SWITZERLAND
GEOGRAPHY
Switzerland, officially the Swiss Confederation, is a country situated in the confluence of western, central, and southern Europe. It is a federal republic composed of 26 cantons, with federal authorities seated in Bern. Switzerland is a landlocked country bordered by Italy to the south, France to the west, Germany to the north, and Austria and Liechtenstein to the east. It is geographically divided between the Alps, the Swiss Plateau (or mittelland) and the Jura, spanning a total area of 41,285 km2, and land area of 39,997 km2. While the Alps occupy the greater part of the territory, the Swiss population of approximately 8.5 million is concentrated mostly on the plateau, where the largest cities are located, among them the two global cities and economic centres of Zürich and Geneva.
HISTORY
Switzerland shares a lot of its history and of its culture, as for the four national languages spoken in different parts of the country, with its neighbours Germany, France, Italy and Austria. When does the history of Switzerland begin? The answer depends on the interpretation of the term Switzerland:
Switzerland’s official Latin name “Confoederatio Helvetica” goes back to a Celtic tribe called the Helvetians.
The majority of Switzerland’s “native” population settled during the Germanic Migration of Nations that set an end to the Roman Empire in Western Europe at about 400 A.D.
The French Revolution and the subsequent Napoleonic Wars altered the face of Europe in those years. Switzerland, too, was not able to escape these changes. However, the legal equality that was being demanded primarily by the rural subject territories in opposition to the old elite was only established when in 1798 French troops marched in and the political system of the thirteen-canton Confederation collapsed, to be replaced by the centralised unitary state of the Helvetic Republic.
Under a new Federal Pact signed in August 1815 the cantons recovered their (almost) complete sovereignty in all matters except foreign affairs. After the defeat of the conservative Catholic cantons, Switzerland was transformed into a modern federal state with cantonal authority restricted by the Federal Constitution of 1848 (then finalized in 1874).
SOCIAL CULTURE AND RELIGION
Switzerland has often seen itself, or has been seen by others, as a “special case” (Sonderfall), largely because of multilingualism, its diversified cultural patchwork, and its institutions, but also because of its economic success after World War II. Although some of the political and institutional peculiarities still persist, the rapid modernization of daily life in Switzerland is reflected in changes in the country’s habits and cuisine.Swiss cuisine has traditionally been marked by important cultural and regional variations. Cheese dishes are typical of the Alpine regions. The national dish, fondue neuchâteloise (a mixture of melted Emmentaler and Gruyère cheeses and wine into which bread cubes are dipped), and raclette (cheese melted over a fire and scraped over potatoes or bread) are popular not only throughout the country but in much of the world. The Swiss chocolate industry, which originally grew out of the need to utilize the abundant milk produced in the pre-Alpine dairying regions, is world famous. Also popular are spiced, glazed honey cakes known as Leckerli. The preferred dish of German Switzerland is Rösti (fried shredded potatoes), but sausages and sauerkraut are also popular. Other popular dishes include Zürcher Eintopf, or Zürich-style beef stew, and, around the lakes of eastern Switzerland, the delicate fish Zander (pike perch). Specialty and seasonal dishes, such as the autumn bratwurst from Sankt Gallen, distinguish one region from another, as do the country’s abundant wines and beers (which now include Maisgold, or beer made from corn). Western Switzerland is influenced by French cuisine and culture, and in Ticino pasta, polenta, and risotto are signs of a common culture with Italy. Despite the longevity of traditional culinary influences, modern Swiss cuisine is characterized by international trends, and restaurants with cuisines from all over the globe can be found even in smaller cities. There are many American fast-food chains, even in Alpine resorts such as Zermatt and Saint Moritz. Visitors to Switzerland go there to eat, but more go to