The Swiss economy is one of the most stable in the world. The country is an example of how perseverance, work and a competent approach to building a model of economic relations turned a small state into a center of capital turnover. In addition to the presence of a developed banking system, Switzerland holds a leading position in production and tourism, which positively affect its status in the world community.
From backwardness to success
For a long time, the Swiss economy lagged far behind other European states. The protracted agrarian-patriarchal period pulled the state down, blocking the path of development. The first steps to success were taken in the XVI – XVII centuries in the mountainous areas, where trade and industry began to develop rapidly. There were factories for the production of cotton and silk fabrics, watches. In the XIX century, tourism developed, a new sport was founded - mountaineering, which has gained worldwide recognition.
Despite the poor conditions for agriculture and agriculture, Switzerland has focused on dairy production. New industries were being mastered, the country was increasing export volumes. At the same time, a railway line is developing. At the beginning of the 20th century, the National Bank was founded. Switzerland is becoming the largest exporter of capital.
Stagnation period
On the eve of the Second World War and throughout it, Switzerland is also going through difficult times: the country's economy has “stood up”. Decreased production volumes. But already after 1945 the situation began to improve. Exports almost doubled. The economic upsurge was primarily responsible for the high demand for industrial equipment in the post-war countries and the lack of competition. On the whole, its formation in the second half of the 20th century was uneven: the heyday was replaced by a crisis, and vice versa. The political convictions of the government of the country played an important role in the development of the economy: while maintaining neutrality during the world wars and conflicts, Switzerland turned into an advanced state.
The main factor pulling Switzerland down in the post-war period was the high difference in the participation of agriculture and trade in the country's economy. After the market conditions more or less leveled, the state gained stability and success.
Features of the development of the economy
As early as XVI – XVII, the right decision was made on the direction of the country's activity. Switzerland has a territory, most of which is unsuitable for agriculture; There are no minerals except rich nature. A reasonable manager will understand that it is necessary to create something of his own or to rapidly develop what has already been invented. This happened in Switzerland. All countries became aware of the high quality of their products, the share of exports began to grow, and the economy flourished. Having received enough capital from one industry, the country developed another. So the main directions of light industry and pharmaceuticals were mastered. Not only new factories opened here, but many world concerns were created that exist to this day.
The main features of the economy in Switzerland are built primarily on the skillful ability to maximize their advantages. Despite the small areas for agriculture and cattle breeding, dairy farming was developed, the most beautiful nature was used for the development of tourism and hotel business, turbulent rivers and mountainous terrain served as the basis for the development of hydropower. The ability to take everything from practically nothing is the main essence of the Swiss economy, which has transformed the European state from backward to advanced.
The current state of the state
Switzerland today is the heart of finance and banking throughout Europe. The country's economy is a market economy based on international trade and the turnover of foreign capital. The state has a developed light, pharmaceutical and food industries, engineering. The whole world is aware of the high quality of goods exported from Switzerland - from gastronomy to watches and production equipment.
The features of the market economy in Switzerland, despite a number of its differences from other European countries, are easy to notice: the state practically does not interfere in the activities of enterprises, the market is customer-oriented, there are several forms of ownership. The dynamic development of the country only confirms that the correct strategy for building economic relations has been developed. Moreover, the situation is equally successful both domestically and in external relations.
What is the Swiss economy based on today? First of all, these are banks, of which there are a lot. Given the branches, for every 1, 500 people there is one institution. In addition to quantity, high quality service. The data of depositors is carefully classified, and it is almost impossible to identify them to outsiders. The inflow of foreign capital strengthens the country's economic situation and brings great benefits.
Sectoral structure of the Swiss economy
This is one of the most developed countries with a high standard of living and virtually no unemployment. Thanks to the policy of neutrality, the country survived world wars with almost no loss. Today, Switzerland is thriving due to the developed sectors of the economy founded in the last century. They include:
- production of equipment, watches;
- light industry and pharmaceutical companies;
- Agriculture;
- banks activities;
- tourism.
Compared to other developed countries, the number of transnational organizations in Switzerland is large. Their activities significantly affect the economic situation of the country. The state is famous for its well-established credit and financial system, low inflation and unemployment.
