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CONSULEGIS
Zug: small world - big business February 26th, 2016
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Zug: small world - big business
Zug: a worldwide leading business location
• fDi's Small European Regions of the Future 2016/17 (2)
• Economic Potential (2), Human Capital and Lifestyle (3), Business friendliness (2)
• fDi's European Regions of the Future 2016/17 (6)
• fDi's Western European Regions of the Future 2016/17 (4)
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fDi's Maganzine's European Cities and Regions ofthe Future 2016/17 ranking
Swiss Average
Source: Credit Suisse Group 2015
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Criteria:
• Tax rates for individuals and corporations
• General level of education
• Availability of highly qualified manpower
• Transport-system based accessibility
Credit Suisse Location Quality Indicator 2015
Source: UBS March 2014
73.0%
60,55370.5%
2,955,800
Criteria:
• State
financial efficiency
Financial flexibility
• Population
labor market
human capital
• Location
commuter belt
accessibility
• Companies
price structure
innovation
• Economic structure
dynamics
diversification
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UBS Competitiveness Indicator Switzerland 2014
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The best overall package
Stability Taxation
InternationalityAccessibility Quality of life
Talents/
Education
Business friendliness
Effective business environment
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Zug: small world - big business
Page 9
• In the heart of Europe and in the economic center of Switzerland
• 120,000 inhabitants from 131 different nations
• 105,000 workplaces (of which 35,400 commuting in)
• 30,745 companies
• Outstanding economic development over the past decades
Zug: small world - big business
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North-south axis
Gotthard
(rail and road)
Part of the Greater
Zurich Area
In the heart of Europe - in the middle ofSwitzerland
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Selection of int'l companies - mainly HQs
Page 12
• Commodity trading
• Wholesale / distribution of brands
• Life science
(Pharma / Biotech / Med Tech)
• High Tech (incl. Metal processing)
• Information and communication
technology (ICT)
• Financial services
(PE/Family Offices/Fintech)
• Sports articles / Sports marketing
Corporate functions:
• Full headquarters
• Procurement / Supply Chain / IP
Highly diversified industries
Commodity trading cluster
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Commodity trading cluster
"We have enjoyed the excellent relationships with the banks and local
businesses who are well versed with the commodity trading segment."
Ruth Sandelowsky, CEO Kolmar Group
Wholesale
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Wholesale cluster
Trading with textiles, clothes, sports articles, pharmaceutical and medical goods,
cosmetics, machinery, electronics, food, ICT etc.
Life science
Estimate 2013:
Total about 6'700 Jobs, whereas
• 3'300 in pharma/biotech, whereas
• 2'700 in headquarters with all functions such as top management, finance,
HR, marketing and sales, supply chain, pipeline of products and certification,
testing etc.
• 600 in the production)
• 3'400 in medtech incl. all functions mentioned above plus R&D and production
This equals about 6 % of all the jobs in the canton of Zug.
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Life science cluster Zug
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J&J Campus (1,000 people)Picture by: Leistungsfotografie.ch - LWA® Swiss professionals team
Roche Diagnostics Worldwide HQ (2,500
people)
High growth of leading life science companiesin the Canton of Zug
Life science: medtech cluster
Worldwide highest density of life sciences andmedtech companies is found in Switzerland
Source: Swiss Medical Technology Industry Survey 2012
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Zug: Life sciences
hotspot in Switzerland
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Medtech companies in the Canton of Zug (selection / mainly European or int'l HQ)
- HQ Roche Professional Diagnostics
- HQ Roche Molecular Diagnostics
Life science: pharma/biotech cluster
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Pharma/biotech companies in the Canton of Zug (selection / mainly European or int'l HQ)
High Tech cluster
- Arised in 1896 with «Institute Theiler & Cie» (Landis+Gyr AG)
- 1913 V-Zug was founded; 1920 invented the first hand-operated washing
machine
- Continuous growth in the last decades
- Employment number rose 37% since 1995 in Precision technology sector
in Zug (High-Tech employment in Switzerland rose 11.9%)
Precision Technology Partners:
- TFZ - Technology Forum Zug (www.technologieforumzug.ch )
- WERZ - Institute for Energy and Resource Efficiency (www.werz.hsr.ch )
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Facts about High Tech in Zug
- Besi Switzerland AG - Medela
- Crypto AG - OVD Kinegram
- Grundfos - Trumpf Maschinen
- Hitachi Medical Europe - V-Zug
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High Tech companies in the Canton of Zug (selection / mainly European or int'l HQ)
ICT cluster
Zug (10.6%)
Source: BFS, UBS
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Highest ICT employment share in the Canton ofZug
As of latest STATENT (2012):
more than 1,200 companies
more than 8,800 jobs, whereas
• 3,700 in core functions
• 3,900 in production
• 1,000 in trade
• 250 other ICT-related
This equals about 10.6% of all the jobs in the Canton of Zug.
