Research Paper Help on Switzerland

Switzerland

Introduction

Switzerland is a federal sate in Europe that borders Austria, Germany, and Italy. The country has a population of about 7 million people with about 6 million of this population being Swiss citizens. The others are major immigrant population in the country to work, tour or study under international scholarship programs. The country is a multilingual state with about four national languages, which include German, French, Italian, and Raetoroman. Economically, the industrial sector imports most of the raw materials considering that Switzerland does not possess any raw materials of great importance (OECD, 2012). However, the country imports the raw materials and exports them to different countries, and this makes the country an economic giant in the European continent (OECD, 2012). Other sectors that help in the development of the country’s economy include agriculture, banking sector, local, and international trade. The country’s climate and geographical factors contribute to its ambience and this is considered important to the tourism industry, which is also one of the most important aspects in the development of the country’s economy (OECD, 2012).

The main objective of this paper is to assess marketing and marketing techniques that are applicable in Switzerland. An understanding of these techniques will provide reasonable explanation on different factors that affect the growth of the country’s economy and businesses. This will include a study on the country’s competitive environment, the economic environment that is considered in terms of its ability to attract and retain local and foreign investors. In addition, the study will also focus on the technological environment of the country and the role of technology in enhancing marketing initiatives of different business entities within the country’s economy (Hilty & Aebischer, 2014).

Q1. Social Environment

Meaning of the Swiss Flag

The Swiss national flag is a white cross on a red squared background. This is a generalization of the coat of arms of Schwyz one of three cantons who played a leading role in the battles, and was a founding member of the Swiss confederation in 1291. The red color in the flag is derived from a banner in the Holy Roman Empire hence a Christina meaning. Traditionally, the flag is represents trust, freedom, and honor (Hug & Kriesi, 2010).

Swiss population, growth rate

Switzerland is home to a population of 8.081 million people according to the latest populating statistics of the country. The country’s population growth rate is currently positioned at an estimated 0.78% as at 2014. This is as a result of surplus deficits of births over deaths and a balance in the population of immigrants coming in and leaving the country (Hug & Kriesi, 2010).

Meaning of colors and symbols in Switzerland

Colors in Switzerland also have meanings. Green and white are colors signifying revolution. Red is a symbol of confidence and beauty. Black in Switzerland means power and the ability of an individual to dress in black color is a symbol of their power of influence (Hug & Kriesi, 2010).  In terms of symbols, the court of arms and the national flag are the most important national symbols. They are driven by the motto of all for one and one for all, which requires everyone to be united towards a common course (Hug & Kriesi, 2010).  

Meaning of numbers in Switzerland

Numbers in Swiss culture derive meaning from the spiritual world. Number one, for instance, reflects new beginning while number two symbolizes the benefits of unity. Three is a time identifier considering that it is representative of the past, present, and future. Four represents stability while five means the unpredictable nature of life. Six is representative of the harmonious balance that nature provides. Seven represents the mysteries of life. Eight deals with success in business considering that it means continuation and cycles. Nine represents satisfaction with the successes in life. 

Meaning of Shapes in Switzerland

Shapes in Swiss culture also have meanings, for instance, circle means motion. The cross is a sacred symbol of honor. Spiral is a symbol of femininity while a square symbolizes masculinity. Triangle is a symbol of magic and creativity.

Structure and distribution of population by age, gender and income

The use of a population pyramid to illustrate the age and sex structure of Swiss population provides an insight on the political and social stability, including economic growth.

Figure 1.0: Population distribution

Special garments, food and beverages, celebrations and special occasions in Switzerland

Switzerland is characterized by the presence of a multicultural population. However, the most traditional Swiss clothing is characterized by embroidery, which is often stitched on hats, scarfs, and shirts. In terms of food and beverages, the country’s cuisine draws influences from France, Germany, and Italian cuisines. This means that the food varies from one region to another, and they include cheese fondue, raclette, and rosti. The beverages are largely tea but other drinks include wine, beer, and liquor. The country’s special occasion and celebrations include Christmas, which is considered important to Christians. Swiss national day, August 1st is celebrated in commemoration of the formation of the Swiss confederation in 1291 (Hug & Kriesi, 2010).

