor's, the global financial rating agency.

The solid legal framework drives the sector, for example, Lichtenstein was the first country to implement a legislation to regulate the token-economy (“Blockchain Act”), thus creating legal certainty in this field. Likewise, financial market participants in Liechtenstein are supervised by the Financial Market Authority (FMA), which ensures its stability, and the protection of its clients.

Contrary to the misplaced myth that evades international regulations, as part of the European Economic Area since 1995, Liechtenstein applies the same strict regulations as all other members of the European Union.

The political, economic, and legislative conditions create an environment of stability that makes the Principality one of the safest financial centers in the world. Its areas of expertise include asset management, storage, and preservation.

Aktagold's mission is to help middle-class individuals protect themselves against the economic and financial instability in their home countries by giving them access to gold savings in Europe's most secure vaults, located in Liechtenstein, an option previously considered reserved to those with the highest income.

Learn more about our protection plans here.

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