Switzerland is a small, landlocked country located in the heart of Europe. The Swiss economy has been ranked as the most competitive economy in the world for several years. Switzerland is known for its high quality of living, low unemployment rate and excellent infrastructure, making it an attractive destination for both businesses and tourists alike.
According to cheeroutdoor, the Swiss economy is based on a highly developed free market system, where prices are determined by supply and demand rather than through government intervention. This has resulted in an efficient and stable economy, which has been able to withstand global economic downturns better than other countries. The main sectors of the Swiss economy are banking & finance, manufacturing, tourism and agriculture.
The banking sector is one of Switzerland’s largest industries with more than 300 banks operating in the country. Switzerland’s banking system is renowned for its secrecy laws which protect customers’ financial data from being disclosed to third parties or foreign governments. This has made Switzerland a popular destination for wealthy individuals who want to keep their finances private.
Manufacturing also plays an important role in the Swiss economy with pharmaceuticals and chemicals being some of its biggest exports. Switzerland also produces precision machinery and watches, which have become iconic symbols of quality around the world. Tourism is another major contributor to the Swiss economy with millions of visitors coming each year to enjoy its stunning natural beauty and cultural attractions such as skiing, hiking and lakeside resorts.
Agriculture plays an important role in providing food security for the Swiss population as well as contributing significantly to export earnings through dairy products such as cheese or chocolate-based items like Toblerone candy bars. There are also many small businesses that produce handmade goods such as clocks or jewelry that are sold both domestically and abroad.
The government plays an important role in promoting economic growth by providing incentives for businesses to invest in research & development activities or environmental protection measures going forward into generations beyond our own today. The government also sets fiscal policies that promote stability by keeping inflation low while encouraging investment into new technologies that can improve productivity or reduce energy usage. In addition to this, it provides generous welfare benefits for citizens who require assistance due to unemployment or other forms of financial hardship. All these measures help ensure that Switzerland remains one of the wealthiest countries in Europe with a strong export-oriented economy that continues to thrive despite global economic uncertainty.
Abbreviated as SUI by abbreviationfinder.org, Switzerland is a highly industrialized country at the same time as it has a very significant service sector in the international context. The service sector is dominated by finance and insurance activities with a very well-developed banking system in terms of both organization and distribution. The country’s political stability, the strong Swiss franc and “Bankheimheimnis” (Swiss banks are only in exceptional cases – on suspicion of criminal activities such as terrorism, organized crime and tax fraud – obliged to provide information about their customers), have provided the banks with a lot of foreign capital. The two major banks UBS (United Bank of Switzerland) and CS (Credit Suisse)) is one of the leading financial corporations in the world. In the service sector, tourism has also traditionally been important in Switzerland, and in recent years it has been of increasing importance.
The country’s limited area, the lack of commodities and the geographical location in central Europe have contributed to the fact that Switzerland is highly dependent on foreign trade. The country’s economy has expanded significantly during most of the post-war period, and with the exception of the years only in the 1990s and 2009, it has also shown real growth over the last couple of decades despite the fluctuations in the international economy. Thus, during the period 1990–2011, Switzerland’s national product increased by an average of 1.3 percent annually, compared to 0.8 per cent annually in the population during the same period. In 2011, GDP per capita was USD 79,035, which was one of the highest in the world.
In 2011, agriculture contributed just over one percent of GDP and this year employed four percent of the working population, industry (including mining and construction) with 26 percent of GDP and 22 percent of employment respectively, while service industries contributed 71 per cent of GDP and 74 percent of the working population. Unemployment in Switzerland was 3.1 percent in 2011 (annual average). The country has a significant element of foreign labor; more than 22 percent of the country’s working population were foreign nationals at the end of 2011.
Agriculture and forestry
Agriculture, as a result of the country’s topography and elevation above sea level, is essentially a livestock farm. The agricultural area makes up a total of 37 percent of the land area, but only 24 percent of the total area is cultivated land in the true sense, the rest are mountain pastures, essentially in the Alpine areas. The uses are consistently small and medium-sized; average area per user in 2011 was 183 ha (hectares) of agricultural land and 1/6 of the farms had a cultivated area of less than 50 ha.
Of the farmers’ income, slightly more than half falls on livestock and somewhat falls on plant production. Of the agricultural area, the arable land is 28 percent, 13 per cent is cultural pasture and the rest is nature meadow. Slightly more than half of the arable land is used for grain cultivation, and half of this is left for wheat. The limit for wheat cultivation goes at approx. 1200 m asl, barley, oats and rye a few hundred meters higher. Otherwise, in particular feed crops, potatoes, oilseeds, sugar beets, fruits, vegetables and grapes are grown. Fruit, vegetable and wine cultivation is run in the low lying valleys, especially in Valais and Ticino. Otherwise, wine is produced at Lake Geneva and along the foot of the Jura Mountains. The majority of field crop production is concentrated in Mittelland.
