LUXEMBOURG, Oct 2, (AP):A monarchy at the heart of Europe is preparing for a generational change. Grand Duke Henri of Luxembourg will abdicate the throne on Friday after 25 years as head of state in favor of his eldest son, Guillaume. Henri has filled the largely ceremonial role of grand duke alongside his Cuban-born wife, Grand Duchess Maria Teresa, as the government steered the country through troubles like the 2008 financial crisis, the greatest shock to Luxembourg’s economy since the 1970s.

The tall and reserved 70-year-old Henri was educated in France, Switzerland and at the United Kingdom's military academy Sandhurst. His 43-year-old son followed a similar path - going to school in London, Switzerland, France and Sandhurst before working in Belgian, German and Spanish firms. He is married to Belgian-born Countess Stéphanie de Lannoy; they have two sons, aged 5 and 2.

After his father abdicates in a ceremony at the Grand Ducal Palace, built of yellow stone and decorated with spires and ironwork, Guillaume will be crowned and then swear an oath to Luxembourg's constitution before the 60 elected members of the Chamber of Deputies, the duchy's parliament. After taking over from his father, Guillaume will tour the small nation, about the size of Rhode Island, and end with a Sunday mass with Archbishop Jean-Claude Hollerich at the Catholic Notre-Dame de Luxembourg cathedral.

One of the European Union's smallest nations and its richest per capita, Luxembourg is a financial powerhouse that hosts important EU institutions like the European Court of Justice and the European Investment Bank. The grand duchy is home to many of the banks in the eurozone, reinsurance companies, and managers of hedge funds and money markets.

Its economy is strong, with virtually no unemployment. Cleaved from what is now France, Belgium and Germany in the 17th and 19th centuries, the small nation is a parliamentary democracy with the grand duke as head of state, akin to King Charles in the United Kingdom or King Philippe in Belgium. Roughly 700,000 citizens speak a mix of Luxembourgish, a Germanic language, and French and German in public life.

Also widely spoken are English and Portuguese. Many people fled to Luxembourg from Portugal during the dictatorship of António Salazar in the 1960s. Guillaume will be Luxembourg’s seventh grand duke since 1890, when the modern monarchy was established. Complex royal politics, as well as the loss of significant territories over the centuries, has meant Luxembourg is not a kingdom. It is the world's last remaining grand duchy.

Henri laid out the challenges ahead for Guillaume and Luxembourg in his last Christmas speech. "Climate change is probably the greatest challenge of the future, but geopolitical tensions, wars and economic upheaval also require a need for reflection,” he said. Luxembourg is "a crossroads of cultures” with strong traditions of democracy, freedom and human rights, he said while defending multilateralism as it comes under increased threat across the world.