Art, folk shore, music and dances in Switzerland

Art and folk shore in Switzerland revolves around the mountainous landscape of the country. Another common form of artwork is chip carving, which is often used in the decoration of different objects, such as walking sticks and stools. In terms of music and dances, Switzerland is not commonly known as a musical country; however, a collective imagination of music in the country includes alphorn music, yodeling, and landler music. Switzerland is also home to celebrated songwriters from different regions, such as Ticino and choirs from western part of the country.

Religions, belief systems and superstitions in Switzerland

On the religious front and belief systems in the country, Christianity is the most dominant religious denomination in the country. There are also other religious groups such as Islam of the Sunni branch. It is important to note that the country has no official religion despite the fact that most of its laws have a relationship with Christianity.

197020002012
Roman Catholic46.742.338.2
Swiss Reformed48.833.926.9
Unaffiliated1.211.421.4
Other Christian2.04.35.7
Islam0.23.64.9
Jewish0.40.20.3
Others0.10.71.3
No answer0.43.61.3
Total (100%, older than 15)4.575.4165.868.5726.662.333

Table 1.0 Religion by denomination (% population older than 15%)

The Swiss are highly superstitious especially on matters regarding New Year celebrations. These include kissing at the stroke of midnight as a sign of warmth and affection, settling old and unpaid debts on the New Year’s Eve to bury the foregone debts and begin afresh. Black-eyed peas are also a symbol of good luck and when combined with cabbages they symbolize the possibility of acquiring more financial resources.

Family structures in Switzerland

Switzerland like most European countries has a nuclear family structure. Most of the men and women in this society get into the family systems at a later age and the father mother and at most two children often characterize the families. The spouses are considered as equal contributors in the family although the father is often the head of a household. Switzerland also experiences relatively high divorce rates.

Educational system and structure

The education system in Switzerland is considered as one of the best in the world. The cantons are responsible for the provision of educational services and the techniques of providing these services may vary from one canton to another. In terms of the education structure, the system begins with elementary school and upon graduation; a student joins secondary schools and later graduates to join the University for higher learning.

Q2. Political environment

Political system in Switzerland

Switzerland, which is popularly identified as the Swiss Confederation operates as a federal parliamentary republic, which is comprised of 26 cantons. This confederation was created as a way of ensuring tha the country’s political system is governed by direct democracy where power is devolved to the grassroots level. The political bodies of the country are the Federal Supreme Court of Switzerland, the Swiss Federal Council and two chambers of the legislative assembly, which include the Swiss Council of States and the National Council (Kresi & Trechsel, 2008).

The structures of government in Switzerland are in three levels. These include the federal levels, the cantonal level and the communal level. The country is considered to have a unique way of citizen participation in direct democracy considering that ordinary citizens have the constitutional right of proposing amendments to the constitution (Kresi & Trechsel, 2008).

Political parties in Switzerland and their view on MNCs

Switzerland is a multi-party democracy that allows tha active of engagement of citizens in different political aspects through formation and membership of political parties. The political parties in Switzerland include Social Democratic Party, Free Democratic Party and the Christian Democratic Party, which has its tenets on the Catholic religion (Kresi & Trechsel, 2008). 

            Switzerland is a state that lacks in numerous natural resources but it is also the best market for different products. Political parties have the responsibility of promoting business initiatives and creating a platform that attracts investors. Free Democratic Party and the Socal Democratic Party are considered as the most welcoming to MNCs since they consider these business entities as playing an essential role in the development of Swiss economy. The Christian democratic party is considered as the most conservative party in Switzerland. This is largely because of the belief that MNCs often come into the country for the exploitation of the available resources for their own benefits (Kresi & Trechsel, 2008).

Other influential political groups and organizations in Switzerland

ACT Responsible is one of the most influential non-governmental organizations in Switzerland. This is largely because its mandate revolves around the desire to protect the environment from all forms of pollution. While advocating for the interest of the public, the organization ensure that the MNC that are involved in industrialization adhere to the existing measures and standards that endeavor to protect the environment (Kresi & Trechsel, 2008). 

