Socially - the economics of Switzerland

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COURSE WORK

On a theme: «SOCIALLY - the ECONOMIC SITUATION of Switzerland»

Minsk 2011



Introduction

economic import export political

"Switzerland is paradise", - the queen of the Great Britain Elizabeth II during the visit to Bern has told. Sounds enthusiastically, and the queen is not far from true...

In one fairy tale it is told, that when the Lord the God distributed riches of bowels by the ground, they have not sufficed it for one tiny country in heart of Europe. To correct this injustice, the Lord has given to this country the mountains similar to heavenly locks, the enormous glaciers, roaring falls, uncountable lakes and affable fertile valleys. Thus, Switzerland became a perfect embodiment of divine wisdom.

Switzerland - a real-life myth. Here you will meet more contrasts, than no matter where. An amazing variety of a landscape, architecture, languages and culture transform this country into the special small world, to Europe a pocket format.

Switzerland (the Swiss republic) - the small state in the Central Europe. The date of creation of Switzerland considers on August, 1st, 1291 when 3 cantons have united in confederation, and only according to the constitution of 1848, the union of the states has turned to the uniform state - federal Switzerland.

To the middle of the last century Switzerland was shaken time and again by wars for the power and religious wars. In the country there are no minerals and there is no exit to the sea. To the middle of XIX century Switzerland was one of the poorest countries of Europe.

For today, Switzerland - one of the countries of the world most developed in the industrial relation, occupying one of the first places on experience and qualification of engineers and workers, quality of made production and on the sizes of profits which are received by Switzerland from the industrial enterprises which are in the country and behind its limits, from enormous capital investments.

This small country plays an appreciable role in a world political life. Thanking its constant neutrality, and also a geographical position in it the important international conferences, diplomatic negotiations are spent.

Switzerland - the country of contradictions. Here speak in four languages, live in twenty six historically developed cantons differing from each other. A considerable part of its population are cultural, ethnic, religious and language minority.



1. A brief information on the state

The official name: the Swiss Confederation

Geographical position: in the Central Europe; borders in the north - on Germany, in the west - with France, in the south - with Italy, in the east - with Austria and Liechtenstein

The area: 41,3 thousand км²

Capital: Bern (229 thousand people)

The largest cities: Zurich (839 thousand people), Geneva (389 thousand people), Lausanne, Basel

Administrative division: 23 cantons (3 from them are divided into semicantons). From the point of view of administrative-territorial division and a state system Switzerland is the most difficult federative state

State system: federal parliamentary republic in which the system of direct democracy allows citizens to accept active participation in a country government.

The head of the state: the president

The head of the government: the president

Legislature:

1. Two-chamber federal meeting (National board from 200 deputies selected for 4 years;

2. Council of cantons from 46 deputies selected for 3 or 4 years).

Leading political parties: Social-democratic party of Switzerland, Considerably-democratic party Switzerland, the Swiss people party, Green Party of Switzerland

Armed forces: 3,5 thousand people

The main rivers: Rhine, Aare, Rhone

Number: 7,5 million people

Switzerland with average population density 183 people on 1 км2 - densely occupied country. But population distribution on territory very variously. So, for example, in mountain areas of the Alpes occupying almost 60 % of the area of the country, lives only 10 % from a population aggregate number.

Average life expectancy: men 79года, women 84год

Switzerland has the general borders with five countries: in the north with Germany, in the east with Liechtenstein and Austria, in the south with Italy and in the west - with France. Thus, here as in focus three European cultures - German, French and Italian converge.

Official languages: German (64 %), French (19 %), Italian (8 %), ретороманский (1 %)

Believers: Catholics (48 %), Protestants (44 %)

Employment: 1. Agriculture and a mining industry - 6,7 %

2. A manufacturing industry and building - 37,5 %

3. Banks and sphere of services - 55,8 %

Monetary unit: the Swiss franc

GNP per capita: 45 500$

Export: 1. Cars and the equipment

2. Chemicals

3. Medicines,

4. Hours, exact devices

5. Textiles, clothes

6. A foodstuff, including chocolate.

Import: 1. Cars and the equipment

2. Cars

3. Oil and mineral oil

4. Raw materials

The basic trading partners: the EU countries, the USA, Japan.



2. A political system

2.1 The supreme bodies of the power of the state: their formation, powers, structure

Thanks to developed direct form of democracy in Switzerland the people directly participate in the legislation as the states, and cantons.

Principal organs of the Swiss Confederation - federal council, federal meeting and federal court.

