Economic crisis and regeneration

Hit hard by the First World War, the economic model of the Principality was facing great difficulties. Although Monaco turned into a year-round resort, the effects of the crisis of 1929 further reduced its clientele. The State took over various public services previously financed by the Société des Bains de Mer. Although the dynamic cultural and sporting life of the Principality continued, lack of employment was beginning to create discontent in Monegasque society. Priority for employment was given to Monegasques who, faced with the growth of the resident population, were fighting to preserve their national identity, particularly through protecting their local dialect.

On a financial level, a system of tax breaks was established with the introduction of the principle of privileged residence. Furthermore, a special status was awarded to holding companies in 1934. In 1932 the tax agreement with France was renegotiated and in 1937 the Stamp Issuing Office was established, allowing for diversification and growth in state revenues.

Economic constraints, austerity measures and the growth of the French Front populaire were at the root of various cases of social unrest. The introduction of paid holidays for workers, on 7 April 1937, was not enough to calm the clashes, which continued until September.