Abstract

One of the smallest and most prosperous nations in the world, Switzerland, symbolises: democracy, fairness, stability, quality, meticulousness, punctuality, thrift, efficiency, hospitality, openness, and political neutrality. The country is well known for its watches and chocolates. For a small, landlocked country of 7 million people with a difficult geography and no natural resources to speak of, the Swiss economy has done remarkably well for several decades. But since the early 1990s, Switzerland’s income per head has been almost static. One reason is it’s over dependence on exports. The country suffered badly in the early 2000s when the dotcom bubble burst, stock markets collapsed and other economies slowed down. Switzerland has also seen a huge rise in public expenditure in recent years. Spending on health care and disability pensions have gone out of control. Also, with an ageing population, retirement pension is becoming a major concern. The unemployment rate has reached high levels by the country’s standards and is showing no signs of coming down.

Learning Objectives

The case is structured to achieve the following Learning Objectives:

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Keywords

Switzerland, Swiss economy, OECD, Organisation of Economic Co-operation and Development, The oldest democracy, Swiss watches, Swiss chocolate, European Free Trade Agreement, European Economic Area, Swiss franc, GDP, gross domestic product, Swiss People's Party, SVP, Swiss Confederation, Swiss National Bank, SNB, Pascal Couchepin, UBS, Union Bank of Switzerland