A representative democracy with a constitutional monarch, it is ruled by a grand duke. It is the world's only remaining sovereign grand duchy. The country has a highly developed economy, with the world's highest GDP (nominal) per capita according to the IMF. However, it also suffers the world's highest external debt burden. Its historic and strategic importance dates back to its founding as a Roman era fortress site and Frankish count's castle site in the Early Middle Ages. It was an important bastion along the Spanish Road when Spain was the principal European power influencing the whole western hemisphere and beyond in the 16th–17th centuries.
Luxembourg is a member of the European Union, NATO, OECD, the United Nations, Benelux, and the Western European Union, reflecting the political consensus in favour of economic, political, and military integration. The city of Luxembourg, the capital and largest city, is the seat of several institutions and agencies of the European Union.
Luxembourg culture is a mix of Romance Europe and Germanic Europe, borrowing customs from each of the distinct traditions. Luxembourg is a trilingual country; German, French and Luxembourgish are official languages. Although a secular state, Luxembourg is predominantly Roman Catholic.