Switzerland

With a broad set of strengths, Switzerland falls into the top ranks internationally (rank 3) with regard to economic policy. Its score on this measure has declined by 0.3 points since 2014.

The country experienced a significant decline in GDP in mid-2020, with the tourist sector feeling a particular pinch. Growth returned late in the year, and fluctuated in 2021. The economy has a dual structure, with a highly competitive and innovative export industry paired with relatively sheltered domestic industries.

The unemployment rate is very low, reaching 3% in 2021. Foreigners comprise 27% of the workforce. Employment rates are very high among men and women, though about 44% of employed women work part time. Tax rates are moderate but generate sufficient public revenue. A CO2 emissions tax was voted down by the public in a 2021 referendum.

Budgets are generally prudent. Debt rose to nearly 43% of GDP in 2021. A key issue is the unresolved trade relationship with the EU, following Switzerland’s rejection of a framework agreement updating bilateral trade treaties. Switzerland has been excluded from a key European research network as a result, hampering the country’s otherwise strong R&D system.

Despite some gaps, generally successful outcomes give Switzerland’s social policies a good overall ranking (rank 9) in international comparison. Its score on this measure is unchanged relative to its 2014 level.

The quality of the education system is high, but students of low social status are less likely to go on to higher education. Vocational training is very solid, contributing to low employment rates among young people. While social assistance policies are effective, poverty rates are on the rise. Gender inequality remains a significant issue.

Healthcare quality and inclusiveness is excellent, but the system is very expensive. The pandemic exposed a shortage of personnel in the system. Policies helping women to reconcile work and family are weak in international comparison. Family benefit spending is low, and childcare facilities are very limited. Pension levels are generally high, but repeated efforts to reform the system have failed.

Integration policy varies by canton, but has not been broadly successful. Naturalization can be very difficult. An anti-foreigner right-wing populist grouping is the strongest political party. Crime rates are low. Development cooperation has become somewhat controversial, with the right-wing party calling for cuts.

Despite recent hurdles in developing an acceptable emissions reduction policy, Switzerland falls into the top ranks internationally (rank 6) with regard to environmental policy. Its score on this measure has declined by 0.3 points relative to its 2014 level.

The country has committed to reducing greenhouse gas emissions by 50% relative to 1990 levels by 2030, including international credits. The actual domestic reduction is to be 30%. The objective of net zero emissions (including credits) is planned for 2050.

A planned CO2 reduction program that involved levies and subsidies was voted down by the public in a referendum in 2021. A much less ambitious replacement has been drafted. Control of water pollution and waste management are particular strengths. The country’s public expenditure on environmental protection is substantially higher than the OECD average.

Biodiversity is a problem area, as the country has Europe’s lowest share of conservation areas set aside for this purpose. Pesticide use on a per capita basis is high, despite the rather small agricultural sector.

With its vigorous public referendum system, Switzerland scores in the top ranks (rank 6) with regard to the quality of democracy. Its score on this measure has improved by 0.1 point relative to its 2014 level.

Voting rights are robust, but exclude the very large foreign-citizen population. A new law substantially increases scrutiny of political candidate and party financing, and enhances monitoring mechanisms. Journalists can be subject to prison sentences for using information that violates bank secrecy regulations; thus, Swiss journalists have not participated in recent financial-whistleblower stories.

Direct-democratic procedures are widely used, with results sometimes conflicting with human-rights or treaty obligations. A number of recent referendums have specifically targeted Muslims. An anti-terror law allows federal police to engage in “preventive measures” to prevent terrorist action. The law is opposed by human rights and civil liberties groups.

Civil rights are generally well protected, but tension between EU norms and Swiss sovereignty has emerged. A major political party engages in xenophobic and Islamophobic discourse, and gender discrimination in the labor market remains problematic. Corruption is rare, though tight informal networks between elites do produce occasional scandals.

Reflecting a collegial, decentralized political system, Switzerland receives high overall rankings (rank 9) with regard to executive capacity. Its score on this measure has declined by 0.1 point relative to its 2014 level.

Compared with other advanced democracies, strategic planning in Switzerland is underdeveloped. As there is no prime minister, the seven members of the Federal Council act collegially. Interministerial planning is centered in the Chancellery. Coordination and consensus have become more difficult as government parties have become more polarized, thus shifting initiative to individual line ministries.

New regulations are subject to a “quick check” RIA procedure, followed by deeper review if the issue demands. Policymaking is strongly based on public consultation with interest groups. Most tax revenue is raised by highly autonomous local administrations. Cantonal autonomy ensures significant variation in standards.

Cantonal implementation of regulations is pragmatic, and is often tailored to the concerns of powerful local interests. International coordination has been problematic, as it is seen as infringing sovereignty. An inability to resolve tensions over the vital relationship with the EU has highlighted inflexibilities with regard to domestic adaptability.

With an increasingly professional national legislature, Switzerland scores well in international comparison (rank 10) with regard to executive accountability. Its score on this measure has improved by 0.9 points relative to its 2014 level.

Swiss citizens are reasonably well informed about policies and referendum proposals. Many citizens overestimate the country’s leverage vis-à-vis the EU when voting in referendums, leading to political and diplomatic difficulties. Media policy coverage is generally of high quality.

Parliamentarians have strong formal oversight powers, but comparatively few resources. A diminishing share of legislators have other jobs, a trend that is allowing the parliament to become more professional. There is no national-level ombudsman, but the Audit Office is independent. Federal data-protection policy has been updated to align with the EU’s General Data Protection Regulation.

Political parties are somewhat oligarchic, but membership rates are declining. Economic organizations are pragmatic and sophisticated, often more so than parties, while the character and influence of other interest groups varies widely.