Executive office is federal council from seven members selected parliament for a period of four years. Unique formal restriction on structure of this body consists that from each canton one deputy can be selected only. However actually the council structure is strictly limited to traditions: for example, in it the basic geographical areas of the country and two of language groups (ex - and италоязычная) should be necessarily presented. About 1959 structure of council whenever possible reflected influence of the main political parties. Every year one of members of council is selected the president of Switzerland, but this post is not invested by special imperious powers.

Federal council consists of seven members. Its problems are subdivided accordingly into seven various branches:

1. Department of foreign affairs;

2. Department of internal affairs;

3. Justice and police department;

4. Military department;

5. Department of the finance;

6. National economy department;

The legislature.Наряду with the people, the higher authority in the state is parliament - federal meeting - consists of two chambers: council of cantons and national board.

The national board is people representation. 200 members of this Council get out by quantity of the population living in cantons. Each canton has in National board, at least, one member. Elections of national advisers are spent on a proportional electoral system and there pass each four years.

Council of cantons represents cantons and a federal element of Federal council. Each canton has in Council of cantons of two representatives. Their elections pass according to кантональным the right and procedure. Except for canton Uri, in elections the majority system is applied.

In legislative process both Councils are equal in rights. They hold the sessions and the decision separately from each other make. The decision of Federal meeting only then comes into force, if both Councils express the mutual consent on acceptance of this decision. In case of disagreements the question on which Councils have not come to the agreement, comes back in that Council which was engaged in it at first. Last discusses again the project taking into account a position of other Council. If after all coordination of the party nevertheless do not come to a common opinion, conciliatory conference is appointed. If the conciliatory offer is not accepted by one of Councils, the question from the parliamentary agenda acts in film, as it, most likely, yet has not ripened for the decision. The meeting is selected for a period of four years.

It possesses the usual legislative powers, however some laws should be approved a national referendum.

The federal court of Switzerland is in Lausanne, other main governmental bodies - in Bern. The federal court carries out functions of the Supreme court of the country though cannot declare federal laws unconstitutional. Federal courts of the lowest instance are not present, as courts of cantons are responsible for application of federal laws at the lowest levels. Into structure of federal court enter 26-28 judges and 11-13 jurymen sitting at separate premises depending on character of considered cases. Members of court are selected federal meeting for a period of six years. The social insurance court takes out decisions on the questions at issue connected with all kinds of public insurance. Military courts make of the decision on crimes and the offences made during passage by citizens of military service.

At level of cantons the executive power is carried out by the state or governmental council, in which structure from 5 to 11 members led by the president. Members of council are selected the population of cantons for a period of 4 years and in some small cantons work on public principles.

In the majority of cantons there is a uniform legislature - the big council, ground council, or the council of canton also selected for a period of four years. Legal bodies of canton are presented by courts of two or three levels depending on the sizes of canton. The most part of local features of the Swiss justice has been liquidated with introduction of the uniform national code civil, trading and criminal law in 1942.

2.2 The basic political parties

The party is an association of citizens which on the basic moments have the general for their idea about how the state should look and by what rules the life of people in a society should be regulated.

The party has for an object to send the delegates to parliament and the government, to influence the legislation and to take part in formation of political will as a whole. The program is for this purpose made.

In Switzerland to carry out the influence the considerable quantity of parties tries. That fact is remarkable, that members of any party in general are only about 10 % of voters. However the quantity of members is not identical at all to number of supporters of party.

In Switzerland is not present any politically мотивированных restrictions for parties so formation and activity of parties are limited it is unique the general law and order.

In Switzerland there was a multi-party system. On the right wing there is a Christian Democrat people party (in the past - Conservative socially-Christian or Is conservative-Catholic). The primary goal she sees in protection of the doctrine and institutes of Catholic church and in upholding of the rights of cantons, supports socially protected market economy.

The left flank occupies Social democratic (or Socialist) party which supports wide social reforms, including wider participation of the state in an economic life of the country, but at partnership observance between the state and private business.

In the centre of a political spectrum is Considerably-democratic party Switzerland. It was really radical under standards of XIX century when defined a policy of the country. In modern conditions this party became concerning conservative. Supports market economy both a political and spiritual personal freedom.

Each of three parties (Christian Democrat people party, Social-democratic party, Considerably-democratic party) keeps about the fifth part of all places in national board. Such parity of forces remains from elections to elections that provides Switzerland the political consent and stability. With 1959 each of these parties has on two of seven places in Federal council, and the remained place is occupied with the representative of largest of other parties - the Swiss people party

Among other small parties: "Green", the Union independent, Liberal party and freedom Party (the former Party of motorists). Last, formed in 1985, protects the rights of drivers of motor vehicles and supports immigration restriction.

