Learn about Monaco A Golden Microstate on The World Map – Every 3rd Resident is a Millionaire Here!
Monaco is a country that’s smaller than New York’s Central Park, but it’s full of glamour, luxury, and excitement. Around every corner you will find evidence of the riches that spoil this entire tiny nation, from the designer boutiques to the five star hotels, stretched out yachts, and luxury vehicles. This small country has become a haven for millionaires and billionaires in more ways than one. But how did it get to be so rich and how rich are we even talking. We are going to look at this alluring nation today and answer these questions, but first a little background.
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Since the main thing everyone knows about Monaco is that it’s a wealthy nation, here are some fast facts for you to learn more about the background of Monaco. Monaco is an independent nation and a constitutional monarchy located on France’s Mediterranean coast on the French Riviera.
It has been ruled by the Grimaldi family for over 700 years, and it is currently ruled by Prince Albert II. It achieved its independence from the Republic of Genoa on January 8th, 1297, although it was claimed by the Kingdom of Sardinia and then France for a time in the 1800s. Monaco is less than one square mile, which makes it the second-smallest nation in the world next to the Vatican.
Monaco is the host of the world-renowned Monte Carlo Casino and the Monaco Grand Prix Racing Track. Both attractions are top-rated, and they generate a lot of income for the tiny but mighty principality. Natives of Monaco are referred to as Monegasque [mon-uh-gask], while someone born in a different country who resides in the area is called a Monacoian [mon-uh-co-en].
This country is unusual in that its native people have become the minority there, while rich foreign playboys, executives, and billionaires now compose most of its residents, but it wasn’t always this way.
How Monaco Became Rich
Monaco wasn’t always a mecca for millionaires. In fact, less than 200 years ago, the nation was on the verge of bankruptcy. In 1861, Monaco regained its sovereignty after a period of being ruled by the French. But the country was struggling financially, largely because two of their towns—which made up 95 percent of the principality—declared their independence and stopped paying taxes in 1848.
Charles III was the ruler at the time, but it was his mother, Princess Caroline, who came up with the idea that made the nation what it is today. She thought a casino would be a great way to increase tourism and bring additional revenue to Monaco.
The first casino that was built failed largely because it was difficult to access Monaco from Europe. But the famous Monte Carlo Casino opened in 1863 in an ideal location and immediately began bringing in revenue for the principality, which greatly increased when a railway was built connecting Monaco to France.
The casino was so successful that Monaco was able to abolish all income taxes in 1869, which soon brought it to the attention of the wealthy. To ensure that this investment would only be a positive thing for their citizens, native residents of Monaco are not permitted to even set a single foot inside of the casinos unless they need to go there for work. Monaco law excludes the wealthy foreign nationals who live in the principality, which is nearly 80% part of the population.
Today, the Monte Carlo Casino, the Hotel de Paris in Monte Carlo, the Opera de Monte-Carlo, and 55 other properties are owned by the Societe des Bains de Mer [Sosi-eh-tay day Banes day Mur], or SBM. The people of Monaco, the Government of Monaco, and the House of Grimaldi each own about a third of SBM, and the success of this company is the primary reason why Monaco is so rich today, but that doesn’t completely explain why so many wealthy people have chosen to move there.
Why the Rich are Drawn to Monaco
We mentioned a bit ago the number one reason wealthy people are drawn to Monaco—zero income taxes is beautiful music to a rich person’s ears. Of course, what attracts so many wealthy people and businesses to Monaco is the dream many of them share of holding onto the majority of their wealth for as long as possible. This country is a miser’s paradise that pulls in tons of residents and tourists from over 100 different nations year-round.
But there are other reasons Monaco is an ideal place to live. It offers mild weather year-round. It’s politically stable, and its schedule is always jam-packed full of exciting and flashy high-profile attractions like the Grand Prix of Monaco and the Monte Carlo Casino, which was made even more popular with its mentions in the James Bond film series.
