Although the second-smallest independent state in the world, Monaco benefits from an excellent climate and beautiful settings on the Côte d'Azur. From the heights of the Tête de Chien or Mont Agel, or from lower down from the Moyenne-Corniche at the level of the entrance to the Jardin Exotique, there are a number of panoramic viewpoints looking out over exceptional scenery. Gamblers flock to the Place du Casino in Monte-Carlo and every May the principality hosts the renowned Monaco Grand Prix. Monaco is also well located for exploring both Provence, the French Riviera and Italy.

In the main harbour, expensive luxury yachts and boats, which are a permanent fixture, corroborate Monaco's reputation as a glamorous destination for the rich and famous. Monaco's pleasant climate, reputation and environment as well as the absence of income or inheritance tax and lack of financial reporting requirements all contribute to this situation. Tourism is also a major source of revenue, contributing about 25% of government revenue, as well as being the mainstay of local retail businesses.

The history of Monaco is inseparable from that of the House of Grimaldi. At various times, they were to be found allied with almost every power in the region, particularly during the Italian wars in the late 15th and early 16th centuries. Monaco’s geographical position left them ideally placed to either help or hinder the repeated and largely unsuccessful attempts by the kings of France to conquer Italy. This Machiavellian approach – indeed, Machiavelli himself was in Monaco in the early 16th century to sign a treaty on behalf of Florence – paid dividends in 1612 when Honoré II was granted the title of prince by the French crown. He signed a treaty of friendship with France, and the Principality remained independent from that time on, despite a brief interruption during the French Revolution. The family’s motto – ‘Deo Juvante’ (With God’s Help) – provides another possible explanation for the survival of this tiny country. Monaco became an independent state under French protection in 1861.

Monaco survives principally by providing tax concessions and discreet banking facilities for wealthy foreigners, and this has recently led to spats with France and difficulties with the wider world. Despite being ‘named and shamed’ by inclusion on an Organisation for Economic Cooperation and Development blacklist of seven countries that have failed to take adequate measures to deal with the money-laundering and multi-national fraud problems in 2002, Monaco attracts many extremely wealthy individuals as residents.