With no natural resources and a small domestic market, foreign trade is of major importance to Liechtenstein's economy.
Liechtenstein's small size means that it is not able to produce everything it needs. However, the domestic market is also not able to consume everything produced in the Principality. Therefore, import and export are key to the economy, with many more goods and services exported than imported.
Thanks to a range of international agreements, Liechtenstein has managed to create optimal economic conditions through access to important markets. The country has been a member of the European Economic Area (EEA) since 1995. Companies benefit from the advantages offered by the EU/EEA single market, first and foremost the free movement of people, goods, services and capital. Special provisions on the freedom of movement and freedom of establishment exist as a result of Liechtenstein's particular geographical situation.
The Principality of Liechtenstein is also a member of the European Free Trade Association (EFTA) and benefits from one of the world's largest networks of free trade agreements. Since the conclusion of the Customs Treaty in 1923, Liechtenstein has shared a common customs area with Switzerland, meaning that bilateral free trade agreements between Switzerland and other countries also apply to Liechtenstein. The Swiss franc is the official currency in Liechtenstein.
In an interview, the Liechtenstein historian Rupert Quaderer-Vogt explains that by signing the Customs Treaty of 1923, Liechtenstein laid the foundations for its economic boom in the following decades.