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ICT cluster Zug
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IT-companies
Companies with significant IT-functions
Production and trading of IT-products
ICT companies in the Canton of Zug (selection / mainly European and int'l HQ)
Financial services cluster
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Financial services cluster
Zug’s central location, favorable economic environment and business-friendly
approach make it a beneficial location from which to operate, while its excellent
infrastructure, vibrant atmosphere and extensive cultural and recreational
facilities help us to attract and retain talent.” Stewart Beaumont, Chief Technology Officer, Thomson Reuter
Procurement & Supply chain management cluster
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- Amgen - Grundfos
- Besi - Mövenpick
- Glencore - Rittmeyer
Procurement companies in the Canton of Zug (selection / mainly European or int'l HQ)
Textile cluster
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Estimate 2015 Economic Promotion Agency based on latest federal data (2013)
more than 100 companies
more than 650 jobs, whereas
• 300 in the wholesale trading with clothing
• 100 in the wholesale trading with textile
Some Facts & Figures about the Textile Cluster in the Canton of Zug
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Members of the Amer Group:
Members of the Veldhoven Group:
Textile companies in Zug
Zug: leading in political and economic stability
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• For many decades about 75 % conservative voters
• 6 out of 7 ministers are member of a conservative party
• Multiparty political system = long-standing tradition and stability
Politically stable
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Zug #1 internationally and in CH
X-axis: Effective average taxes for highly qualified individuals / corporations
Y-axis: Long-term revenue surplus/shortfall as a percentage of GDP
The X-axis intersects the Y-axis at the average taxe rate of BAK taxation index
(41.9% highly qualified individuals / 27.8% corporations)
DE
FK
IR
AT
BEL
CZ
DK
ESFI
HUIT
LUX
NL
PLSE
SK
UK
AR
OW
NWZG SH
SG
GL
SZ
ZH
BE
BS
TG
NO
GR
UR
LU
SL
GE
-12
-10
-8
-6
-4
-2
0
2
4
6
8
10
12
5 10 15 20 25 30 35
Reve
nu
e s
urp
lus
/ in
com
e g
ap
20
60
BAK Taxation Index Corporations 2013
DE
FK
IR
AT
BEL
CZ
DK
ES
FI
HU
IT
LUX
NL
PL
SE
SK
UK
AROW
NWZG
SH
SGGL
SZ
ZHBE
BS
TG
NO
GR
UR
LU
SL
GE
-12
-10
-8
-6
-4
-2
0
2
4
6
8
10
12
20 25 30 35 40 45 50 55 60R
eve
nu
e s
urp
lus
/ in
com
e g
ap
20
60
BAK Taxation Index Highly Qualified Individuals 2013
Zug #1 internationally and in CH
Source: BAKBASEL, ZEW
Tax rates and public financing sustainability
Swiss cantons
European countries
Zug: high availability of talents
• Access to largest talent pool of approximately 1 mio. in Greater Zurich Area
and Central Switzerland
• Access to over 100 mio. European talents
• Global top specialists
• Worldwide leading universities and research institutes are located in the
area Zurich/Zug/Lucerne (e.g. Swiss Federal Institute of Technology Zurich
ranked 9th best university in the world, World University Ranking 2015)
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Magnet for international talents
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16% - 20%
20% - 24%
24% - 27%
27% - 30%
30% - 33%
33% - 40%
40% - 49%
Source: Bundesamt für Statistik, Geostat, Credit Suisse
Persons holding a
university degree
High percentage of highly qualified talents
Source: microcensus mobility and traffic; BFS 2012
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Total: commute to Zug 35,400 commute out of Zug 17,700
Zurich Airport: Switzerland's gateway to the worldShort commuting distances within Switzerland
By air:
Access due to central location in Europe and Switzerland
Page 46
World-renowned research & knowledge locationZug Institute of Financial Services Zug (HSLU)
From 2016 School of Information Technology (HSLU)