            Incomindios Switzerland is also an influential civil society groups whose mandate is to advocate for indigenous issues at the state and on the global platform. This organization has much of its focus on the North and South American countries. The influence of this organization lies in its ability to apply for Swiss Fund that are used in covering the expenses of delegates who attend conferences and meetings that endeavor to promote better governances (Kresi & Trechsel, 2008).

Q3. Legal environment

Commercial laws related to formation of companies, business taxes and other protection tools used

The establishment of public company or a private company in Switzerland, it is important that they abide by a popular legal structure as defined by the Swiss government. Any foreign company in Switzerland has the responsibility of abiding by the legal form through the establishment of a subsidiary. The incorporation of a limited company for instance is considered as an entity with a legal presence whose liabilities are entirely covered by the assets it possesses. The base capital for these corporations must be divided into shares that are distributed and owned by different individual in the public and private entities (Schanz & Schanz, 2010).

It is important to note that in Switzerland, the incorporation of companies as limited entities is not an ideal structure for the large organizations but it is also permitted for relatively smaller and medium sized business entities. The incorporation of limited entities is the most commonly used form for capitals and monetarist corporations (Schanz & Schanz, 2010).

In Switzerland the corporate tax rate is at 17.92% between 2006 and 2014, the corporate tax rate in the Swiss country was averaged 19.01% and this reached an average high of 21.23% in 2006 and a record low 17.92% in the year 2014. The Swiss Federal Tax Administration has the responsibility of reporting on the matters relating to Corporate Tax Rate (Schanz & Schanz, 2010).

Figure 2.0: Switzerland Corporate Tax Rate

The corporate income tax rate in Switzerland amounts the tax collected for different companies in the country. This amount is calculated on the basis of the net income that businesses obtain in the process of carrying out their business activities. Revenues that are collected from corporate tax rates form an important source of income to the Swiss government (Schanz & Schanz, 2010).

Q4. Competitive environment

According to the 2013 report by the World Economic Forum (WEF), Switzerland is considered as the most competitive country. This was largely based on the country’s innovation levels and the labor market, which were considered as some of the strengths that made the country develop an environment that encourages healthy competition among different businesses. The competitive nature of Switzerland is also based on the quality of its research institutions, which emphasize on effective collaboration between the academic sector and the business sector. In addition, the rate of products patenting also contributes to the ability of the country’s economy to be the most competitive in the world (Hilty & Aebischer, 2014).

Other than collaborative efforts, Switzerland’s competitive environment is also enhanced by the training and education platforms within different sectors of the economy. Such initiatives create provide an equal platform for those engaging in different market initiatives. In addition, it also provides opportunities for wealth and job creation, which are fundamental to the development of the country’s economy (Hilty & Aebischer, 2014). The strong co-relation between employee training and employee needs is an indication of the levels of transparency and accountability in supporting business confidence in probable and existing investors while at the same time supporting the country’s economic output. Despite the highly competitive environment in Switzerland, the country still faces challenges in regard to university enrollment compared to other countries in the economic platform (Hilty & Aebischer, 2014). This explains the reason for an increase in the population of immigrant workers into the country. These workers are often outsourced with the intention of bridging the gap in shortage areas. In addition, the country is currently initiating strategies and developing structures that will ensure that it boosts enrollment levels in it universities as a way of not only maintaining but also improving on its competitive levels (Hilty & Aebischer, 2014).

Type of competition

The market in Switzerland operates on pure competition. This means that the market is characterized by low barriers to entry, availability of numerous business opportunities and the absence of a single dominant body in any industry. This means that there are many companies in the country that are operating on an equal platform and that there is no entity that enjoys a significant advantage over other businesses. The Swiss government has been instrumental in advocating and instituting structures that are necessary in the development of pure competition (Hilty & Aebischer, 2014). The Swiss Competition Commission (ComCo) through its secretariat has been charged with the mandate of regulating and promoting competition in Switzerland to ensure the existence of pure competition. It is important to note that this has been realized by maintain focus of key themes, which include market foreclosure and hard-core cartels (Hilty & Aebischer, 2014).

