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Swiss Economy: stable and competitive with low taxes



Switzerland is a tiny country with a small population located right in the heart of Europe. However, even with this size of the population including immigrants, many Swiss cities have managed to be on the list of must-visit places in the world.

One of the main reasons is that Switzerland has one of the most stable and competitive economies in the world. This is thanks to its political stability and neutrality, well-constructed and transparent legal system, low taxes and of course, the Swiss Franc. This stability attracts investors from all over the world. This makes banking and finance the main sectors supporting the Swiss economy.

According to famous Forbes magazine Switzerland goes in line with countries having lowest unemployment rates and highest per capita GDP rates (5th in the world). Switzerland is also included in the top 10 safest countries in the world with the lowest crime rate.

The economy in Switzerland following the regular First World model is divided into three sectors: agriculture, industry and services. The most developed out of which is the Service sector, as around 72% of Swiss GDP is received by the service sector, then comes the industry with 27% and the last is agriculture (1%).

Switzerland’s insurance, tourism and banking industries guide the service sector. Swiss banks form the significant part of the service sector including the most important Swiss banks Credit Suisse and UBS.

The secondary sector depends mostly on import and export. Unexpectedly, regardless the country having world-known and overly wealthy companies such as Rolex, Nestlé, and Swatch, most businesses in here are small and medium-sized enterprises (called SMEs). The watchmaking also plays a major role in the growth of Swiss economy making Switzerland one of the leaders in exports of high-quality watches and clocks.

Switzerland is not very famous for its agricultural industry, in spite of the fact that the country has many picturesque mountains views and emerald fields. Nonetheless, the Swiss agriculture produces over 60% of food supplies for the people living in the country.

Thanks to its prosperous and beneficial location, Switzerland has many important international trade-partners. The European Union is the main foreign trading partner of Switzerland. In many European countries, Switzerland introduced its economic practices, which enabled to increase the competitiveness.

The Swiss economy is highly connected with its neighbors in the Eurozone, as 60% of both Swiss exports and imports are arranged with the EU countries.

The global crisis of 2008 passed through Switzerland as well in the course of which the SNB (Swiss National Bank) implemented a zero-interest-rate policy to boost economies and as a result of this policy in 2010, the Swiss economy started to recover.

In 2015, during the Global Innovation Index, Switzerland’s economy having the first place in the world. Moreover, it ranked number one in Global Competitiveness Report, which took place in 2017. Another important thing to mention about the Swiss economy is that this country spends about 16 billion CHF on research and development every year. Thus, in other words, we can surely say that Switzerland can be considered a safe paradise for businessmen.

Swiss Economy