Switzerland country profile
Switzerland's main trading partner is the EU. On the other hand, Switzerland is currently the fourth largest trading partner of the EU. Trade figures in 2008 show EUR 80 billion in imports and EUR 97.6 billion in exports. In terms of imports, Switzerland was the EU's 5th most important trading partner in 2008, after the US, China, Russia and Norway. Regarding exports, Switzerland was the 3rd after the US and Russia in the same period.
Member of Schengen area:Yes
Political system: Swiss Confederation
Capital city: Berne
Total area: 41 290 km²
Population: 7.6 million
Currency: Swiss franc
Economy overview
Switzerland is a peaceful, prosperous, and modern market economy with low unemployment, a highly skilled labor force, and a per capita GDP among the highest in the world. Switzerland's economy benefits from a highly developed service sector, led by financial services, and a manufacturing industry that specializes in high-technology, knowledge-based production. Its economic and political stability, transparent legal system, exceptional infrastructure, efficient capital markets, and low corporate tax rates also make Switzerland one of the world's most competitive economies. The Swiss have brought their economic practices largely into conformity with the EU's, to enhance their international competitiveness, but some trade protectionism remains, particularly for its small agricultural sector. The fate of the Swiss economy is tightly linked to that of its neighbors in the euro zone, which purchases half of all Swiss exports. The global financial crisis of 2008 and resulting economic downturn in 2009 stalled export demand and put Switzerland in a recession. The Swiss National Bank (SNB) during this period effectively implemented a zero-interest rate policy to boost the economy as well as prevent appreciation of the franc, and Switzerland's economy recovered in 2010 with 2.7% growth. The sovereign debt crises currently unfolding in neighboring euro-zone countries pose a significant risk to Switzerland's financial stability and are driving up demand for the Swiss franc by investors seeking a safehaven currency. The independent SNB has upheld its zero-interest rate policy and conducted major market interventions to prevent further appreciation of the Swiss franc, but parliamentarians have urged it to do more to weaken the currency. The franc's strength has made Swiss exports less competitive and weakened the country's growth outlook; GDP growth fell to 2.1% in 2011. Switzerland has also come under increasing pressure from individual neighboring countries, the EU, the US, and international institutions to reform its banking secrecy laws. Consequently, the government agreed to conform to OECD regulations on administrative assistance in tax matters, including tax evasion. The government has renegotiated its double taxation agreements with numerous countries, including the US, to incorporate the OECD standard, and in 2011 it reached deals with Germany and the UK to resolve outstanding issues, particularly the possibility of imposing taxes on bank deposits held by foreigners. These steps will have a lasting impact on Switzerland's long history of bank secrecy.
Trade in goods
Swiss merchandise exports are concentrated on a few sectors,
particularly chemicals and medicinal products, machinery, instruments
and of course watches. Switzerland represents 5.2% of EU's total
imports.
Trade in services
Switzerland is a very important partner of the EU for trade in services, in particular commercial services are considerable. In 2008 the EU's export totalled €67.0 billion, imports from Switzerland €47.2 billion. The balance between Switzerland and the EU was in favour of the latter.
Useful links
Delegation of the EU to Switzerland and Liechtenstein
The Federal Authorities of the Swiss Confederation