VADUZ (Reuters) - The tiny principality of Liechtenstein celebrated its 300th anniversary on Thursday as an island of peace and prosperity in an unsettled world -- and a place where citizens can go drink a beer with their monarch.

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“It is a privilege for me to be able to do that,” said Johannes Allgaeuer, 26, after quaffing a cold one with Prince Hans-Adam II at a garden party outside his castle, perched above the capital Vaduz.

He noted that it was hardly as unusual as, say, an American meeting up with Donald Trump: “We are one big family here. We see a lot of one another. You run into one other a lot.”

What made Thursday’s state holiday so special was that it marked the 300th birthday of Liechtenstein, which nestles in the Alps between Switzerland and Austria and is the world’s sixth-smallest country, with a population of around 38,000.

Some Liechtensteiners had a problem with the ruling dynasty when Hans-Adam, whose wealthy family owns LGT Bank, threatened in 2003 to abdicate if his subjects did not grant him more constitutional powers in a spat over judicial nominees. He won the vote easily.

Now, most citizens solidly back the monarchy, said Manfred Frick, 39, dressed up in a brass band’s uniform.

“Politicians come and go, but the princely dynasty is here forever,” he said.

Prince Alois, the 51-year-old acting head of state and heir to the throne, struck the same tone in a speech to thousands of flag-waving compatriots assembled in an Alpine meadow.

“Our country is among the safest places in the world. The rule of law is firmly established. There is hardly any other country where the individual has as much say in politics,” he said. “We enjoy one of the highest standards of living in the world,” he added, recalling the land was a poor backwater three centuries ago.

German is the official language, though residents mainly speak an Alpine dialect of it among themselves, rather than the formal version. The currency is the Swiss franc. Four out of five residents are Roman Catholic.

Along with Norway, Iceland and Switzerland, it is part of the European Free Trade Association of countries that belong to the European single market without being part of the EU.

The biggest employer is Hilti, a company that makes power tools. The economy is also boosted by financial services, and becoming a hub for crypto-currencies.

Alois, a graduate of Britain’s Sandhurst military academy, is the son of Hans-Adam and grandson of Franz Josef II, who moved the family from Vienna in 1938 to lands an ancestor had bought to gain a seat on the Holy Roman Empire’s council of princes.

The prince’s veto power makes the monarchy one of the few in Europe with political authority, although Liechtensteiners have the right to hold a referendum to revoke their confidence in the prince should at least 1,500 citizens support the idea.

Thursday’s official celebration caps a year of festivities that include a contest to pick an anniversary song. The winning entry was “This is Where I Belong”.