	ALL ABOUT SWITZERLAND					ECONOMY BUSINESS
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All About Switzerland

Economy and Business

Industry, Trade and Services

Switzerland has a mature market economy based on

export oriented machine and electrical manufactures (high precision motors, generators, turbines, textile and tool machines, mills, watches and many innovative high-tech products) including automation equipment and engineering of whole power or industrial plants. The focus is on niche products with a high proportion of complex engineering but rather small series.
chemicals (colors, fertilizers, pestizides) and pharmaceuticals
financial services: international trade, insurance and banking
tourism
export of electrical energy, primarily peak power (winter days) produced by Switzerland's many hydroelectrical plants

Switzerland's central location in Europe, the stability of its politics and currency, social peace (leading to a high productivity), moderate taxes, excellent public infrastructures and a high level in education have made Switzerland one of the world's most important financial centers and an excellent place for European or even worldwide headquarters of internationally operating companies.

Important Trading Partners

Switzerland's most important trading partners are its big neighbours Germany, France and Italy, followed by the United States, the United Kingdom, and Japan. Some 80% of Switzerland's trade is with members of the European Union.

The standards of living, workforce productivity, education, and health care are very high in Switzerland, higher than in most other European countries. Inflation is low (about 1% per year for several years), and unemployment fairly low (about 4%).

Agriculture and Raw Materials

Agriculture today employs less than 4% of the population, and every day one or two farms are closed down. Since only 10% of the land is arable, the primary agricultural products are cattle and dairy goods. Major products grown for the internal market include potatoes, wheat, corn, all sorts of vegetables, salads and sugar-beets. Traditional fruits are apples, pears, cherries, strawberries, plus tomatoes and apricots in the southern valleys of Switzerland. Vine can be grown even in nothern Switzerland, but Swiss vines are rather to be found among the interesting specialities than among the really great names.

Mineral resources are scarce, and almost all mines that once existed have been closed due to very poor output before World War II. Water and wood are abundant, however, and drinking water supply is excellent both in quantity (no scarcity) and quality (drinkable without being boiled and without addition of chloride).

Electricity is generated from hydroelectrical and nuclear power (40%). While there is usually a net export of electricity both in quantity and value (2005 was the first year since World War II with net imports), Switzerland is a major trading spot in the European electricity market, importing band energy from nuclear and fossile thermoelectrical plants in times of low consumption (summer, nights) and exporting valuable peak energy from hydroelectrical plants in winter. A part of the imported electricity is used during nights to pump water back into reservoir lakes so that it may once again be used to produce peak power. There are some efforts to promote solar, geothermical and wind energy, but their share is not yet significant.

Trade and Financial Balances

Switzerland's trade balance used to be notoriously negative due to the scarcity of raw materials and the inability to produce enough food in this densely populated area with a high proportion of infertile ground for decades. In the last few years the global trends towards lower prices for raw materials and mass products and stable or even increasing prices for designer products and capital goods have lead to a positive trade balance. Anyway, services like tourism, banking, insurance and railway freight transport have more than compensated for any trade deficits. As a result, Switzerland's overall financial balance is positive in most years.

Links and further information on Switzerland's economy:

www.locationswitzerland.ch Switzerland as a Location for Business

Swiss stock market performance indices

Swissair grounding 2001

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