            ComCo believes that one way of preventing market foreclosures and maintaining high lees of pure competition through the opening of internal markets for notarial services, investigation on restraints on parallel important and introducing a system of watch markets considering its essence in the promotion of competition on the international platform. The prevention of market for closures is considered by ComCo is considered as a special feature considering its essence in ensuring that there is limited or no abuse by a dominant business entity(Hilty & Aebischer, 2014). In addition, through such preventive measures the Swiss government ensures that there are sufficient regulations such that no instances of dominance are reported. It is important to note that the Cartel Act for instance was used as a preventive measure essential in minimizing the harmful economic or social effects that are considered as restraints of pure competition. In addition, the Act was also a technique to ensure the promotion of competition in the interests of the liberal market in Switzerland (Hilty&Aebischer, 2014).

            The fight against hard-core cartels in the market has been characterized by investigation of sensitive areas that could limit pure competition such as bid rigging. This was evidenced in the decision by ComCo in 2013 to commence an investigation into bid rigging scandal that characterized the road construction industry (Hilty&Aebischer, 2014). In addition, addition, ComCo has also been instrumental in the investigation of numerous local and international businesses within the country by conducting numerous assessments in trade agreements and their influence on the competitive environment of the country (Hilty & Aebischer, 2014). This was as evidenced in the March 2014 probe by the Swiss competition authorities concerning the alleged manipulation of foreign exchange rates against different investment banks within the country. These investigative bodies have been involved in numerous investigative procedures as ways of ensuring fair and pure competition in Swiss markets (Hilty & Aebischer, 2014).

Degree of competition in the marketplace

Different factors play the role of determining the degree of competition in Swiss market. They include product and service differentiation, cost of start-ups, the number of competitors in the market and government regulations (OECD, 2012). Differentiation of products and services in the Swiss market is considered a special determinant in the degrees of competition since it is often used as a marketing strategy buy different firms to gain some level of competitive advantage. This is considered as an attempt of making a product or service provision unique in terms of quality, quantity and the price of the product. In the Swiss market there are different firms especially those in the manufacturing industry that apply the use of product as a way of ensuring that there is a substantive differences between a specific product or service in relation to the existing alternatives(OECD, 2012).

Cost of start-ups is also definitive of the degree of competition in any market in Switzerland; it is relatively cheaper to initiate a business in the country. This is largely because the country enjoys stable modern economy and it is one of the most capitalistic economies on the international platform. Its capitalistic nature allows it to be welcoming to any individual who is interested in setting up a business within the country (Hilty & Aebischer, 2014). It is also important to note that the country has relatively high levels of competition and this explains why it is possible to establish a company in the form of a limited liability company without the need of acquiring a license to do business in the country (Hilty & Aebischer, 2014). Licenses are however considered a necessity when an individual is interested in starting up a business that is subject to licensing requirements such as those in the mining and agriculture industries that are largely controlled by the government to minimize over exploitation (Hilty & Aebischer, 2014).

Number of competing firms is also considered as an essential determinant of the degree of competition in any country. It is important to note that the relative unavailability of essential raw material in the country is an indication that the country is mostly dependent on importation of these materials (Hilty & Aebischer, 2014). The country has a relatively small domestic market and this means that most businesses are focused on the maintenance of a very high export rate. This has made the economy more dependent on the foreign market as a technique of ensuring high levels of investment returns. This means that most of the firms in Switzerland are export films and this is considered as a highly competitive sector (Hilty & Aebischer, 2014). Other than the agriculture sector that is heavily regulated by government operations, other sectors are the construction and manufacturing sectors that attract both domestic and international investors. Switzerland is also considered as the country with the lowest taxation rates among developed countries and this explains the presence of numerous competing firms in different entities of the country’s economy (Hilty & Aebischer, 2014).

Government regulations determine the degree of competition in Switzerland sine it is through such regulations that the government is able to notify potential and actual investors of the requirements that every investor must fulfill prior to and after investing in the country (OECD, 2012). Inasmuch as the Swiss government may have developed general requirements that regulate conditions in the market, it is also important to note that the government also defines regulations that are specific to investing in different sectors. For instance, in Switzerland, the agricultural sector is considered as a highly restricted sector (OECD, 2012). This is largely because in Switzerland, a small percentage of land is arable and any agricultural investment must therefore be directed towards serving the agricultural needs of the country’s citizens. Switzerland has virtually no or limited amounts of raw materials. This means that the country heavily relies on the importation of raw materials for its industries (OECD, 2012). Despite this tendency, it is important to note that the government has instituted low import duties and a few important quotas. This is a strategy aimed at encouraging different investors to engage in import business and acquire more raw materials for the country. There are also regulations that are aimed at ensuring that importation is directed toward the most essential raw materials to minimize the possibility of dumping of surplus raw materials from different countries (OECD, 2012).