2.3 The state constitution

The constitution of 1874 has replaced the Constitution of 1848 and was among so-called "old" constitutions. It included the short preamble, three heads and transitive positions.

Originally the Constitution text consisted of 123 articles, however for the history it has undergone to numerous changes and by 1985 54 new articles have been included in this certificate, and 52 from them have been left at existing numbers, but with addition of Latin words "encore", "rubbed" etc., and 54 articles have been cancelled or changed.

From actual 173 articles only 84 reflect the initial text of the Organic law of 1874 As a result of frequent changes the Constitution substantially has lost the unity and the internal logic.

The new Constitution of the Swiss Confederation has been accepted on a national referendum on April, 18th, 1999, having replaced the Constitution of 1874 operating to that time, and has come into force since January, 1st, 2000

The constitution of 1999 as a whole has appreciably kept former structure though in it became more sections and heads. The certificate volume has a little decreased, mainly at the expense of refusal of petty, scrupulous regulation, so characteristic 1874 for the Constitution

As a result the Constitution has taken modern enough form and in the structural relation became the Western Europe similar to similar certificates. On the first place the rights and freedom of the Swiss citizens, institute of citizenship and the social purposes of the state have been put. Then the norms regulating the relations between Confederation, cantons and communes follow. The following, separate section is specially devoted the political rights and the specific institute taking a special place in Switzerland, - to the national legislative initiative and a referendum. Regulation of structure of federal authorities and their mutual relations does not take the big place in the Organic law. In Switzerland at the constitutional level the majority of principles, characteristic for the states with the developed democracy, defining the judicial organisation and judicial activity is fixed.



3. Model of economic development. The international rating of Switzerland

Economically Switzerland specialises on manufacture of hi-tech production and is known for the experts. Leading branches are microelectronics, biotechnological. The bank and insurance sector plays to a national economy the important role.

3.1 Import and export of goods

Switzerland - very small, densely occupied country. It is poor natural resources, and the total area of arable lands has not enough completely to satisfy requirement of the country for agricultural production. Owing to it, the national economy is appreciably focused on a foreign market. Switzerland imports, first of all, raw materials, half-finished products and consumer goods. Concerning small volume of its home market forces domestic manufacturers to leave on the European and international markets. To maintain a competition to foreign firms, they should be focused release of the high-quality goods as the small sizes of the country are limited by quantity of the made goods. So, importing rather cheap raw materials, the country specialises on manufacture of hi-tech production. (Compare: in 2005 Cost of 1 ton of the exported goods exceeded in 2,25 times cost of the same volume of imported raw materials). Export of goods In the world market the Swiss companies and firms possess high competitive capacity. Thanks to it more than 90 % of production are exported abroad, first of all hours, chocolate and cheese. However the major export deliveries are products of mechanical engineering, the electronic and chemical industry. On their share it is necessary about half of all export incomes of the country. Switzerland - the leading supplier of following production: weaving looms, a paper and presses, штамповочные cars for processing of metals, escalators and lifts, a packing material, railway gear rails. It is necessary to notice, that for today some from products are partially made abroad. Along with these "notable" deliveries by the important export spheres of economy of the state granting of consulting services, insurance and tourism are also. The important business partners of Switzerland - the EU countries. It supports the most intensive trade relations with Germany, France, Italy and the Great Britain. In 2000 60 % of total exports of Switzerland it was necessary to the EU countries while the general import of production has made 78 % of the same countries. The Trade and economic policy of Switzerland is directed on development of free trade, a word on reduction of the customs duties by the imported goods and by decrease in restrictions by import (except for agricultural production). Anyhow, within the limits of a bilateral agreement with the EU countries even these restrictions will be gradually removed.

3.2 The international rating

According to the report «Year-book of world competitiveness» (World Competitiveness Yearbook), published by International institute of problems of management (International Institute for Management Development - IMD) in May, 2005, Switzerland has risen on 8 place in comparison with 14th in 2004 rating Increase as marks IMD, was promoted by growing dynamism of the international sector of the Swiss economy. The USA has kept leadership in the list. In 2004 4 from 10 Swiss companies have entered into first five-ten annual rating of 500 largest world companies on capitalisation (Global 500), spent by the British business newspaper Financial Times. In other rating Financial Times published in 2001, Switzerland was in the lead in the list of the countries, development of sector of which high technologies looks the most perspective in the near future. The analysis has been made on the basis of economic and statistical data of the Organization of economic cooperation and development (ОЭСР). The similar result has caused some surprise as Switzerland is not the world leader in sphere of innovations and businesses though it is known for high level of a business life.

