![\"edelweiss](\"http:\/\/www.sdaconseil.com\/blog\/wp-content\/uploads\/2013\/08\/edelweiss-pic.png\")
<\/a><\/p>\nIt is not just the heat wave that is melting European hearts this summer.\u00a0 Dreadful economic figures are drowning optimism like a tidal wave. \u00a0Banks are still wobbling, growth remains elusive at best and unemployment is scarring a generation.\u00a0 A particularly worthy indicator speaks in the same tone:\u00a0 new car registrations in the Euro zone have fallen by 12%in the last year, and by 26% compared to 2006.\u00a0 Even Picasso would be challenged to brighten the picture.<\/p>\n
Yet a few bright spots exist in Europe, and in none other than the Swiss confederation.\u00a0 Numbers speak loud and clear for themselves:\u00a0 Growth has ranged from 2% to 4% since 2006 and was negative only in 2009 (-1.9%).\u00a0 \u00a0Inflation hovers around 1% and last month unemployment went down to 2.9%.\u00a0 Contrary to the rest of Europe, Government debt as a % of GDP went down from 54% in 2006 to only 34% in 2012. A stunning performance despite a strong Swiss franc.<\/p>\n
For the last decade the Swiss franc has consistently remained way above parity with the US dollar and the Euro.\u00a0 Playing proxy to the defunct Deutsche Mark should have pulled down the trade balance, but hell no!\u00a0 Exports are still climbing and the trade balance is positive and healthy. Furthermore, and in spite of a high cost of living, Switzerland collects much Foreign Direct Investment, lured by substantial tax incentives.<\/p>\n
This is no story of luck.\u00a0\u00a0And theirs is no quick\u2019n easy recipe to emulate either. Yet behind the hard work and discipline of the Swiss lie a few smart lessons for the rest of us.\u00a0 Here are five reasons why the Helvetic economy runs so smoothly.<\/p>\n
1. A diversified economy: \u00a0An economy split\u00a01% in agriculture, a healthy 28% into manufacturing and 71% in services.\u00a0 Swiss manufacturing aims at the resilient end of the spectrum: High quality, precision and high tech.\u00a0\u00a0 In a nutshell, goods of high value added.\u00a0 The Swiss hung on to their manufacturing in the last decade and they are one of the few countries to register a trade surplus with China\\Hong Kong.\u00a0 Somehow most regions of the country are doing reasonably well:\u00a0 Chemicals in Basel, watches in the Jura, international organizations in Geneva and tourism in the Alps.\u00a0 Equipment and machinery are doing fine in Zurich.\u00a0 This time it is the Swiss banks that are blotting the clean sheet as they are struggling past the financial crisis and are mired in international tax issues.\u00a0 This is opening the door for Singapore to jostle for the top wealth management center.<\/p>\n
2.\u00a0 Fiscal prudence:\u00a0 Swiss like to build reserves for the rainy days and federal laws prevent the build-up of budget deficits.\u00a0 Public subsidies are limited and several public services are closer to market prices than in the rest of Europe.<\/p>\n
3.\u00a0 Culture of work:\u00a0 The Swiss work a full 42 hours a week and have once turned down a referendum to increase annual holidays.\u00a0 It is not unusual to see executives switch on their office light at 7 am.\u00a0 The famous apprenticeship system still works wonders to ingrain ethics and discipline at work.\u00a0 Doing a good job remains a personal pride.<\/p>\n
4.\u00a0 Innovation in the blood:\u00a0 Switzerland regularly tops surveys as the most innovative country in the world.\u00a0 We all know that the country developed a culture of inventiveness to make up for limited natural resources.\u00a0 What is little known is the fact that the Swiss don\u2019t throw at all any R&D tax credits at companies.\u00a0 Innovation is first and foremost led by industry.\u00a0 The last OECD report highlights the fact that about 65% of Swiss companies are considered innovative and 50% do R&D activities.\u00a0 This is naturally to be expected from the Swiss multinationals.\u00a0 But when we consider that 90% of Swiss companies have 10 employees or less, just like in most other countries, these statistics bear weight and meaning.\u00a0 The main point is that Swiss companies do learn to be innovative regardless of their size.\u00a0\u00a0 The government programs to support technology transfers between universities and industry, incubators and start-up accelerators, are not meant to be the main policy about innovation, but rather\u00a0to be\u00a0complementary to the industry’s efforts to innovate.<\/p>\n
5. \u00a0High propensity to deliberate:\u00a0\u00a0 There is a silent majority who thinks there is somehow an excess of referendums and party initiatives in Switzerland.\u00a0\u00a0 For outsiders they may look cumbersome and some issues might appear menial to the unadvised eye.\u00a0 Nevertheless the propensity of the Swiss society to deliberate comes in handy in times of global changes.\u00a0 They might not always move fast, but they usually move in the right direction and stay ahead of the curve.\u00a0 They created the World Economic Forum in 1971. Then in 1999 they set up the Swiss Economic Forum entirely dedicated to their SME, just when the rise of Asia was mixing in the cards.\u00a0 And now they have just signed the first free trade agreement in continental Europe with China. Switzerland was in effect the first country to recognize the RPC in 1950 and not surprisingly was the first to be granted a \u2018Certified Travel Destination\u2019 by China in 2004.\u00a0 In 2012, 800k Chinese visitors roamed the country.<\/p>\n
Transparent deliberations are a cornerstone of Swiss politics as well: meant to they keep their politicians on their toes!\u00a0 Transparency pushes politicians to actually earn the trust of people, a process which discourages murky abuses.\u00a0 Direct democracy makes their governments quite responsible to deliver on essential services, on security and order, and on fiscal responsibility.\u00a0 The Swiss like to keep their politics open and transparent, but they will in turn often vote bearing in mind the greater good of the nation because they have trust in their institutions.<\/p>\n
For the time being, it is all working like a Swiss clock.<\/p>\n
Andre Du Sault. MBA (LBS), MPA (Harvard)<\/p>\n","protected":false},"excerpt":{"rendered":"
Lugano, 31 July 2013 WHAT EXPLAINS THE STUNNING PERFORMANCE OF SWITZERLAND? It is not just the heat wave that is melting European hearts this summer.\u00a0 Dreadful economic figures are drowning optimism like a tidal wave. \u00a0Banks are still wobbling, growth remains elusive at best and unemployment is scarring a generation.\u00a0 A particularly worthy indicator speaks […]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[3,5,7,8],"tags":[],"_links":{"self":[{"href":"https:\/\/sdaconseil.com\/index.php?rest_route=\/wp\/v2\/posts\/368"}],"collection":[{"href":"https:\/\/sdaconseil.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/sdaconseil.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/sdaconseil.com\/index.php?rest_route=\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/sdaconseil.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=368"}],"version-history":[{"count":5,"href":"https:\/\/sdaconseil.com\/index.php?rest_route=\/wp\/v2\/posts\/368\/revisions"}],"predecessor-version":[{"id":376,"href":"https:\/\/sdaconseil.com\/index.php?rest_route=\/wp\/v2\/posts\/368\/revisions\/376"}],"wp:attachment":[{"href":"https:\/\/sdaconseil.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=368"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/sdaconseil.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=368"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/sdaconseil.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=368"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}