Q5. Economic environment

Gross Domestic Product (GDP)

            GDP measures national income in relation to the output of a country’s economy. GDP is therefore considered to be equal to the total expenditure that a country incurs in the production of different goods and services within a defined period and the returns that the country acquires from the sale of different products and services through the ventures of local and international companies that operate within the country and in other countries (OECD, 2012). The differences between the income and expenditure of a country will determine the country’s GDP. GDP is definitive of any country’s potential or actual growth rate. Switzerland’s economy has over the years been experiencing expansion in different sectors considering its export culture. It is important to note that an increase in the country’s export rate has been helping the country’s economic growth compared to that of the neighboring countries such as Germany (OECD, 2012). In 2013, for instance the GDP of Switzerland rose by about 0.5% between September and December (Hilty & Aebischer, 2014). This made the country’s GDP to stands at $ 650.70 billion in 20013. This is considered as a representation of about 1.05% of the global economy. Between 1960and 2013, the country has been experiencing an average of $205.16 billion and this was facilitated when the country hit its highest GDP in 2011 which was at $658.87 billion and a record low of $9.60 billion in 1960 (Hilty & Aebischer, 2014).

Gross National Product (GNP)

            Gross National Product refers to the total value of all the final products and services that are produced within a country in a specific year. This is also inclusive of the income that the citizens of the said country earn. This means that GNP provides a platform of measuring the values of goods and services produced within a country by its citizens irrespective of their location within the country and on the international platform (Hilty & Aebischer, 2014). This measure is often considered under the assumption that a higher measure of GNP is an indication of higher life standards. In Switzerland GNP also comprises of income from domestic unit such as households, enterprises and the government. GNP of Switzerland rose to$ 652.6 billion. This was an increase by $628.6 billion from the $662.1 billion in 1970.   The country’s GNP is ranked 6th in the world (Hilty & Aebischer, 2014).

Distribution of income in Switzerland

            Switzerland enjoys a liberal market, which plays a decisive role in the definition of the distribution of income in the country. The country has a high flexibility in the setting of wages and the in the employment law (OECD, 2012). It is important to note that h the decision on the distribution of income is also influenced by the apprenticeship system, which is definitive of the social integrative function of the liberal market. The apprenticeship system ensures that the wages of fulltime employees are equally distributed. The country’s level of employment stand at 83% and unemployment level is at 3% (Hilty & Aebischer, 2014). This is an indication that the distribution of income in Switzerland which is inclusive of income from ages and financial investments is relatively balanced compared to that of the other countries within Europe and in the international system(Hilty & Aebischer, 2014). It is however important to note that the labor market in Switzerland often favors the highly qualified while middle-income earners comprise those who have for years maintained their position in the income distribution table. This is largely because of an influx in the population of women in the labor market. This has also resulted into differences in disposable household income especially in primary income after tax, the payment of social security and transfer has not widened (Hilty & Aebischer, 2014).

Major imports

            According to the reports on Switzerland imports in 2011, the imports stood at an annual expenditure of $12.9 billion. The country’ imports include machinery, chemicals, metals, agricultural products and textile (OECD, 2012). The country’s imports are largely raw materials since Switzerland lack in the availability of raw materials that are necessary to boost the country’s ability to effectively industrialize (OECD, 2012). Most of these imports are also procured based on agreements between Switzerland and the country exporting raw materials. Such agreements are definitive of the limits of the country in selling and processing different products (OECD, 2012).

Major exports

            In the export market, Switzerland is globally acknowledged as the country in charge of exporting chocolates and watches. In addition, the country is also dealing in the exportation of chemicals, electrical equipment and apparatus, and mechanical engineering products (OECD, 2012).