Source: IMD the Year-book of world competitiveness 2005

The Swiss firms abroad

As is known, export of goods plays the leading part in economy of Switzerland. For today every second earned franc arrives from abroad. At the same time more and more people abroad work at the Swiss enterprises. If in 1988 the total of the workers employed by the Swiss firms abroad, has made 890 thousand persons by 1998 it is number has increased twice (1,61 million). In Switzerland the considerable quantity of the foreign firms working in such branches, as chemical, machine-building, food, a pharmaceutical industry, a banking and insurance is concentrated. In the rating of globalisation made by experts of American magazine Foreign Policy, Switzerland has occupied 2 place among the most globalized countries of the world. At rating drawing up along with other factors the volume of international trade and the investments rendered by the Swiss firms abroad and foreign firms in Switzerland, and also a technological level (quantity of users of the Internet, number of Internet servers, etc.) was considered.



4. The population. Its well-being, incomes, structure

Switzerland totals about 7,5 million population from which 20 % have no Swiss citizenship. The quantity of aged people constantly grows, and the number of children and teenagers decreases.

Economic growth without creation of additional workplaces

In a consequence of that the economy cannot continue to grow beyond all bounds, for today the overall objective consists not in quantity, and as made production.

4.1 The Standard of well-being in numbers

Standard of well-being today

Reduction in price of a foodstuff was during the nineties marked and clothes so, for example, if in 1992 they made 16 % from expenses of the family budget in 1998 it is number has made only 12 %.

Expensive it is considered habitation: about 70 % of the population of Switzerland rents apartment or the house. In comparison with other European countries in Switzerland pay less taxes. Rather big sums it is paid on various kinds of insurance: on the average, about 4 % from the budget leaves on payment of insurance payments on obligatory medical insurance, the others of 5 % - on private forms of insurance.

The more properties, the are stronger desire to be insured. In comparison with last years it began to be spent more than means for entertainments and free pastime, formation and improvement of professional skill.

The riches are not advertised, about salaries do not speak

For Swisses conversations on the salary or a source of incomes are considered as the closed theme. Even close friends do not devote each other in these questions. This private affair of everyone, how many he earns, and it should not excite anybody. Switzerland is considered the rich country, and the majority of the population live обеспеченно. It is natural, that there are very rich people, but they will be not seen in streets. They modestly live and do not advertise the millions. On statistical data of 1997 on 3 % of the population of the country half of cumulative capital of all tax bearers of Switzerland was necessary approximately. However and in the environment of rich there are gradation. The richest make only 0,3 %, whose conditions together taken total 24 % from the cumulative capital. On other end of a scale of a rating are 30 % of the Swiss population which absolutely not do not have any condition. The list of 500 richest people of the world, made in 2005 the American magazine Forbes, included 8 representatives of Switzerland. Its condition is equaled 5,8 billion dollars. Switzerland involves rich foreigners. As informs Swiss magazine Bilanz, from ten richest inhabitants of Switzerland, five have foreign citizenship. Their general condition makes 103 billion francs (78 billion dollars). The most richest foreigner living in Switzerland, the head of the Swedish firm IKEA Ingvar Kamprad which condition is equaled 23 billion dollars is. It occupies also 6 place in the list of 500 richest people of the world of magazine Forbes.

4.2 Unemployment

Long time unemployment in Switzerland practically was absent (compare: its level was less than 1 %), not representing the reason for anxiety. Similar stability has been caused by following factors: - the Labour demand for a labour market has been counterbalanced with the offer; - the Policy of attraction of a foreign labour was spent taking into account changes of market condition of work, i.e. in days of economic lifting it was supposed more than foreign workers, than in recession; - In an economic crisis employers tried to keep workplaces with a view of avoidance of growth of unemployment. - in Switzerland problem branches (н-р, mountain and metallurgical) which are to the greatest degree subject to tactical fluctuations are presented in a small amount. Despite the factors set forth above in the beginning of 90th, in economy recession, the quantity of the unemployed began to increase quickly, having reached in February, 1997 of record-breaking high number - 5,7 %. Reorganisation of many enterprises and the establishments, caused reduction of the big number of workplaces became a recession consequence. Thanks to the general economic lifting noted in the late nineties, in 2001 it was possible to lower a rate of unemployment to 1,7 %. Unfortunately, this phase lasted not for long, and already by the end of 2004 the unemployment indicator has made about 4 %.

4.3 Birth rate decrease

Switzerland concerns the countries with a low natural increase. For last twenty with superfluous years the tendency of decrease in birth rate is observed. According to statistics of death rate and birth rate which is conducted since 1871, in the country for the first time in 1998 the death rate has exceeded birth rate level. According to the forecast, published in 2004, during the period with 2003 for 2012 decrease in number of children of school age (from 7 till 15 years) to 100 000 persons is expected. Since 1993 the number of citizens of Switzerland increases only at the expense of the foreigners who have received the Swiss citizenship.