shop, especially along Zürich’s famed Bahnhofstrasse, an avenue that is home to both fine shops—including the country’s renowned jewelers and watchmakers and leading banks. Along the Bahnhofstrasse, shoppers can find Switzerland’s famous timepieces, local handicrafts, and books as well as dine in elegant cafés. Each city and town of any size has a similar venue, and some have more than one shopping district; for example, just across the Limmat River from the Bahnhofstrasse lies Zürich’s youth-oriented Niederdorfstrasse, which features bistros, shops, and ethnic restaurants. In general, the habits of city dwellers mirror those of urbanites in other parts of the world. Typical Swiss folk culture (e.g., yodeling and playing the alphorn) is still practiced in some rural areas. Early autumn’s annual Alpabzug, in which cattle are driven from Alpine pastures to lower elevations, is the occasion for rural fairs and auctions that emphasize rural traditions, and many cities and larger towns host farmers’ markets that join urban and rural areas. Stand wrestling (Schwingen), in which combatants wear wrestling breeches, can be seen in many regional festivals, and in some mountain villages, such as in Valais, traditional rural costumes are sometimes worn. Family and household structures have considerably changed since the mid-20th century. The divorce rate nearly quadrupled between 1960 and the turn of the 21st century. The proportion of family households dropped, a reflection of both an increase in divorce rates and an aging population. Swiss tradition survives in the country’s many holidays and festivals. Fasnacht (Carnival), which marks the beginning of Lent, is celebrated in late winter throughout the country, with Basel’s parades being of particular note. Although costumes and music are common features, Fasnacht exhibits regional variations, and in some places celebrants are adorned with masks said to chase away evil spirits. Masks are also part of Sylvesterkläuse (New Year) celebrations, particularly in rural Switzerland. Spring is marked by the burning of the Böögg during a festival that dates from 1818, when a guild held a parade replete with music and horses. The festival, which marks the end of winter, terminates with the burning of a large woodpile topped by a snowman. Throughout the fall there are various harvest and wine festivals. A popular holiday in Geneva is the Escalade, which is celebrated in December and marks the city’s victory over the duke of Savoy in 1602. August 1 is National Day (German: Bundesfeier; French: Fête Nationale; and Italian: Festa Nazionale), which commemorates the agreement between representatives of the Alpine cantons of Uri, Schwyz, and Nidwalden, who signed an oath of confederation in 1291. The holiday itself, however, dates only from 1891, and it became an official federal holiday in 1993. Other official holidays are religious in origin, and many of them, such as Whit Monday and Assumption, are observed in only some cantons.
POLITICS
ORGANIZATION OF THE CANTONS
Switzerland is made up of 26 cantons which enjoy a high degree of autonomy due of the federal government. Each is an independent and sovereign entity, with their own capital town or city. The cantons vary greatly as to size, culture, religion and socioeconomic structure. With 1.4 million inhabitants, the canton of Zurich is the most heavily populated, while Appenzell-Innerrhoden, with a mere 15,500 inhabitants, is the most sparsely populated canton in Switzerland. Six cantons, historically referred to as “half-cantons”, send only one deputy (compared to the two sent from each of the regular cantons) the Council of States (upper house of the Federal Assembly). They are Obwalden, Nidwalden, Appenzell-Innerrhoden, Appenzell-Ausserrhoden, Basel-Stadt and Basel-Land.
ROLE OF THE CANTONS
Each canton has its own constitution, parliament, government and courts. According to the principle of subsidiarity enshrined in the Federal Constitution, all powers that are not expressly granted to the Confederation fall within the competence of the cantons. The cantons enjoy a high degree of autonomy in areas like education, health and policing. The cantonal parliaments vary in size, with the number of popularly elected deputies ranging from 50 to 180. The five- or seven-member cantonal governments are also directly elected by the people.
