Luxembourg began as a hill top fortress in the AD600’s. As you can imagine it has always been a hugely strategic location, between France and Germany. Throughout European history the different countries have spent a lot of time fighting each other (from 1500 until 1800 the big European nations were at war over 50% of the time) and Luxembourg was often in the centre of all this. So Luxembourg became one of the most heavily fortified and blood stained lands in Europe.
Luxembourg has changed hands many times over the years; it has been under the rule of France, Germany, Austria, Spain and Prussia. When the Austrian’s had it, they gave it as a gift to the King of the Netherlands as well as making it a Royal Duchy. This enabled Luxembourg to build it’s own political institutions, so in 1867 it was recognised as a politically independent state. Due to it’s strategic importance it was officially declared to be neutral – so as not to cause problems between France and Germany (they have not always been as friendly as the now appear!) This neutrality was broken when Germany invaded in the first world war, and again in the second WW. Their neutrality meant Luxembourg had no army, so the German’s walked straight into Luxembourg and took it over. The bloody and infamous Battle of the Bulge was fought on Luxembourg soil. After the second world war Luxembourg relinquished neutrality and joined NATO. It was also one of the founding states of the EU.
Today it is a centre of business and banking (Paypal is one of the business’s to be registered there). It has the greatest concentration of banks within the EU, as well as many holding companies – it is a tax haven.
It is also home to some of the following EU institutions:
The Commission of the European Community, including the Statistical Office (EUROSTAT) and the Publications Office,
The Court of Justice of the European Communities
The general Secretariat of the European Parliament,
The European Investment Bank,
The European Court of Auditors.
The Official Publications Office
The Nuclear Safety Administration,
The Directorate-General of ‘Credits and Investments’