The share of foreigners continues to increase in a population aggregate number.

4.4 Religion

The Christian church has lost many supporters last years. The interrogation of the population spent to 2000 has shown, that only for 16 % interrogated the religion is very important in a life. The family, work, sports and culture are the most important. The results of other sociological research published the same year, testify that for last 10 years the quantity of regular visitings of church from the Swiss population was reduced to 10 %. Among Catholics this number has made 38,5 %, among Protestants it has reached 50,7 %. Thus, Catholic and Protestant churches have lost as in a quantitative sense believers and in a percentage parity of the population. Nevertheless, 71 % interrogated continue to believe in God, in spite of the fact that they do not go to church. The requirement for church weddings and funeral, unfortunately, was strongly reduced for last 30 years.

On the other hand, the new religious currents formed from both two churches, in a proportional parity remained former: the church totals all the same 2,2. % from a population aggregate number, Catholic church - 0,2 %.

The quantity of parishioners in the Christian communities and sects as a whole has not changed. Owing to the big inflow of emigrants from the countries of the Near East and Yugoslavia Islam and Orthodoxy have received a wide circulation in Switzerland.

In the conclusion it is necessary to notice, that though the religion any more is not the important part of a life of Swisses, she has played a considerable role in formation of the Swiss state and mentality of its citizens.



5. The industry, agriculture, sphere of services

5.1 Firms and the enterprises

In Switzerland the small and average enterprises prevail. According to 2004 99 % from their general number totaled no more than 250 employees. About 88 % make the tiny firms numbering less of 10 employees. The biggest industrial company is Nestlй, the world's largest manufacturer of foodstuff. In the end of 2003 this concern totaled 253 thousand employees, 97 % from which worked abroad. The American magazine «Business Week» has published in 2004 the list 50 richest companies in the world, having selected them by one criterion - cumulative market cost of the action. 4 Swiss firms are included into their number, and pharmaceutical concern Novartis occupies 17 place in a rating. According to an annual rating of 500 largest companies of the world by criterion of market capitalisation (Global 500), spent by the British business newspaper Financial Times, in the end of 2004 Switzerland from it 11 firms took the sixth place among other countries of the world. Many Swiss enterprises, passing from father to son by right of succession, cope family clans. The Swiss businessmen long accused of their open display of liking левонастроенным to politicians. As is known, only limited number of the people as a whole numbering nearby 100 persons, is included into Council of board and makes own decisions, only occasionally listening to opinion of simple shareholders. With development of new technology and strengthening globalisation the companies began to recognise, that their managements should cause more trust, and mutual relations between them and workers to become more transparent.

5.2 Future manufacture

Specializing on a pharmaceutical industry and having the highly skilled faculty in higher educational institutions of the country, Switzerland has all preconditions in due course to develop manufacture of biotechnical, biological and medical production. The next 10-20 years in these areas of a science there will be the most important discoveries.

The national economy specialises not on mass production, and on highly technological production. Leading branches are: microelectronics, chemical, biotechnological, electrotechnical, hour and a pharmaceutical industry. In economy bank and insurance activity has great value. The majority of firms and the companies pursue so-called strategy of "niche" which consists in the adaptation to narrow segments of the wide market (niches) by specialised release of new or modernised production with unique characteristics. The chemical industry - a good example of introduction of this strategy: about 90 % of all chemical enterprises of the country let out highly specialised production. With a view of maintenance of higher competitiveness in the world market many Swiss firms invest money in scientifically-technological workings out.

5.3 The hour industry

Making 50 % from total amount of hour production in the world, Switzerland is one of recognised world leaders of the hour industry. In 2002 the average price of one hours exported from Switzerland, has made 362 francs (compare: in the world market the average price for exported hours made 223 francs). Here are issued both magnificent and expensive watch, and rather cheap firms Swatch accessible to everyone plastic hours. According to export data, Switzerland exports 95 % of hours made in the country.

5.4 Agriculture

In comparison with other West European countries in Switzerland - «to the country of peasants and cows» - farmers occupy the smallest percent from a population aggregate number. Besides, the Swiss farms on the area it is much less, than in other countries of Europe. So, for example, in 2000 The average farm totaled about 15,2 hectares of the earth (37,5 acres), and in mountains it hardly exceeded 7 hectares. Owners of small country economy have the big economic difficulties. To survive and support a family, they are frequently arranged for other additional work. The quantity of small farms is constantly reduced, while quantity of large-scale farms

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