ECONOMY
A wealthy country, Australia has a market economy, a high GDP per capita, and a relatively low rate of poverty. In terms of average wealth, Australia ranked second in the world after Switzerland from 2013 until 2018. In 2018, Australia overtook Switzerland and became the country with the highest average wealth. Australia’s poverty rate increased from 10.2% to 11.8%, from 2000/01 to 2013. It was identified by the Credit Suisse Research Institute as the nation with the highest median wealth in the world and the second-highest average wealth per adult in 2013. The Australian dollar is the currency for the nation, including Christmas Island, Cocos (Keeling) Islands, and Norfolk Island, as well as the independent Pacific Island states of Kiribati, Nauru, and Tuvalu. With the 2006 merger of the Australian Stock Exchange and the Sydney Futures Exchange, the Australian Securities Exchange became the ninth largest in the world. Ranked fifth in the Index of Economic Freedom (2017), Australia is the world’s 14th largest economy and has the tenth highest per capita GDP (nominal) at US$55,692. The country was ranked third in the United Nations 2017 Human Development Index. Melbourne reached top spot for the fourth year in a row on The Economist’s 2014 list of the world’s most liveable cities, followed by Adelaide, Sydney, and Perth in the fifth, seventh, and ninth places respectively. Total government debt in Australia is about A$190 billion— 20% of GDP in 2010. Australia has among the highest house prices and some of the highest household debt levels in the world. An emphasis on exporting commodities rather than manufactured goods has underpinned a significant increase in Australia’s terms of trade since the start of the 21st century, due to rising commodity prices. Australia has a balance of payments that is more than 7% of GDP negative, and has had persistently large current account deficits for more than 50 years. Australia has grown at an average annual rate of 3.6% for over 15 years, in comparison to the OECD annual average of 2.5%. Australia was the only advanced economy not to experience a recession due to the global financial downturn in 2008–2009. However, the economies of six of Australia’s major trading partners have been in recession, which in turn has affected Australia, significantly hampering its economic growth in recent years. From 2012 to early 2013, Australia’s national economy grew, but some non-mining states and Australia’s non-mining economy experienced a recession. The Hawke Government floated the Australian dollar in 1983 and partially deregulated the financial system. The Howard Government followed with a partial deregulation of the labour market and the further privatisation of state-owned businesses, most notably in the telecommunications industry. The indirect tax system was substantially changed in July 2000 with the introduction of a 10% Goods and Services Tax (GST). In Australia’s tax system, personal and company income tax are the main sources of government revenue. As of September 2018, there were 12,640,800 people employed (either full- or part-time), with an unemployment rate of 5.2%. Data released in mid-November 2013 showed that the number of welfare recipients had grown by 55%. In 2007 228,621 Newstart unemployment allowance recipients were registered, a total that increased to 646,414 in March 2013. According to the Graduate Careers Survey, full-time employment for newly qualified professionals from various occupations has declined since 2011 but it increases for graduates three years after graduation. Since 2008, inflation has typically been 2–3% and the base interest rate 5–6%. The service sector of the economy, including tourism, education, and financial services, accounts for about 70% of GDP. Rich in natural resources, Australia is a major exporter of agricultural products, particularly wheat and wool, minerals such as iron-ore and gold, and energy in the forms of liquified natural gas and coal. Although agriculture and natural resources account for only 3% and 5% of GDP respectively, they contribute substantially to export performance. Australia’s largest export markets are Japan, China, the United States, South Korea, and New Zealand. Australia is the world’s fourth largest exporter of wine, and the wine industry contributes A$5.5 billion per year to the nation’s economy.
IMPORT/EXPORT
IMPORT
Switzerland mainly imports metals, machinery and chemicals. The most imported good in Switzerland is gold, that represents 21% of the country’s total imports. The second place is occupied by medicines, with almost 6%, and cars and car parts with almost 5%. Refined petroleum and jewels are also imported in Switzerland but in smaller quantities, that reaches almost 4%. Other products imported into Switzerland are the following: textiles, agricultural products, computers and chemical products. Swiss imports are based on German products with a share of 24%, Italian goods with 11% and U.S. goods that supply almost 10%. France supplies almost 7% of the country’s imports, while countries like China and Austria provide almost 4% of Swiss imports. Switzerland also imports goods from Austria, the United Kingdom, the Netherlands, Ireland, Japan and Russia. The top import countries in 2018 were the following:
- the main import country was Germany, accounting for imports with a value of $57,788 million;
- the second import country was the United Kingdom, with imports accounting for $26,549 million;
- the 3rd most important import country was Italy ($21,283 million), while the 4th was the United States ($21,250 million);
- the 5th trading partner was France ($19,853 million) and the 6th was China ($14,757 million);
- the 7th most important trading partner was the United Arab Emirates ($10,350 million), while the 8th was Ireland, accounting for $8,799 million.
