Swiss economic structure is characterized by a pronounced orientation towards international trade in goods and services as well as on cross-border investment activities, besides the banking and pharmaceutical industries.
According to the World Economic Forum’s (WEF) 2015-16 Global Competitiveness Index, Switzerland is the world’s most competitive economy for the seventh year consecutively, this due to its low tariffs on manufactures and absence of quantitative restrictions.
The 15th largest export economy in the world and the 2nd most complex economy according to the Economic Complexity Index (ECI), Switzerland has exported only in 2015 $279B and imported $261B, resulting in a positive trade balance of $17.5B.
Swiss trading
Switzerland is member of World Trade Organization. Also, though is not member of European Union, Switzerland has close ties with EU compared to other non-European Economic Area Countries, through Free Trade Agreement from 1972. Switzerland currently has a network of 28 free trade agreements (FTAs) with 38 partners outside the EU.
Switzerland has a small domestic market and limited resources, which makes the nation reliant on imports. Key Switzerland import commodities are:
· Chemicals
· Metals
· Agricultural products
· Textiles
· Machinery
Switzerland major trade partners are: Germany, US, Italy and France.
Here, it is important to mention the existence of The Swiss Trading & Shipping Association (STSA), a non-profit, non-political Swiss association representing companies active in commodity trading and shipping activities, trade finance and related services. Since its creation in 2014 it acts as the umbrella organization for the sector in Switzerland, bringing together 3 regional associations (Geneva Trading and Shipping Association, Lugano Commodity Trading Association, Zug Commodity Association), 190 members and institutions, and over 100 professionals participating in STSA Committees and expert Working Groups.
Switzerland exports
Exports from Switzerland amounted to US$303.1 billion only in 2016. Year over year Swiss exports increased in value by 3.8%. Switzerland’s top 10 exports accounted for 87.3% of the overall value of its global shipments. According to the International Monetary Fund’s World Economic Outlook Database, Switzerland’s total Gross Domestic Product as of October 2016 was in a total amount of $494.3 billion, the exports accounting for about 61.3% of total Swiss economic value.
The top exports of Switzerland are Gold ($65.3B), Packaged Medicaments ($31.9B), Human or Animal Blood ($18.1B), Base Metal Watches ($13.3B) and Precious Metal Watches ($8.66B), using the 1992 revision of the HS (Harmonized System) classification.
Switzerland imports
Key products imported by Switzerland in 2015 were amounting $261B, making it the 17th largest importer in the world. With any average of 4% annual increase the Swiss imports developed from $210B in 2010 to $261B in 2015. The most important imports are in Gold which represent 27.7% of the total imports of Switzerland, followed by Packaged Medicaments, which account for 5.36%. Switzerland’s mineral resources are limited and although Switzerland is a manufacturer of agricultural products, the country still relies on imported products to satisfy the commercial demand.
With highly positive net exports in the international trade of pharmaceuticals, Switzerland’s strong competitive advantages under the drugs and medicines product category should be taken into consideration when thinking to form a company in Swiss trading field. Other domains to invest into are also the watches and jewelry, optical, technical, medical apparatus, organic chemicals, machinery including computers and perfumes, cosmetics.
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