Today, gambling on some levels has relatively little to do with the Monegasque economy.

Historically

Historically, gambling essentially drove the initial business into town, so to speak. Once Monte Carlo existed as a railway stop along the Genoa-Nice line, Europeans began to arrive. The spectacle of the casinos and the Opera House were intended to appeal to those seeking luxury and elegance away from home. The climate of Monaco did not hurt the economy, either. The region’s mountainous rise protects the small Principality from the mistral winds of the region. The climate remains mild in the winter and very warm in the summer.

In the gambling heyday, Prince Charles III did away with nearly all forms of taxation. This direct result of gambling wealth and power relates directly to the current Monegasque economy.

Tax-Free

Monaco has a system of taxes these days, but in comparison to the rest of the world, Monegasques have very few taxes to pay their government. Over the years, Monaco has come under direct fire for conspiring to lure business and industry under the auspices of a tax-free economy.

Further accusations of money laundering and poor banking practices have pitted France against Monaco on a number of occasions. The fact is that Monaco’s system of taxation, in combination with its status among the European elite, and as a destination resort for millions of tourists annually, has made it attractive for foreign investors and wealthy retirees who need an inexpensive—and beautiful-- place to bankroll their wealth.

Of thirty thousand or more residents of the Principality, only about a quarter of them is native Monegasque.

Current Economy

Monaco is still often marketed by businesses as a tax haven, an investment destination, a wise place for foreigners to set up shop. Two of the quarters of the Principality, La Condamine and Fontvieille are primarily business and industry areas of the city.

Although Monte Carlo’s current gambling business is run by a private corporation and no direct revenue is gleaned by the Principality, the results of the gambling business do have a direct effect on the economy. Because of the world famous casinos, Monte Carlo has become a tourist destination for millions of well-to-do travelers. It is these wealthy patrons who propel the local economy.

Even now, Monaco has become a port-of-call for some of the large cruise lines. Cruise vacationers not only gamble, but they dine, enjoy the beaches, sight see and shop.