Industrial sector
The basis of the Swiss economy is industry, it was thanks to its development back in the 19th century that the state began to flourish. Since the 18th century, the country has become known as a watch manufacturer. Having achieved success in this industry and having established import, she began to develop the light and food industries. Textiles were in great demand among partners, but after World War II, emphasis was placed on metallurgy and the pharmaceutical industry.
Today, the industrial sector consists of many manufacturing enterprises and global concerns. Most of the finished products are exported. Switzerland has established itself as a manufacturer of quality and durable products. The main industries of the country are:
- Mechanical engineering - production equipment for printing, weaving machines, electrical engineering is produced. About 40% of the products in this industry are exported.
- Watchmaking is the highlight of Switzerland, almost all finished products are sent abroad for sale. They are known throughout the world and are synonymous with wealth and quality.
- Pharmaceutical industry - in a pharmacy in almost every country you can find a drug from Switzerland.
- Food Production - Few have heard about Swiss cheese or chocolate. The famous Nestle concern was founded here.
Features of the Swiss economy boil down to a wide spread of industrial and agricultural volumes. The average state structure is built mainly on the second sector. Here you can observe the opposite picture.
Foreign economic relations
Foreign trade is an established mechanism of the country, bringing it great profits and world recognition. The Swiss economy is built, in particular, on significant export volumes of industrial goods, pharmaceuticals and food products. The main partners are the USA, EU countries, China, Japan.
The share of Swiss exports is almost half of GDP, which, of course, is a characteristic feature of the state economy. The country is a member of the WTO, engaged in the liberalization of world trade. However, the domestic market in Switzerland remains closed: sometimes citizens are forced to travel to make purchases abroad.
Agriculture
Despite the fact that a third of the entire territory of Switzerland is unsuitable for agriculture, and another quarter is occupied by forests, the state provides itself with meat and dairy products, as well as wheat. This food is even produced in abundance. Nevertheless, about 40% still have to be imported.
The Swiss economy is aimed at using its strengths. Even in negative conditions for the development of agriculture, success has been achieved in dairy production and animal husbandry. Swiss cheeses have become one of the most famous and delicious in the world. The main agricultural products are beets, potatoes and wheat. Agriculture is most common in the cantons of Zurich, Friborg, Argau, Vaud, Bern, which is explained by their geographical location.
Energy and minerals
The mountainous terrain, together with the turbulent rivers, provided the country with hydropower, which amounted to about half of all generated energy. For a long time, five nuclear power plants functioned and about 10 more were planned in the projects. After the Fukushima accident, the government revised its views on the use of nuclear power plants. A strategy has been developed that involves the complete abandonment of nuclear energy by 2050. However, in 2016, some political parties oppose a complete rejection of nuclear power plants, since no alternative was found, and nuclear energy provides about half of the state’s electricity needs. It is also noted that it is in Switzerland that the NPPs are the most reliable and durable.
The development of hydropower is the main sector of the use of minerals, which are practically absent in the country. Oil and gas have to be imported from abroad. The wise use of natural resources, in this case the highlands, has a positive effect on the economy of the state. Due to the fact that no alternative sources of energy generation were found, the issue of decommissioning of nuclear power plants remains unresolved.
Banking activity
The structure of the Swiss economy consists not only of the manufacturing and agricultural sectors. Attracting foreign capital is one of the main methods of development of the state. Banks of Switzerland are considered the most promising and reliable. Only in this country can a depositor not have to worry about the safety and security of his savings. All cash transactions are carried out using a special code. No one has the right to know the identity of a Swiss bank user. Intelligence agencies may require that data be provided only if a criminal offense is confirmed.
Switzerland's unshakable neutrality attracts investors from many different countries. Even during the First and Second World War, the leaders of the participating states preferred to “hide” their hard-earned money precisely in Swiss banks. Continuous capital inflows have a positive effect on the Swiss economy. The funds are used for the development of industry, small enterprises or as loans to other states. Zurich has a global exchange for gold trading. The welfare of almost the entire planet depends on the established course in the future.
Road junction
Switzerland has a highly developed communication with other parts of the world. The country's economy, aimed at large volumes of export, requires a good road junction. The railways of a small state are some of the best in Europe. Almost all of them are electrified.
Switzerland has only one navigable route to the sea - the Rhine river in Basel - Rheinfelden. The length of the site is 19 kilometers. A river port has been built here for sending industrial goods to other countries.
