Switzerland » Introduction

Basic Economic Facts

GDP composition by Sector

Switzerland is a prosperous and stable modern market economy, with a per capita GDP that is higher than those of the big western European economies. For much of the 20th century, Switzerland was the wealthiest country in Europe by a considerable margin. However, since the early 1990s it has suffered from slow growth and, as of 2005, fell to fourth among European states with populations above one million in terms of Gross Domestic Product per capita at purchasing power parity, behind Ireland, Denmark and Norway. Switzerland is a member of the European Free Trade Association. 

In recent years, the Swiss have brought their economic practices largely into conformity with those of the European Union, in an effort to enhance their international competitiveness, but this has not produced strong growth. Full EU membership is a long-term objective of the Swiss government, but there is considerable popular sentiment against this. To this end, it has established an Integration Office under the Department of Foreign and Economic Affairs. To minimise the negative consequences of Switzerland's isolation from the rest of Europe, Bern and Brussels signed seven agreements, called bilateral agreements, to further liberalise trade ties. These agreements were signed in 1999 and took effect in 2001.

This first series of bilateral agreements included the free movement of persons. A second series covering nine areas was signed in 2004 and awaits ratification. The second series includes the Schengen treaty and the Dublin Convention. A full report on the potential advantages and inconveniences of full EU membership is expected to be published in June 2006 by the Department of Foreign affairs. EU membership supporters hope this report could help reopen the internal debate, which has been dormant since March 2001, when the Swiss people refused in a popular vote to start accession negotiations with the EU.