Liechtenstein - Future trends

The Liechtenstein economy is closely related to the Swiss one and is dependent on the latter's progress towards full integration in the EU. It is likely that, despite financial scandals and constitutional problems, the principality will preserve its sound economy and high living standards and will continue to attract foreign companies and workers in the foreseeable future.

Liechtenstein has already developed close links with the EU through its participation in the EEA, the comprehensive adjusting of its domestic economic regulations to fit the EU standards, and its close relations with the Austrian economy (Austria is a full member of the union). In the event Switzerland finally decides to join the EU, the adjustment of the monetary and banking system (and possibly some agricultural subsidy policies) will likely be among the serious problems facing the small principality in this regard.

As to the problems related to the 2000 banking scandal, there is reason to believe that Liechtenstein can guarantee the implementation of some effective measures to combat money laundering. The former prime minister appointed 4 new judges working at the national court, the prosecution was restructured , the state department for financial services was strengthened, a new Financial Intelligence Unit (FIU) was founded, and a special bank department was set up within the national police force. Some needed legislative changes are being vigorously debated. It is expected that the country's banking practices will be soon brought in line with the general EU provisions, without reducing its competitive advantages too much. The positive ruling by the FATF in June of 2001 indicated the success of these measures.

It is harder to predict the outcome of the constitutional crisis. In 2000, Hans Adam II announced that he would end the discussion around the constitution as soon as possible. But reflecting on his new constitutional proposal of 1 March 2001, the former head of the constitutional commission, Peter Wolff, noted that in the controversial points, on which parliamentary criticism focused, nothing had been changed. Whatever the decision, however, it is not likely to cause any serious political disturbance in the principality that might jeopardize social stability and economic development.