Agricultural yields have increased significantly, but production does not cover more than half of the domestic demand. The country is self-sufficient with dairy products, meat and wheat. Agriculture benefits from subsidies, price guarantees and import controls, and farmers are guaranteed an income equivalent to industrial workers’ wages. The most important agricultural policy problems are related to small average size of farms, sometimes very strong cropping of land and the relocation of farms in the most remote areas. Agriculture is often run in combination with rental for tourist purposes, industrial work and partly forestry.
The forest area accounts for just under 1 / 3 of the country’s total area. Relatively most of the forest has the cantons in the Jura mountains and the forests. Of the productive forest owned anything over 1 / 4 of the private, 7/10 are publicly owned, mostly by local administrations; The state owns only a modest share of the forest.
Switzerland is generally poor in ores, metals and fossil fuels. Except for quarrying and the production of sand and gravel, only salt and soda extraction is important.
Switzerland’s only significant source of energy is hydropower. Of the country’s total electricity production in 2011 of 62.9 TWh, hydropower accounted for 54 percent, nuclear power for 41 percent and conventional heat for 5 percent. Switzerland has adopted ambitious plans for a more sustainable energy production. In this context, further development of hydropower plays a significant role. Hydropower generation is planned to increase by between 1.5 and 3.2 TWh annually until 2050. This is expected to occur through the upgrading of older power plants and the construction of new, larger plants, and not least in the construction of small power plants. At the same time, a significant upgrade is being undertaken transmission network.
From the late 1960s, there was a significant expansion of nuclear power plants and larger thermal power plants in Switzerland. However, following a decision in the Bundesrat 2011, it has been decided not to build more nuclear power plants until 2050. It has also been decided that those in operation will not be continued when their estimated life is over. Neither will heat plants be built during this period. It is the focus on hydropower and other renewable energy sources that has enabled such a gradual phase-out of nuclear power and conventional thermal power.
Switzerland has to import around 4/5 of the energy needs, primarily in the form of petroleum products. However, in normal year the country is a net exporter of electricity.
Due to the lack of domestic raw materials, the industry is very much geared towards highly processed products. The companies are consistently small and medium-sized. Several companies are among the foremost in the world in their fields, and Swiss industry has established itself in a number of countries, partly through subsidiaries and other forms of ownership interests, partly through the sale of know-how, licenses and the like. In the Swiss industry, three industries stand out: the engineering industry, the food and beverage industry and the chemical industry (including the pharmaceutical industry) and with 49, 13 and 11 percent respectively of the industry’s total employment (2016).
The engineering industry consists of, among other things, the production of computer and electrical/electronic products, optical and medical-technical products and the watch industry, as well as a significant production of machinery, including office machinery, machine tools, generators and other power plant equipment, diesel engines, textile machinery, etc. as well as metal products. Switzerland also has a not insignificant production of transport equipment, including railway materials and tractors.
Switzerland has lost some of its dominant role in international watch production in recent decades, especially due to competition from Japan and other countries in Southeast Asia on affordable electronic watches. However, the country still holds the position as one of the world’s leading watch exporters, primarily of quality watches. The watch industry is located in the Jura Mountains, with the main emphasis in La Chaux-de-Fonds, Biel, Grenchen and Le Locle, as well as Geneva. This location must be seen against the background of the considerable immigration of French Huguenots in the 17th and 18th centuries, a group of many skilled craftsmen who laid the foundation for the later world-renowned Swiss watch industry.
The chemical industry also plays a major role internationally; This is especially true of the pharmaceutical industry, which in 2017 had a total turnover of around NOK 669 billion. This is particularly located in Basel. Several of the world’s most important pharmaceutical groups are based in Switzerland (Novartis, Roche Holding, Sandoz and others). Other chemical industries include the production of dyes, agricultural chemicals, and so on. Incidentally, the development of oil and gas pipelines has given rise to a growing domestic refining of petroleum since the mid-1960s.
In the food industry, especially the internationally known production of chocolate, cheese and infant foods (including Nestlé SA) is noted. The food industry in general is largely aimed at the domestic market. Switzerland otherwise has some wine production.
The textile and clothing industry in Switzerland has long historical traditions, primarily in the eastern part of the country, especially in St. Gallen. The different districts have their specialties based on local craft traditions. As Switzerland is a high-cost country, the textile and clothing industry has been declining for decades, but in 2017 it still had sales of around NOK 27 billion.
Switzerland, with its magnificent scenery, is one of Europe’s foremost tourist countries. Tourist traffic started early in the country, as early as the 19th century the first tourists came to the areas of Lake Geneva, later to the alpine pedal farther east, and towards the end of the century the industry was one of the most important sources of income in Switzerland. Today, it contributes to 8–9 percent of Switzerland’s trade balance, and the industry employs, directly and indirectly, about 10 percent of the country’s total employment. Tourism in Switzerland has to a considerable extent formed a model for the development of tourism in many other countries.
