Why Monaco Flourishes as a Top Celebrity Destination Spot

This video is unavailable because we were unable to load a message from our sponsors.

If you are using ad-blocking software, please disable it and reload the page.

Despite being roughly the size of New York City's Central Park, there are big perks to vacationing in Monaco.

The European principality in the French Riviera is the second smallest nation in the world. At 0.75 square miles, tourists can walk the width of Monaco in under an hour, but it has long had a love affair with Hollywood.

PIC: Justin Bieber First to Congratulate Lewis Hamilton on Monaco Grand Prix Win

More than 50 films have taken place in Monaco, including Casino Royale and Iron Man 2, but celebs flock to Monaco for both business and pleasure. Notable tourists have included everyone from Bono to George Clooney. Kate Powers, owner of American restaurant Stars 'N Bars, explains that one reason for that is less pressure from paparazzi.

"You don't see them chasing after people," Powers tells ET. "I think they're used to seeing them around, so they're not going to go running after them."

Another draw is a practical monetary perk.

"There are no taxes!" ET's Kevin Frazier says. "Imagine what you can do with all that extra money."

NEWS: 'Grace of Monaco' Writer's Twitter Tell-All Reveals How Nicole Kidman Ended Up in a Lifetime Bomb

Frazier was in Monaco to act as the master of ceremonies for the christening of the luxury ship, Seven Seas Explorer.

"I am so honored to be here," Frazier said at the event. "At Entertainment Tonight, I cover a lot of red carpets, but never have I covered anything like this."

The Seven Seas Explorer has been dubbed "the world's most luxurious ship," and the christening attracted dignitaries like Prince Albert II with his wife, Princess Charlene, and Andrea Bocelli, who serenaded them on the Port of Monte Carlo.

Princess Charlene is serving as godmother for the ship, which features 14 decks and spacious rooms fitted with marble details and balconies.

WATCH: Kate Hudson's Sexy Bikini Vacation

"It is an honor to be the godmother of this magnificent ship, Seven Seas Explorer," she said at the event. "I am also thrilled by the discussions taking place between my foundation and Norwegian Cruise Line Holdings to implement my Water Safety program on all their ships. Developing awareness of the risks attached to aquatic environments is, for me, a cause of most importance."