A Hidden Jewel in the Heart of Europe

Good Morning Ladies and Gentlemen

”The history of high tariffs shows extreme danger: 1890s McKinley Tariff led ~60% EPS drop in S&P 500; 1930s Smoot-Hawley Tariff led 70% drop.”

Societe General

Today’s discourse centres on the Principality of Liechtenstein, a small nation in Central Europe. I have been tasked with composing an article for the Executive Global Magazine, and I am pleased to present the findings and insights regarding this unique country. Through this examination, I aim to explain Liechtenstein’s political structure, economic landscape, and cultural heritage, hoping to contribute to a deeper understanding of its significance in a global context.

The Golden Age

But first, allow me quickly to give you my take on the purported “golden age”, which seems to commence with a pronounced false start, at least economically, marked by a significant deceleration in economic growth. This downturn can be attributed to the erratic policy trajectory of the United States government, which is expected to perpetuate high uncertainty in the financial landscape. Consequently, both investment and consumption decisions are anticipated to remain prudent in the near term. Moreover, the US economy appears poised for a summer slump, exacerbated by the increasingly evident burdens associated with tariff implementation. The current economic climate, characterised by elevated prices and diminished growth prospects, has resulted in a consequential decline in overall prosperity. This situation calls for a thorough assessment and development of strategies to enhance economic conditions. However, recent days have instilled a bit more confidence in me, as it appears that the current government in the U.S. may have paid attention to the markets and business leaders and perhaps even learned from the missteps of its initial 100 days. For my part, I choose to see the glass as half full.

Freedom

But for now, let us dig into today’s topic. Liechtenstein is distinguished by a substantial degree of individual freedom, guaranteeing strong personal asset protection for its citizens. It is also committed to fostering a robust sense of community with a strong awareness of and respect for cultural norms and local customs. Like any healthy and liberated community, Liechtenstein intends to enhance all its members’ overall quality of life. While some individuals may receive slightly less support or financial assistance from the state, this thinking still contributes to the collective well-being of society overall. In such a framework, the government serves its citizens by fulfilling essential duties while respecting their autonomy in decision-making.

Budget Management

Due to prudent budget management and an unemployment rate of only 1.6%, the country enjoys the advantages of having no national debt and reasonably low tax rates for its citizens and businesses. Therefore, the quote by Thomas Sowell, “What exactly is your ‘fair share’ of what ‘someone else’ has worked for?” could easily be attributed to a session in the Parliament of the Principality of Liechtenstein. The Parliament comprises 25 members within a single chamber, with the President and Vice-President elected during the opening session of each new year.

Community

The country enjoys low crime rates, which can be attributed in part to a strong sense of community and, in part, to stringent immigration controls. This is particularly important for such a small state, the sixth smallest in the world with only 39,330 inhabitants, as significant demographic changes could quickly threaten the nation’s identity. The government ensures the provision of essential infrastructure and basic services, allowing citizens to thrive. However, individuals must take the initiative and strive for their success. Short-term thinking is discouraged, and the Princely Family consistently focuses on generational well-being rather than quarterly results.

Full Article

To access the full article, please use the following link to download the PDF:
https://www.incrementum.li/journal/exploring-liechtenstein-a-hidden-jewel-in-the-heart-of-europe/

Ladies and Gentlemen

Feel free to send your messages to smk@incrementum.li.

Many thanks, indeed!

I wish you an excellent start to the day and weekend!

Yours truly,

Stefan M. Kremeth
CEO & Head of Wealth Management
Incrementum AG – we love managing assets

Tel.: +423 237 26 60
Cell: +41 79 303 48 39
Im alten Riet 153
9494 Schaan/Liechtenstein
Mail: smk@incrementum.li