25 june 2015 | Peter Buomberger, Gerhard Schwarz and Simone Hofer Frei
It is mainly companies that are being challenged by the strong franc. But Swiss economic policy must now also confront the task of taking up long overdue – and familiar – improvements to Switzerland’s attractiveness as an investment centre. The latest “avenir special” sums up its findings in 10 propositions.
Elderly workers are losing their jobs less often than in the past. But they are having to look longer for new positions. Special job protection rules are counter-productive, as they make hiring older workers harder, not easier.
Whatever the background, fancy or real and pragmatic, Switzerland is an inspiration, writes Krassen Stanchev, founder of IME, Bulgaria’s first independent and free market think thank. While reform propaganda notoriously draws on the Swiss model, politicians in his country have only recently begun to try and replicate it with more boldness and less folklore.
Carlo Lottieri, professor of political philosophy at the University of Siena, Italy, and at the University of Lugano, explains the roots of the successful model of Swiss federalism: a protestant theology decoupled from the notion of the sovereign state, going back to Heinrich Bullinger, and the tradition of the commons, which translates into a federalism of owners.
From a Swiss point of view, it must be hard to imagine how fascinating, thrilling and attractive the small-scale political structure of the country appears from the outside – and that foreigners looking at Switzerland may find the workings of Swiss cantons and councils interesting or even inspiring.
The Swiss National Bank’s decision to abandon its exchange rate floor for the euro against the franc came as an almost universal shock. All agree the move will have wide ranging consequences. But it now offers a chance, as well as a challenge, to regain competitiveness though smart and courageous economic policy reforms to address the impact of the stronger currency.
At a breakfast event in Zürich, Laurence Kotlikoff, the US academic economist, pleaded for the urgency of fundamental tax reforms. Alongside far reaching changes to the pension system – essentially to allow a greater role for individual old age cover – his “Purple Tax Plan” for the US envisages moving to broader levies on consumption.
“There is no future without a past.” True to those words, Avenir Suisse’s 2015 “Annual Dinner” for sponsors was held at the Trafohalle in Baden – the former high voltage laboratory of ABB. In this location three top class guests discussed Switzerland’s energy future: Federal Councillor Doris Leuthard, head of the Federal Department of the Environment, Transport, Energy and Communications, Dr Johannes Teyssen, Chief Executive Officer of E.ON, and Dr Matthias Bichsel, who for more than 30 years held leading roles at Royal Dutch Shell.