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Short Economic Analysis of Switzerland

Submit an economic analysis of Switzerland, including things such as trade analyses, government regulations.

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Despite a dearth of natural resources, the Swiss economy is among the world's most advanced and prosperous. Per capita income is virtually the highest in the world, as are wages. Trade has been the key to prosperity in Switzerland. The country is dependent upon export markets to generate income while dependent upon imports for raw materials and to expand the range of goods and services available in the country. Switzerland has liberal investment and trade policies, notwithstanding agriculture, and a conservative fiscal policy. The Swiss legal system is highly developed, commercial law is well defined, and solid laws and policies protect investments. The Swiss franc is one of the world's soundest currencies, and the country is known for its high standard of banking and financial services. Switzerland is a member of a number of international economic organizations, including the World Trade Organization (WTO), the International Monetary Fund, the World Bank, and the Organization for Economic Cooperation and Development (OECD).

The Swiss economy expanded by 3% during the first half of 2007, the fastest rate in six years, thus confirming sustained growth over the last four years. GDP growth was primarily due to the positive evolution of private consumption and expansion of investment in fixed assets and software. For once, all export industries benefited from increased demand from foreign markets. With a surplus of $9.6 billion (SFr 11.7 billion), the Swiss trade balance reached unprecedented levels. On the inflation side, import prices increased more rapidly than exports.

Switzerland was ranked as the most competitive economy in the World Economic Forum's 2006 Global Competitiveness Report for the first time, reflecting the country's sound institutional environment, excellent infrastructure, efficient markets, competent macroeconomic management, world-class educational attainment, and high levels of technological innovation, which boost Switzerland's competitiveness in the global economy. The country has a well-developed infrastructure for scientific research, companies spend generously on research and development, and intellectual property protection is strong. Business activity benefits from a well-developed institutional framework, characterized by the rule of law, an efficient judicial system, and high levels of transparency and accountability within public institutions. Higher education and training are rapidly growing in importance as engines of productivity growth.

Being a nation that depends upon exports for economic growth, and due to the fact that it is so closely linked to the economies of Western Europe and the United States, Switzerland was not able to escape recent slowdowns experienced in these countries. During most of the 1990s, the Swiss economy was Western Europe's weakest, with annual GDP growth averaging 0% ...

Solution Summary

Submit an economic analysis of Switzerland, including things such as trade analyses, government regulations.