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flag Switzerland Switzerland: Economic and Political Outline

Economic Indicators | Foreign Trade in Figures | Sources of General Economic Information | Political Outline

Economic Indicators

Switzerland has a highly successful market-based economy. Its standard of living, its industrial productivity, the quality of its education system, and its health-care system are amongst the highest in Europe.
After several years of growth rate above the European average, the Swiss economy contracted sharply in 2009 (-1.9%) due to the international financial crisis. With a growth estimated at 2.7% of the GDP in 2010, the recovery was quick and vigorous, driven by the global recovery, as well as by the quick improvement of domestic demand. But the results were overshadowed in 2011, due to the appreciation of the Swiss franc against the euro (currency of its major trading partners) that has hit Swiss exports and the downturn in U.S. demand.

In 2011, the government pursued its stabilization measures, which concern, among others, supporting employment and promoting exports. In order to comply with the rule of limiting debt, the authorities adopted fiscal consolidation measures on the federal level. Special attention have been paid to inflationary pressures. However,  the economic outlook for Switzerland has deteriorated in recent months: the crisis of the euro has hit the market and affected the economic dynamics of European countries,  the main partners of the Swiss confederation. As a result, growth prospects in Switzerland for 2012 were reduced from 2% to 0.9%.

Switzerland’s unemployment rate, estimated at 3.4% in 2011, remains very low compared to the EU average. However, the decline in economic conditions should result in higher unemployment in 2012, which has not happened since 2009.

 
Main Indicators 2009201020112012 (e)2013 (e)
GDP (billions USD) 492.26527.92e665.90e726.52735.87
GDP (Constant Prices, Annual % Change) -1.92.72.11.41.8
GDP per Capita (USD) 63,58067,77984,983e92,16792,796
General Government Balance (in % of GDP) 0.80.30.60.50.5
General Government Gross Debt (in % of GDP) 54.854.552.451.250.0
Inflation Rate (%) -0.50.70.70.91.0
Unemployment Rate (% of the Labor Force) 3.63.63.43.43.1
Current Account (billions USD) 56.2383.54e83.10e79.3978.63
Current Account (in % of GDP) 11.415.8e12.510.7-

Source: IMF - World Economic Outlook Database ; World Bank , Last Available Data

Note: (e) Estimated Data

Main Sectors of Industry

Agriculture contributes around 1% to the GDP and employs 3% of the active population (only 10% of the land is suitable for cultivation). The primary agricultural products are livestock and dairy products. Swiss authorities grant numerous direct subsidies to farmers in order to meet strict ecological criteria such as soil protection. Organic farming is booming. There are hardly any mineral resources on Swiss soil.

Electricity is generated chiefly from hydraulic and nuclear power. Switzerland is renowned worldwide for the high quality of its manufactured products, which include watches, motors, generators, turbines, and diverse high-technology products. Located in Basel, the chemical and pharmaceutical industry exports all over the world.

The service sector contributes to over 70% of the GDP and employs slightly under three quarters of the active workforce. Well developed and globally competitive sectors such as banking, insurance, freight and transport, contribute substantially to the development of international trade across Switzerland. Tourism, which adds significantly to the economy, helps to balance Switzerland's trade deficit.

 
Breakdown of Economic Activity By Sector Agriculture Industry Services
Employment By Sector (in % of Total Employment) 3.1 20.8 70.4
Value Added (in % of GDP) 1.2 26.8 72.0
Value Added (Annual % Change) 1.4 -4.3 -1.0

Source: World Bank - Last Available Data.

 
 
Monetary Indicators 20062007200820092010
Swiss Franc (CHF) - Average Annual Exchange Rate For 1 USD 1.251.201.081.091.04

Source: World Bank - Last Available Data.

 
 
Learn more about Market Analysis about Switzerland on Globaltrade.net, the Directory for International Trade Services.
 

Indicator of Economic Freedom

Score:
81.9/100
Position:
Free
World Rank:
5/179
Regional Rank:
1/42

Distribution of Economic freedom in the world
Source: 2011 Index of Economic freedom, Heritage Foundation

 

Country Risk

See the Country Risk Analysis Provided By Ducroire.

 

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Foreign Trade in Figures

Swiss economy is very much open to foreign trade, which represents more than 90% of the country’s GDP. The European Union (EU) is Switzerland's major trade partner, accounting for two-thirds of its total foreign trade. On 1st of June 2002, agreements were signed between the EU and Switzerland regarding seven main trade sectors. Exports account for approximately half of the country’s GDP. Switzerland's two main clients of are the United States and the European Union. Switzerland shows a substantial trade surplus.

As a result of the crisis of the euro that began at the end of 2011 and the fall in U.S. demand, we can expect  a near stagnation of Swiss exports in 2012, which should increase by only 1% by volume.

 
Foreign Trade Indicators 20062007200820092010
Imports of Goods (million USD) 141,400161,180183,574155,378176,191
Exports of Goods (million USD) 147,856172,078200,759172,474195,386
Imports of Services (million USD) 26,59231,57436,40038,86738,399
Exports of Services (million USD) 53,46064,25576,18072,30976,300
Imports of Goods and Services (Annual % Change) 6.56.10.3-5.4-
Exports of Goods and Services (Annual % Change) 9.9----
Imports of Goods and Services (in % of GDP) 44.246.045.140.7-
Exports of Goods and Services (in % of GDP) 52.556.256.551.7-
Trade Balance (million USD) 5,00813,23413,4821,39115,870
Trade Balance (Including Service) (million USD) 33,06347,35254,82936,36257,360
Foreign Trade (in % of GDP) 96.7102.2101.692.4-

Source: WTO - World Trade Organization ; World Bank , Last Available Data

 