Balance of payment of payment status over the last five years

            Balance of payment is considered as a technique that different countries employ in monitoring al international monetary transactions within a specific period of time. This is often calculating annually or quarterly depending on the existing system. Through balance of payment, a country is often able to assess all trades that are conducted by the public and private sector as a way of determining the amount of money going out of the country and that, which is retained in the country (Hilty & Aebischer, 2014).

Figure 3.0 Swiss balance of payment

Switzerland’s government budget position

            Since 2010, the Swiss government introduced the debt break extension whose application was on the focus of compensating for extraordinary expenditure. This means that the government was to exempt the undue use of the clause limiting the possibility of using the debt brake extension. The Swiss government in its budget has a fiscal position, which is often accompanied by limited need for fiscal consolidation in the short term (Hilty & Aebischer, 2014). These requirements are considered possible through structurally balanced budgets by the government at the federal level. This includes consolidation efforts of 0.3% of GDP as part of the plan in the period of 2011- 2013(Hilty & Aebischer, 2014). Through it, budgets the government expects majority of its savings to come from spending restraints and this would result in the stabilization of the federal government expenditure relative to the Gross Domestic Product. This is considered as a technique of realizing a lasting consolidation effort. Budget deficits in the view of the Swiss government should not exceed 1% of the country’s GDP in the coming years considering that it is expected that the fiscal budget will be restored within the forecast horizon (Hilty & Aebischer, 2014). The government has an expectation that its Gross debt will reduce by about 20% of the country’s GDP. It is important to note that the adjustment of the country’s budget ceiling is expected to lower the inflation levels while at the same time reducing the debt servicing cost. These are considered as techniques that will provide effective consolidation (Hilty & Aebischer, 2014).

Research and development

            In terms of scientific research and development Switzerland is considered as one of the countries with the best scientific research institutions according to the world rankings. This is because of the existence of strong collaborative efforts between academic institutions and business organizations, which have sufficient budget allocations for research and development (Hilty & Aebischer, 2014). It is important to note that much of the research initiatives are often translated into marketable products and the reinforcement of strong intellectual property protection by the Swiss government and other relevant institutions (Hilty & Aebischer, 2014). In addition, the high standards that Switzerland demonstrated in research and development ids reinforced by the ability of the country to promote robust innovation among its population within the existing infrastructure. This is often encouraged by the high rate of patenting per capita considering that the country is ranked second on the global platform (Hilty & Aebischer, 2014). Effective research and development in the country has been heightened by the ability of the country to put in place excellent techniques that can be used in improving various sectors of the economy and academic institutions (Hilty & Aebischer, 2014).

National spending

            Switzerland is considered as the only European country whose expenditure on national matters is below 20% of the national GDP. The ability of the country to spend about 19% of its GDP on national matters is an indication of the high standards of living and high technological developments, which give better ad high returns, compared to the amount of financial resources that the country spends in their acquisition, installation and implementation (Hilty & Aebischer, 2014).

Figure 3.0 Total and Social Public Spending in US, Switzerland and Sweden

Average income

Average income in Switzerland is dependent on numerous aspects, which include the occupation and the level of expertise. It is important to note that such considerations are important in ensuring that individual earn according to their levels of professionalism and the kind of work that they perform (OECD, 2012).

Job CategoryAverage Salary
Cleaning and Housekeeping2,792 CHF
Law Enforcement / Security / Fire3,083 CHF
Food /Hospitality / Tourism / Catering3,546 CHF
Electrical and Electronics Trades4,550 CHF
Health and Medical5,358 CHF
Real Estate6,000 CHF
Facilities / Maintenance / Repair6,000 CHF
Import and Export6,167 CHF
Courier / Delivery / Transport / Drivers6,249 CHF
Fashion and Apparel6,250 CHF
Media / Broadcasting / Arts / Entertainment6,264 CHF
Advertising / Graphic Design / Event Management6,289 CHF
Customer Service and Call Center6,344 CHF
Construction / Building / Installation6,433 CHF
Administration / Reception / Secretarial6,470 CHF
Architecture6,610 CHF
Factory and Manufacturing6,805 CHF
Engineering6,990 CHF
Telecommunication7,556 CHF
Airlines / Aviation / Aerospace / Defense7,750 CHF
Public Relations8,107 CHF
Science and Technical Services8,109 CHF
Teaching / Education8,131 CHF
Sales Retail and Wholesale8,427 CHF
Marketing8,485 CHF
Environmental8,729 CHF
Fitness / Hair / Beauty8,833 CHF
Information Technology8,905 CHF
Accounting and Finance9,160 CHF
Pharmaceutical and Biotechnology9,683 CHF
Insurance9,689 CHF
Business Planning9,727 CHF
Banking9,826 CHF
Quality Control and Compliance10,179 CHF
Human Resources10,980 CHF
Purchasing and Inventory11,368 CHF
Oil / Gas / Energy / Mining11,583 CHF
Executive and Management14,491 CHF
Legal14,736 CHF
Automotive27,000 CHF

