Travel TipsMonaco

ECONOMY

Service industries, especially property and financial services, account for the bulk of Monaco’s economy. Tourism is also a major source of revenue, contributing about 25 per cent of government revenue, as well as being the mainstay of local retail businesses. There is also a highly successful, custom-built business conference venue. The dearth of land precludes any agriculture, but there is some light industry, the main products of which are pharmaceuticals, plastics, electronics, paper and textiles.
Monaco attracts many extremely wealthy individuals as residents, by virtue of its pleasant climate, reputation and environment as well as the absence of income or inheritance tax and lack of financial reporting requirements. Migrant, non-resident labor supplies the menial workforce. Since the late 1990s, concerted international efforts to tackle the global problem of money laundering and tax evasion have been led by the Organization of Economic Cooperation and Development (the group of 24 leading industrial countries) and its Financial Action Task Force. The FATF has set down a number of criteria covering disclosure which ‘offshore’ financial centers must meet. Most centers have cooperated with the new FATF regime. Monaco is one of seven which, by the deadline in April 2002, had failed to do so: future developments rely on the actions of Monaco’s ruling Grimaldi family (itself implicated in a major fraud inquiry) and the attitude of the French government. Almost all the principality’s external trade is conducted with France – and France, along with Italy, supplies the bulk of Monaco’s visitors (both as tourists and foreign labor).