The Austrian Liechtenstein family acquired the fiefs of Vaduz and Schellenberg in 1699 and 1713 respectively, and they became an independent principality under the Holy Roman Empire in 1719 under the name Liechtenstein. The French under Napoleon came unasked and stayed for a few years, but Liechtenstein regained its independence in 1815 within the new German Confederation. In 1868, after the Confederation dissolved, Liechtenstein disbanded its army (of 80 men!) and declared its permanent neutrality.
Liechtenstein's neutrality was respected during both world wars. In 1919 it entrusted its external relations to neutral Switzerland. After WWII, Liechtenstein became increasingly important as a financial centre, and the country became more prosperous and achieved one of the world's highest per capita incomes. In 1989, Prince Hans Adam II succeeded his father to the throne. In 1995, in the light of proposed parliamentary reforms, he threatened that if parliament reduced his role to a symbolic one he would 'cease providing Liechenstein with its head of state' and move on up the road. In 1996, Russia returned the Liechtenstein family's archives, ending a long-running dispute between the two countries, and in 2000 the principality brought anonymous banking to an end. Its 1998 unemployment rate of 1.4% (or 311 people) was indicative of the economy's health.
In recent years the royal family has continued to consolidate its power at the expense of the principality's democratic processes - to the point that some are speculating Liechtenstein may potentially become Europe's only autocracy. A narrow victory in a 2003 constitutional referendum gave the monarchy sweeping new powers, including legislative veto, judicial appointments and the ability to sack governments. The following year Prince Hans-Adam abdicated the throne in favour of his 36-year-old son Alois.
Liechtenstein History