Price indexes

Index
Consumer Price Index (Excl.Rent)131.90
Rent Index59.59
Groceries Index133.54
Restaurant index136.78
Consumer price Plus rent index96.63
Local Purchasing power145.45

Inflation rate

            The inflation rate in Syria according to recent studies was recorded at 0% as at October 2014. Between 1953 and 2014, the average inflation rate of the country is art 2.57%. This was facilitated by a high inflation rate of 11.92% in 1973 and a low of -1.37% in 1959. These studies were conducted by the Swiss federal statistics Office (Hilty&Aebischer, 2014).

Figure 4.0 Switzerland inflation rate

Taxations

            There are differ types and levels of taxation in Switzerland. Despite of the presence of numerous taxation methodologies levied by the Swiss Confederation, the canton and the municipalities, Switzerland has a relatively low taxation rate and this explains the presence of various tax exemptions and low taxation levels on Swiss companies involved in businesses abroad(OECD, 2012). Federal taxes are direct taxes levied on the income of private individuals. There are also cantonal taxes which allow the cantons to decide on their tax systems and rates. There are communal taxes, which are regulated by the cantonal tax regulation Act. This legislation however permits communes to set individual tax rates (Hilty & Aebischer, 2014).

Stage of the business cycle

            Switzerland is at the peak stage of the business cycle this is because the country enjoys relative stability in terms of politics and international association especially with the European Union. The ability of the country to negotiate as a single independent state on business tariffs is an indication that the country is an important player in international economics despite its small size and the small local market that the company operates (OECD, 2012). In addition, the country is considered to be lacking in raw materials. However, it is a leading exporter of most processed commodities in food and engineering sectors. The country’s GDP is relatively high and the national expenditure stands at 20% of its GDP. This is an indication that the country’s economy is operating efficiently (Hilty & Aebischer, 2014).

Figure 5.0 stages in a business cycle

Technological environment

State of technology in Switzerland

            Switzerland is considered a high-tech country on the international platform considering the country’s ability to acquire different aspects of technology and allocate more financial resources to research and development especially on innovative matters related to technological enhancement of the country (OECD, 2012). Numerous operations in Switzerland are computerized and this has improved the country’s productivity and efficiency. Technological innovation in Switzerland explains the development of Swissnex, a network developed in Switzerland that promotes science, education and art (OECD, 2012). The country is also one of the leading states in exportation of technology to different locations and this explains why the Swissnex is currently operational in about five locations around the world. Its success in automation of services related to science, education and art is an indication that technological level of Switzerland is relatively higher compared to those in other developed countries around the world (OECD, 2012). Students from technologically able countries such as the US have been able to travel to Switzerland to acquire knowledge and skills on matters related to the development of a state of the art technology that integrates different systems related to science, art and education (OECD, 2012).

People technological knowhow level

            Other than the ability of the Swiss to develop Swissnex as a methodology demonstration their technological knowhow, the country’s ability to integrate technology in different industries within the economy is an indication that technological literacy in Switzerland is are relatively higher level (Hilty & Aebischer, 2014). It is important to note that the Swiss government by financing research and development puts much focus on production of high quality technology this explains why the most essential export areas to Switzerland are micro-technology and biotechnology among other technologically related products and services (OECD, 2012).