Main Partner Countries

Main Customers
(% of Exports)
2010
Germany 19.2%
United States 10.1%
Italy 7.9%
France 7.7%
United Kingdom 5.9%
See More Countries 49.2%
Main Suppliers
(% of Imports)
2010
Germany 31.9%
Italy 10.2%
France 8.5%
United States 5.4%
Netherlands 4.5%
See More Countries 39.4%

Source: Comtrade, Last Available Data

 

Main Products

Main Exports
(% of Exports)
2010
Medicaments consisting of mixed or unmixed...Medicaments consisting of mixed or unmixed products for therapeutic or prophylactic uses, put up in measured doses "incl. those in the form of transdermal administration" or in forms or packings for retail sale (excl. goods of heading 3002, 3005 or 3006) 14.1%
Human blood; animal blood prepared for therapeutic...Human blood; animal blood prepared for therapeutic, prophylactic or diagnostic uses; antisera and other blood fractions and modified immunological products, whether or not obtained by means of biotechnological processes; vaccines, toxins, cultures of micro-organisms (excl. yeasts) and similar products 8.5%
Wrist-watches, pocket-watches and other watches,...Wrist-watches, pocket-watches and other watches, incl. stop-watches (excl. of precious metal or of metal clad with precious metal) 4.8%
Orthopaedic appliances, incl. crutches, surgical...Orthopaedic appliances, incl. crutches, surgical belts and trusses; splints and other fracture appliances; artificial parts of the body; hearing aids and other appliances which are worn or carried, or implanted in the body, to compensate for a defect or disability 3.0%
Wrist-watches, pocket-watches and other watches,...Wrist-watches, pocket-watches and other watches, incl. stop-watches, with case of precious metal or of metal clad with precious metal (excl. with backs made of steel) 2.6%
See More Products 67.0%
Main Imports
(% of Imports)
2010
Medicaments consisting of mixed or unmixed...Medicaments consisting of mixed or unmixed products for therapeutic or prophylactic uses, put up in measured doses "incl. those in the form of transdermal administration" or in forms or packings for retail sale (excl. goods of heading 3002, 3005 or 3006) 7.1%
Motor cars and other motor vehicles principally...Motor cars and other motor vehicles principally designed for the transport of persons, incl. station wagons and racing cars (excl. motor vehicles of heading 8702) 5.1%
Articles of jewellery and parts thereof, of...Articles of jewellery and parts thereof, of precious metal or of metal clad with precious metal (excl. articles > 100 years old) 3.8%
Petroleum oils and oils obtained from bituminous...Petroleum oils and oils obtained from bituminous minerals (excl. crude); preparations containing >= 70% by weight of petroleum oils or of oils obtained from bituminous minerals, these oils being the basic constituents of the preparations, n.e.s.; waste oils containing mainly petroleum or bituminous minerals 2.9%
Heterocyclic compounds with nitrogen hetero-atom[s...Heterocyclic compounds with nitrogen hetero-atom[s] only 2.7%
See More Products 78.4%

Source: Comtrade, Last Available Data

 
See More Products
More imports (Intracen Data)
More exports (Intracen Data)
 

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Sources of General Economic Information

Ministries
Federal Department of Economic Affairs
Federal Department of Finance
Federal Department of Environment, Transport, Energy and Communications
Federal Department of Home Affairs
Federal Department of Defense, Protection of the Population and Sport
Federal Department of Justice and Police
Statistical Office
Federal Office for Statistics
Central Bank
Swiss National Bank (SNB)
Stock Exchange
Switzerland Stock Exchange
Search Engines
Search
Goldlinks
Lycos.ch
Reference
Regad
Sharelook.ch
Swissone
Yoodle
Economic Portals
EconomyWatch
SwissWorld

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Political Outline

Executive Power
President is both the chief of the state and head of the government. The post is purely ceremonial and by tradition rotates annually among the seven members of the Federal Council for one-year term.The Federal Council is a seven-member executive council (cabinet) that heads the executive branch, with its members being elected by country’s parliament for a four-year term. Under the constitution of Switzerland the make-up of the government is not determined by parliamentary majority but in accordance with a four-party power-sharing agreement (established in 1959) and known as the "magic formula".
Legislative Power
The legislature in Switzerland is bicameral. The parliament called Federal Assembly consists of: Council of States (the upper house) having 46 seats, with 2 members selected from each of the 20 cantons (states/provinces) and 1 from each of the six half-canton to serve four-year terms and the National Council (the lower house) having 200 seats, with its members elected by popular vote on the basis of proportional representation to serve four-year terms. The executive branch of government is directly or indirectly dependent on the support of the parliament, often expressed through a vote of confidence. The federal legislative power is vested in both the government and the parliament.
Main Political Parties
Switzerland has a multi-party system, where a single party has little chance of gaining power alone. Thus, parties work with each other to form coalition governments. The major parties in the country are:

SVP (Swiss People's Party) – populist right-wing, with a strong base in German-speaking areas of Switzerland, SP (Social Democratic Party) – centre-left, CVP (Christian Democratic Party) - centre-right, Green Party - left-wing environmentalist, its motto "think globally, act locally."

Current Political Leaders
President: Eveline WIDMER-SCHLUMPF(since 14 December 2011)
Vice President: Ueli MAURER (since 14 December 2011)
Next Election Dates
Presidential:December 2012 (conducted on yearly basis)
Council of States: Not available (each canton decides its own election dates)
National Council:October 2015
 

Indicator of Freedom of the Press

World Rank:
6/178
Evolution:
2 places up compared to 2009

Source: Worldwide Press Freedom Index 2010, Reporters Without Borders

 

Indicator of Political Freedom

Ranking:
Free
Political Freedom:
1/7
Civil Liberties:
1/7

Map of freedom 2010
Source: Freedom House

 

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Last Updates: January 2012