The most important tourist areas can be found in the High Alps, in the forest cantonments in the central regions of the country, and at Lake Geneva. In many places, the tourism industry is a major industry. The hotel standard is high; railways, mountain railways and ski tows have been developed to a greater extent than perhaps anywhere else in Europe. Tourist traffic is very large despite the country having a relatively high price level; in 2008, the figure for foreign tourists was estimated at about 21.5 million. It is estimated that tourist traffic contributes 7.3 percent of the gross domestic product in Switzerland (2016).
Switzerland has a large foreign trade compared to the population, which is due to the fact that the country lacks most raw materials and fossil fuels and in addition is not self-sufficient with food. Exports mainly consist of highly processed industrial products.
- COUNTRYAAH: Find major trading partners of Switzerland, including major exports and major imports with latest trade value and market share as well as growth rate.
Switzerland has traditionally had a significant import surplus; in the 1960s, commodity imports averaged about 20 percent above commodity exports. From the mid-1970s, this surplus was greatly reduced, and from the 1990s Switzerland has largely had an export surplus. In 2010, export of goods was 11 percent above the import of goods.
Switzerland also has significant capital revenues and some service activities, such as interest on foreign loans, licensing revenues, tourist traffic, transit trade, exports of electric power, and so forth, which usually yield large current account surpluses. This has led to a very strong position for the Swiss franc and has regularly led to an increased value of this.
Almost 3/4 of goods exportation by value consisted in 2010 of chemical products, instruments, watches, machinery and electrical products. This year, the pharmaceutical industry alone accounted for around 30 percent of the country’s exports. Imports are also dominated by the same three product groups, but not to the same extent as exports; In comparison, the three aforementioned commodity groups accounted for 43 percent of goods imports in 2010. Other important commodity groups in the import are transport vehicles, metals, petroleum products and agricultural commodities.
Germany is clearly the most important trading partner in terms of both exports and imports. In 2010, nearly 1 / 3 of Switzerland’s imports from Germany while barely 1/5 of the country’s exports went to Germany. Other important trading partners are Italy, France, the United States and the United Kingdom.
Transport and Communications
Switzerland has a very well-developed communication network. Due to the country’s central location in Europe, the road and rail networks have to take a great deal of international transit traffic, which places high demands on capacity. It is an important feature of Switzerland’s transport policy to maintain this traffic, but on the country’s own premises regarding the environment. The goal is to get the most of the transport over by train. This is done within the framework of the so-called NEAT project (Neue Alpen transversal; new thoroughfares through the Alps) which aims to increase transport capacity while protecting the environment. The NEAT project, which is the largest transport initiative in Switzerland, has opened up an extensive train transport of heavy vehicles, which provides both faster traffic congestion and safer transport, while providing a much lower consumption of non-renewable energy. The most important elements of the project are the new so-called base tunnels through Lötschberg and St. Gotthard; these are new tunnels that are much longer than the old ones and therefore do not have to go up to the heights above the sea as the old, shorter tunnels required. The new Lötschberg Tunnel opened in 2007 (with one of the two races), and the new St. Gotthard Tunnel was completed at the end of 2017.
Note: the capital city of Switzerland is Bern with a population of 123,000 (estimate 2012). Other major cities include Zurich with a population of 381,000, Geneva with a population of 191,000, Basel with a population of 167,000, Lausanne with a population of 130,000 (estimate 2012).
Switzerland soon became a transit country for traffic between Italy and Central Europe. In the 19th century, the development of the alpine crossings into drivable roads began in earnest, and with constant improvements they have reached an impressive standard of topography. There are three full-year connections through the Alps, Great St. Bernhard, St. Gotthard and San Bernardino, all with significant tunnels during the mountain crossings. In the lowlands, the road network is very dense. A major problem in the road sector is the capacity of the thoroughfares. A special feature of road transport in Switzerland is the many train transports of cars, not just over the mountain crossings in winter. For mountain passes, see the Alps and the individual passports.
The railways were initially privately run. In the early 1900s, most of the larger companies were merged into a state-owned company, the Schweizerische Bundesbahnen. The largest “private” companies are run by individual cantons in close cooperation with the state railways. Especially for the railway operation in Switzerland is that it is fully electrified, including the narrow gauge network. Well 1 / 4of the line network is the narrow track, essentially the private section. On this network you will find at a number of alpine crossings a combination of normal propulsion and gearing. By the way, there are a number of local companies that operate clean mountain railways, the best known of which is perhaps the cogwheel of Jungfraujoch, the highest railway in Europe (the top station 3455 m asl). In recent years, the rail network has largely been expanded to double tracks, to withstand higher speeds (200 km/h) and to make journeys more comfortable.
Basel is a significant river port. Main airports are Zurich (Kloten), Geneva (Cointrin) and Basel (St. Louis which is on the French side of the border), all with international traffic.