Communication capabilities and the country’s infrastructure

            Switzerland’s communication and transport infrastructure is characterized by a relatively dense rail network. In addition, the country as a large and state of the art road networks which numerous tunnels that compensate the mountainous terrain characterize. It is important to note that the country’s transport infrastructure is reinforced by the presence of two large airports in Zurich and Geneva which are supported by a few smaller airports that also length country to the international world. Despite its landlocked nature, the country has a marine system, which operates abroad. It is important to note that Switzerland is strategically located on the crossroads that connect some of the fastest growing economies in the European Union such as France, Germany and Italy. The country’s infrastructure is also supported lager resources for the production of hydroelectric energy. The power generated from the Alpine rivers supply about 55 billion Kilowatt-hours. The energy sector is also reinforced by the availability of about five nuclear power plants, which supplement the hydroelectric power plants (OECD, 2012).

            The country also has a fully liberalized communication market. The market is relatively competitive considering the existence of numerous private companies is in charge of the telecommunication sector. These include Diaz and Sunrise. The presence of rival operators has led to the reduction of call rates both locally and internationally. Other than the telecom market, mobile phone operators such as Vodafone, Tele Denmark and Swisscom among others also flood the communication sector. The high-level competition in the communication sector prompted Swiss companies to produce telecom card to facilitate communication among Swiss scribers (Escalona, 2014).

Transportation modes and availability

            The local transport network in Switzerland comprises of three principles that are definitive of transportation modes and they include road, rail and air. The modes of transport are readily available for local and international travelers in the country or those interested in travelling into the country from other regions. The air mode of transport is operated by Swiss Airways. Domestic air travel is fast efficient but also expensive.

            The rail transport in Switzerland is considered as one of the most developed in the world. The most outstanding feature of this mode of transport is that it is relatively cheap compared to air transport and it is relatively fast compared to road transport. In addition, rail transport also provides a platform of local tourism especially for those interested in viewing the scenery.

            Road transport is also well developed in Switzerland. The country is relatively mountainous and this explains why many roads on mountains are narrow. One can use a bus or personal car. There are however traffic regulations and speed limits that regulate movement.

Advertising agencies and the media

            Technological innovations and high levels of technological knowhow in the county have attracted more businesses into Switzerland. Most of these businesses are directed towards the realization of better competitive advantages; this has created need for the development of advertising agencies in different sectors of the economy. These agencies are in charge of the development of brands and building of these brands in relation to public image (Escalona, 2014). Advertising agencies in Switzerland are however bound by the code of conduct, which define and limit their levels of advertisement in relation to public decency and that which is morally acceptable in the society. Advertising agencies in Switzerland include Advico Young and Rubicam AG, Alicom productions AG and tracknet holding among other advertising agencies (Escalona, 2014).

            The Swiss media is relatively liberal considering that the freedom of the media is entrenched in Switzerland constitution. The country operates government owned media, which are the Swiss radio broadcasting Corporation and the national television broadcaster. The country also has private broadcasters that have been considered as failures in their inability to establish themselves at the national level (Escalona, 2014). The print media is one of the most dominant forms of media in Switzerland. The national daily Neue Zürcher Zeitung (NZZ) for instance enjoys a positive reputation due to its role in providing the necessary information to Swiss citizens (Escalona, 2014).

Conclusion

            Switzerland is one of the developed countries in the world that is ranked high in different aspects such as research and development, high living standards, high export rate, low inflation rates among other factors. This largely attributed to the strategic position of the country in Europe, which has enabled it to share borders with highly developed countries such as France, Germany and Italy. In addition, the country also has a relatively small population, which makes it relatively easier to ensure effective management and proper allocation of resources. The country’s infrastructure is highly developed enabling easier transportation and communication techniques.

References

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Hilty, L., & Aebischer, B. (2014). ICT innovations for sustainability.

Hug, S., & Kriesi, H. (2010). Value Change in Switzerland. Lexington Books

Kresi, H., & Trechsel, A. (2008). The Politics of Switzerland: Continuity and Change in a

            Consensus Democracy. Cambridge University Press

Organisation for Economic Co-operation and Development. (2012). Switzerland 2012. Paris:

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Schanz, D., & Schanz, S. (2010). Business Taxation and Financial Decision. Springer Science &

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