Thinking big: Liechtenstein's art deal with China

Liechtenstein, as everyone here is quick to tell you, is a very small country. It's the sixth smallest in the world (Vatican City is No1). The pair of statistics you hear quoted most are that it measures 160 square kilometres and has 35,000 inhabitants, but here's how truly small it is - it doesn't have a Starbucks. On a map you'll find it, after some searching, squeezed into the Alps between Switzerland and Austria, an unexpected knobble of nougat amid the chocolate slopes of a Toblerone bar. Not only does it lack a train station and an airport, it's doubly landlocked: its inhabitants have to cross two countries before they get to dip their toes in the sea.

A nation so tiny might be considered at risk of developing a Napoleon complex, but Liechtenstein believes in facing up to the size issue head on. The managing director of Liechtenstein Marketing, the country's tourism board, humbly agrees with a casual observation that his country is about the size of Beijing airport. (Beijing airport actually covers an area of about 24 square kilometres). The board's standard publication is called The Principality of Liechtenstein - Encounter with a Small State, and a media presentation given in the capital, Vaduz, by the minister for social affairs, is titled "Small is Beautiful". The event takes place in the main (small) government building and the minister - one of Liechtenstein's five cabinet members - affably dispenses glasses of water among his audience before listing some of the (not terribly big) items (stamps, artificial teeth, Swarovski crystals) with which Liechtenstein is associated.

His listeners are from the mainland Chinese media; they are visiting Europe in order to acquaint themselves with Liechtenstein's princely collections, which are held in two palaces (both in Vienna, Austria) and one castle (in Vaduz). Liechtenstein's ruling family has lent China 100 works by Rubens, van Dyck and other Flemish masters, for an exhibition: "Masterpieces from the Collections of the Prince of Liechtenstein" opens on Tuesday in Beijing's National Museum of China and will travel on to Shanghai's China Art Museum in March. A trade delegation accompanied by His Serene Highness Prince Alois, son of the current head of state, His Serene Highness Prince Hans-Adam II, will be present at the Beijing opening.

It doesn't take a massive intellect to conclude that this meeting of royal-sanctioned capitalism and state-run communism isn't simply about art. The exhibition is sponsored by LGT Group, an international private banking and asset-management com-pany owned by the Princely House of Liechtenstein, which is also its biggest client. (The family's investments with LGT are worth three billion Swiss francs, or about HK$26 billion.)

The government's official handout lists Liechtenstein's famed financial advantages as including "a traditionally protective attitude to private wealth and personal privacy". In recent years, however, less-polite observers in the European Union and the United States have taken to using the words "tax evasion", and the repercussions have been on the large-ish side - in July, for instance, the country's oldest bank, Liechtensteinische Landesbank, was obliged to pay US$23.8 million to avoid criminal prosecution in a US tax case.