Once upon a time there was a pocket-sized fairy tale kingdom overlooked by student backpackers and glamorous globetrotters alike. Nestled between France and Germany, Luxembourg’s green pastures beckoned as my plane began its descent.

This Christmas, I visited the country for the first time staying just outside its capital – Luxembourg City. A clear Parisian influence plays out across the cityscape which is dotted buildings akin to those you might see in Berlin. The bigger picture, however, is distinctly Luxembourgian. The national narrative leaves little to the imagination as to why so many European styles and tastes seem to be at play. Luxembourg’s history – one of continual invasion, occupation and ill treatment at the hands of its larger border nations – can be seen throughout its capital. But a unique sense of self is clear, whether in spite of or because of its rich history.

Like our own small isle, Luxembourg’s international prestige and sense of identity is aided by its Grand Ducal family. The royal family are heavily involved with the country’s diplomatic and domestic affairs, one of the reasons for their wide popularity. The Grand Ducal Palace in the centre of the city is indeed grand, with its clean stone façade and sharp French chateaux-style spires. Yet it is invitingly accessible and can be viewed from the delights of a little chocolate house (a café dedicated entirely to hot chocolate and other cocoa treats), across the street. Outside its main entrance is a little box, in which appears a guard-keeper dressed in military red, if the Grand Duke is present.

Winding through the streets I felt at once in a capital cosmopolitan city ornamented with golden Christmas lights woven around traditional lampposts and box bay windows. The cobbled streets, devoid of traffic, make walking a leisure for no purpose other than to absorb the city’s character. There is no rush, no bustle. But that’s not to say the city is quiet. The mix of languages the citizens and visitors speak is testament to Luxembourg’s international character. Most citizens speak French, German and Luxembourgish but this list is not exhaustive.

Luxembourg’s history is intertwined with its European neighbours. Ruthlessly occupied by the Nazis during the Second World War, the oldest part of the city, the ‘Grund’, was home to its residents. Flanked by the ancient city wall, which is punctuated by turret-like windows, the houses of the Grund overlook the river. With beamed walls and slated rooves, they were adorably similar to those in the provincial town of Disney’s Beauty and the Beast. This part of the town is not ornamental, it is residential and the number of restaurants and cafes give it a well lived-in feeling. Also oddly it happens to be a centre of nightlife. The Grund may be holding onto some of the most ancient fragments of Luxembourg’s history but it is enjoyed as more than a relic of preservation.

It does not take long to get out of the city into charming villages and countryside. 33.6% of Luxembourg’s land is covered by forests and it is one of the few countries where this is actually increasing annually.

Such positive results, I believe, are at the heart of Luxembourg’s good governance. My hosts explained to me that as Luxembourg is one of the smallest nations (population of almost 600,000) it makes efficient and effective government more attainable. Luxembourg has successfully implemented many environmentally green policies and a walk around Luxembourg City is testament to the low numbers of homelessness.

A drive into the countryside reveals enchanting forests in the midst of which is enclosed Vianden Castle. Vianden dates from the 11th century and has a rich history of royal and aristocratic ownership. It watches over the winding streets of the village below that circle the rock of the castles foundation and lead like its own river to the water below, seeping into the shelter of the forest. The quaint houses of shuttered windows and pastel paint demonstrate their character with external pipes wrapped up in colourful knitted wool to keep them from freezing.

With such charismatic multi-culturalism, reducing environmental impact and good social programmes, is the small (but perfectly formed) kingdom the way to go?