The country is very accessible, has its own posh airport, and is just a hop, skip, and a jump away from France’s border. The country is also among the safest in the world with the largest police force in the world per capita and a 24 hour video surveillance system that covers every inch of the principality. And other thing—the country has zero debt, so its economy is among the most secure in the world.
Real Estate in Monaco
Monaco is literally the most expensive city in the world from a real estate perspective, according to the most recent Wealth Report done by the London-based real-estate giants at Knight Frank’s firm. They stated that the going rate per square foot for property in Monaco is shockingly somewhere around 6,000 dollars per square foot!
The high number of extraordinarily wealthy residents in Monaco is the cause of the sky-high real estate market there. Another major factor is the small land area and the high demand for residential properties. This pushes property costs to off the charts status.
The more highly desired properties in Monaco sell for about 9,000 dollars per square foot, which is 50% more than even the most expensive and desirable locations in the United States, such as New York City and San Francisco. Let’s put that in perspective: one million dollars will only buy you about 111 square feet of residential space in Monaco.
It is the most densely populated sovereign state in the world. As of 2019, about 37,500 people live in Monaco—and that’s on land that is less than .78 square miles. So now we get to the question we’ve been building up to.
How Rich is Monaco
There are a few different ways we could define how rich Monaco is, so let’s start with the GDP. Monaco’s GDP is about 6 billion dollars, which is on the lower end for countries around the world, but of course you have to take into consideration how small the nation is as well.
That’s why it’s more helpful to look at the per capita GDP, which for Monaco was around 185,000 dollars in 2018. To put this in perspective, let’s compare this to the three countries with the highest overall GDPs. In 2017, the United States’ per capita GDP was 59,530; China’s was 8,827; and Japan’s was 38,430.
This is one reflection of the wealth of the nation, but let’s look at how rich the individual people there are. Approximately 32 percent or one out of three people living in Monaco are millionaires. Ultra-high-net-worth individuals are considered to be anyone with a net worth of at least 30 million dollars.
Monaco has at least 210 residents who fall in this category with a combined net worth of 25 billion dollars. There are also four billionaires living in the small principality. The combined wealth of those four people equals out to 7.1 billion dollars, which is 117 percent of the entire GDP of Monaco. Take a look at this chart to see just how remarkable this is.
This chart shows what percent of the GDP the billionaires of each country represents. You can see that Monaco with its red and white flag in the top right corner is in a league of their own with that statistic.
The wealth of Monaco’s inhabitants is also evidenced by the cars they drive. As we’ve mentioned, it’s a tiny country, so a car is hardly necessary, but that doesn’t mean there’s any shortage of luxury vehicles roaming around.
The highest-selling car in 2017 in Monaco was the Smart Fortwo, but this is more of a practical choice since parking spaces are hard to come by. After that, the top car choices get much more luxurious with the top-sellers being the Porsche Macan, the Range Rover Sport, and the Bentley Continental GT. The average wealth of a resident of Monaco is around 2.1 million dollars.
Prince Albert II, on the other hand, has an estimated net worth of one billion dollars. There are around 12,260 total millionaires that live in Monaco.
It is difficult to put an exact number on how rich Monaco actually is because the country does not report official economic statistics or national income figures. With that being said, the figures that are known point to Monaco being one of the most affluent independent nations in the world in terms of per capita GDP and individual wealth of residents.
Monaco is not a place for the rich who are seeking some privacy away from the spotlight. It’s a place for the wealthy to flaunt their riches and live their best life in an exciting and luxurious atmosphere with others who are just as rich.
From the enchanting nightlife to the thrill of the casinos and the breathtaking view of the French Riviera from the deck of a superyacht, there is no other place in the world quite like Monaco. Also, with zero debt and a thriving economy and tourist sector, it looks like Monaco will be able to maintain their wealthy status for years to come.
In fact, it’s estimated that by 2026 Monaco will be home to 16,100 millionaires and 1450 ultra-high-net-worth individuals, so you need to get on your game if you want to be counted in those numbers.
Now that we’re wrapping up, we’d like to know: What would draw you most to Monaca as a millionaire—the tax haven status, the atmosphere, the safety and security, or something else? Let us know what you think in the comments.