EXPORT
The basic products that are exported from Switzerland are gold, pharmaceutical goods and watches. The first place in Switzerland’s exports is occupied by gold with almost 20% and the second place is occupied by pharmaceuticals that represent almost 11.5% of the country’s total exports. With a share of 5% of all the Swiss exports, watches represent the third most traded product from this country. Other important products exported from Switzerland refer to medical devices, machinery and jewelry. The countries Switzerland exports to are Germany, that imports 17% of Swiss goods, India, that occupies the second place with 11% of the goods exported from Switzerland, the United States, where Switzerland exports almost 9% of its products and services, followed by Hong Kong and France where Switzerland’s exports reach 6%. Other important export partners of Switzerland are the following: China, Japan, Austria, Turkey, the United Kingdom and Italy. In relation to the Swiss exports, at the level of 2018, the following data is available:
- the country’s main trading partner was Germany, to which it exported goods with a value of $47,447 million;
- the second trading partner is the United States, where Switzerland exported goods accounting for $40,959 million;
- the 3rd export partner is China, accounting for $30,260 million and the 4th export country is France;
- exports to France had a value of $19,738 million, while with the 5th trading partner, India, exports stood at $17,837 million;
- the 6th and the 7th trading partners were Italy and Hong Kong, accounting for $16,581 million and $16,024 million respectively.
INTERNATIONAL RELATIONS
Switzerland’s foreign policy strategy 2020-2023 focuses amongst others on the consolidation and the development of the bilateral path with the European Union (EU). In this context, relations with the EU member states and in particular with Switzerland’s neighbouring countries play a key role. Situated at the heart of the European continent, Switzerland maintains close political, economic and cultural exchanges with the EU and its member states. The FDFA runs the Confederation’s Centre of Expertise for Policy on Europe and represents Liechtenstein’s interests abroad. Switzerland has close economic, social and cultural ties with its neighbours, in particular with the regions directly on its borders. Maintaining relations with these regions and states is therefore of great importance in terms of foreign policy. The settlement of any unresolved issues and the search for constructive solutions is weighted accordingly by all parties involved. Switzerland and its neighbours are closely interdependent, with ties based on shared political, linguistic, economic and cultural characteristics and interests. Some two thirds of EU citizens residing in Switzerland are from neighbouring states. Germany, France, Italy and Austria account for almost 70% of all Switzerland’s trade with the EU. These four large neighbouring states are also important members of the EU. This means Switzerland has a strong interest in fostering permanent dialogue with them on its relations with the EU. Moreover, France, Germany and Italy are members of the G7, while France also has a permanent seat on the UN Security Council.Transport, finance, taxation and energy are the main focuses for cooperation with neighbouring states. Switzerland’s ties with regions directly bordering it are especially strong. This can be seen in particular in its trade relations with Baden-Württemberg, Bavaria and Lombardy, for example. The volume of trade between Switzerland and the regions directly on its borders amounts to almost CHF 90 billion annually, which is half of Switzerland’s total trade in goods with neighbouring states. By comparison, Switzerland’s annual trade in goods with the United States amounts to CHF 60 billion, while trade with Brazil, India, China and South Africa combined totals CHF 74 billion. Southern Germany and northern Italy are two of the most competitive regions in Europe, and both share a direct border with Switzerland. Excellent relations with these regions contribute greatly to Switzerland’s economic success. Strategic support in the process of cross-border cooperation is provided by the FDFA (Swiss Federal Department of Foreign Affairs), particularly within the framework of bilateral contacts with neighbouring states, and by developing legal mechanisms at bilateral and multilateral level. Meetings between senior representatives of the FDFA and the foreign ministries of neighbouring states help to further strengthen the cross-border exchange of information and to facilitate the resolution of problems between neighbours, in particular through intergovernmental commissions or regular meetings on cross-border issues (known as cross-border dialogue).