Institute for Energy and Resource Efficiency (WERZ)
Zurich Swiss Federal Institute of Technology Zurich (ETHZ)
(20 min from Zug) University of Zurich (UZH)
Lucerne University of Lucerne
(20 min from Zug) University of Applied Sciences Lucerne (HSLU)
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Source: Global Competitiveness Index 2015-2016, World Economic Forum (6 = Highest score)
Criteria:
Redundancy costs
Hiring & Firing
Cooperation in labor-employer relations
Flexibility in wage determination
Ease of finding skilled employment
Active labor market policies
Pay and productivity
Reliance on professional management
Female participation in labor force
Male participation in labor force
Labor market efficiency
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Changes in immigration law
Unchanged free movement of persons until 2017. At present, negotiations
with the EU as follows:
• Maintaining of the bilateral agreements
• Immigration must be influenceable by Switzerland
• Significant economic needs must be considered (initiator's statement)
Conclusions
• Outcome open since the EU's reaction is pending
• Worst case scenario: quota system like we had before 2002, ZG was always able to
cover their requirements
• Alternative scenario: additional vote considering all the pros and cons
Zug: highest quality of life
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«The Canton of Zug offers our employees a quality of life that is unrivalled: a
fantastic transportation infrastructure, clean environment and a hub for
innovation all set against awe-inspiring landscape. This made our decision to
establish our office in Zug an easy one!»
Dieter Schulze, CEO SABMiller Europe AG
Quality of life
People from 131 different nations live in the canton (total: 31,643).
By continents:
Europe 88 %, Asia 5 %, America 4 %, Africa 2 %, Australia 1 %
Top 12 nations in percent:
Source: Fachstelle Statistik Zug, 2013
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International community
• Info material & news
• Newcomer set
• www.zg.ch (English)
• www.zug4you.ch and The Zug Post
• Migration Advisory Office
• English-speaking authorities
• Relocation agencies
• Service & international clubs
• Various events
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Integration of internationals
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• International School of Zug and
Luzern www.iszl.ch
• Walterswil/Baar
• Riverside Campus, Hünenberg
• Institut Montana, Zug/Zugerberg
www.montana-zug.ch
• International School of Central
Switzerland, Cham
www.isocs.ch
• SIS Swiss International School, Rotkreuz
www.swissinternationalschool.ch
• Four Forest Bilingual International School,
Cham
www.four-forestschool.ch
International Schools
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• Cantonal hospital in Baar (Zuger Kantonsspital)
• Private Andreas Clinic Cham (Hirslanden Group)
• Nursing homes
• Home healthcare support (Spitex)
• Many more hospitals in Zurich and Lucerne
Health Care System
connections per hour and direction
Zug city trains
Access to city center fromall communities within max.15 min
20 min to Zurich (half hour interval)
41-53 min to Zurich Airport (half hour interval)
20 min to Luzern ( half hour interval)
Baar
Cham
Rotkreuz
Arth-Goldau, Erstfeld
Oberwil
Chämleten
Zythus
Neufeld
Lindenpark
Postplatz
Fridbach
Schutzengel
Chollermüli
Alpenblick
Casino
Walchwil
Hörndli
Luzern
Zug
Zürich
Zürich
Steinhausen
Rigiblick
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Source: Swiss Federal Statistical Office, Crime Statistics 2015
Crime statistics 2014
Zug: effective business environment
Our Economic Promotion team
• is a "one-stop-shop" caring for companies located in Zug and supporting those
interested in moving here,
• actively develops solutions for industry needs,
• provides answers to your questions: solution-minded and fast,
• offers a unique set of supporting material,
• acts as a long-term partner to support you in your growth.
