HOW STABLE IS THE

SWISS ECONOMY?

ETIENNE KISS -BORLASE  

- A 2017  REPORT -

Switzerland is located right in the

heart of Europe and as such, the

European Union is very crucial to the

country’s foreign trade. This means

that its highly dependent on the

economic climate of the neighboring

countries. More than 50% of

Switzerland ’s exports are purchased

by countries within the Eurozone ,

with Germany claiming the largest

(20%) exports share. The country also

boasts of a very low unemployment

rate , which was put at 4.6% towards

the end of 2016. It is no wonder

many of the citizens enjoy an above

average lifestyle.

INTRODUCTION

THE AGRICULTURAL & SERVICE

SECTOR IN SWITZERLAND

The country is not particularly known for its agriculture probably

because it is home to many meadows and scenic mountains.

Nevertheless , the sector generates up to 100 billion CHF every year,

which contributes about 1% to the GDP. It also helps preserve the

country’s iconic landscape while contributing 60% of the local food

supply. Unfortunately, the quantities of employees as well as farms keep

declining, and the sector has largely become dependent on government

subsidies.

This sector is led by the tourism , insurance and banking industries. With

the banks employing up to 5.8% of the workforce and contributing 6%

to the GDP, they certainly make up a considerable part of the service

sector. UBS and Credit Suisse are the most prominent banks in the

country, with the former owning assets worth $1.738 billion in 2015. With

more than 4000 apprenticeships available in 2016, the banking industry

has built a name for itself as one that invests in the Swiss youth.

THE MANUFACTURING SECTOR

IN SWITZERLAND

Switzerland is home to globally recognized corporations including

Swatch, Rolex and Nestle. Despite that , many of the businesses are small

medium-sized enterprises with a workforce of less than 250. These

businesses employ up to 70% of the population that ’s not employed by

the government. And while a large percentage of the workforce is

employed in the mechanical and engineering, the largest

manufacturing industries in the country, the sector has suffered plenty

as a result of the removal of the currency cap on the Swiss franc. This

move has also made it more difficult for corporations to export to the

Eurozone. Other major sectors include energy, pharmaceutical and

chemical industries as well as watch-making.

The move by the Swiss National Bank to remove its cap of 1.20 CHF on

the exchange rate with the euro on 15th January, 2015 didn ’t just hurt

the manufacturing sector. The tourism industry suffered a major blow as

it deterred travelers in the Eurozone from visiting Switzerland. On the

upside , the Swiss franc became stronger and the country was able to

avoid recession.

THE END

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