Because of its local rulers’ connections to the Habsburg monarchy, Liechtenstein was aligned with Austria until 1919. From 1923, as a result of a customs treaty, the country has had close administrative and economic ties with neighbouring Switzerland. The Swiss franc was also introduced as the currency of Liechtenstein at that time. These measures had a very positive economic impact, although Liechtenstein saw no strong upturn until after the Second World War.

For the duration of the treaty, no taxes may be levied and no restrictions or prohibitions on imports and exports may be enacted by either side at the Swiss-Liechtenstein border. Liechtenstein has one of the highest industrial ratios in the world, with around 41 percent of gross value added generated by industry and the goods-producing sector.

Like Switzerland, Liechtenstein is a member of the United Nations (UN) and the European Free Trade Association (EFTA) but not of the European Union (EU); unlike Switzerland, Liechtenstein is part of the European Economic Area (EEA).