All our services are free of charge.
The spirit of Zug: friendly and efficient
• Business support services
270 advocates
300 fiduciaries (90 organized in Fiduciary Association of Zug)
> 10 banks (some providing international services)
• Business premises
High availability of top office space on prime locations at reasonable prices.
Price range depending on location (CHF 150.- to CHF 400.- per m2 and year)
• Business centers
10 business centers in the canton
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Business infrastructure
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software
electronics
applied ICT
environmental techn.
supply chain mgmt.
micro technology
automations
manufacturing techn.
Pharma Medical
Facilities and
energy
engineering
Machine &
apparatus
engineering
ICT
Sector-Clusters
Platform for decision-makers:
Discussions on strategic, innovation-
and technology- oriented topics,
networking
Topic-Clusters
Platform for the topic experts: Discussions,
networking
Technology Forum Zug - Cluster platform
Zug: highly attractive tax environment
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Source: KPMG (2015) Corporate Tax Rates Table & Swiss Tax Report 2014
International tax comparison coporate profit taxMaximum tax levy on corporate profit
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Source: KPMG (2015) Corporate Tax Rates Table
Development international corporate profit taxMaximum tax levy on corporate profit
8.5%
tax status ordinarymixed
(~ up to 5 FTE, no
Swiss income, share-
holders abroad)
mixed(~ more than 30 FTE,
no Swiss income)
8.5% 8.5%
8.9%
0.9%2.2%after tax rates
(published)
effective tax rates
(% on pre-tax profit)
14.57% 8.56% 9.62%
8.5%
7.83%
Holding(holding participations,
2/3 of income / assets
out of participations)
cantonal
& municipal
federal
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Corporate profit taxation
Source: Kantonale Steuerverwaltung Zug
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Corporate entities
Example
Joint-stock company equity of CHF 2 mio.
Net profit CHF 160,000.00
Total cantonal, municipal and church tax (+direct
federal tax approx. CHF 11,790)
Source: Eidgenössische Steuerverwaltung, 2014
Intercantonal tax comparison
52%
51%
48%
45%
45%
45%
44%
40%
34%
23%
0% 10% 20% 30% 40% 50% 60%
Netherlands
Japan
Ireland
China
Great Britain
Germany
Luxembourg
USA
India
Zug
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Source: KPMG's Swiss Tax Report 2014
International tax comparisonMaximum individual tax
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Private individuals
Source: Eidgenössische Steuerverwaltung, 2014
Intercantonal tax comparison
Example
Married person with two children
Gross income
CHF 150,000.00
Total cantonal, municipal and church tax
(+ direct federal tax CHF 1,954)
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Source: BAK Basel Economics, Centre for European Economic Research, 2015
Effective average tax rate (single, EUR 100,000)
Effe
ctiv
e ta
x bu
rden
of c
ompa
nies Zug #1 in CH and #3
Int'l behind SGP/HK
Taxation index on companies and highly qualifiedmanpower
The EU demands to abolish the privileged taxation since activities abroad are
taxed less than domestic activities. Corporate tax reform III
The aim of the reform is to keep the business location as one of the most
attractive as well as to maintain the international acceptance of the new tax
measures.
Aims
• Future stability and planning security, and therefore, settlement of the tax dispute
• International competitive corporate tax reform (ZG 12% - 12.5% ordinary rate)
• Internationally accepted tax measures starting 2019 (e.g. licence box)
• Solid financial situation in Switzerland allows long-term attractive taxation
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Corporate tax reform III
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Department of Economic Affairs
Economic Promotion
Aabachstrasse 5
CH - 6301 Zug
Phone +41 (0)41 728 55 04
Mail [email protected]
Internet www.zg.ch/economy
Contact information