Switzerland, the world’s 20th largest economy, is a small country but very developed one. Even though it has a similar population size as Israel (8.5 million people), the Swiss economy is about twice the size of Israel’s economy. In a country that speaks four different languages; German, French, Italian and Romansh it is surprising that all citizens are able to understand each other quite well. Even more surprisingly, despite internal and external economic changes throughout Europe, Swiss per capita GDP remains among the highest in the world at around $78,000 in 2016. The most powerful economic sector in Switzerland is the services sector, which employs 73% of the workforce (mainly in financial services). Switzerland, together with Iceland, Norway and Liechtenstein, is part of the EFTA Trade Group, which has a free trade agreement with Israel since 1992.
The Geneva-based commercial attaché has two main types of activities that are significantly different from each other:
1) Representation of Israel in the World Trade Organization (WTO).
2) Promoting trade and investment between Israel and Switzerland.
The first domain belongs to the so-called “Trade Policy”. The World Trade Organization deals with agriculture, customs, trade barriers, import licenses, balance of payments, access to markets, services, dumping, settlement of trade disputes and more. For each of these, there are regular committee meetings, which are held several times a year. Some of the objectives of these meetings are to enforce existing agreements and discuss complaints between states regarding fulfillment of these obligations. These mechanisms are relevant to Israeli companies facing problems when exporting to a country Member of the WTO.
In addition, there are constant negotiations to conclude new trade agreements between the existing 164 WTO member countries. These new agreements relate to many aspects of trade, some of which deal with tariff reductions. Part of our role includes holding consultations with representatives of Israeli industries in order to determine and represent its defensive and offensive interests. However, concluding new agreements is becoming more challenging, due mainly to a shift in the global balance of power in the global economy and the rise of China and India as economic powers. In this context, it is worth taking note that Israel and Switzerland cooperate closely on many maters at the World Trade Organization, some of them include our similar interests when protecting our agriculture sector.
In the second field “Export Promotion” we are experiencing an awakening in relations between the two countries.
Consistently and over the years, the unemployment rate in Switzerland stands at about 3.5% (close to what is called structural unemployment). As a result of the Fourth Industrial Revolution, the government realized that there is a significant concern that unemployment will increase in the next few years, and as a preemptive measure, the government is looking to variety of activities to support innovation and diversification of export sources. Today, there are dozens of initiatives to promote innovation, such as: Mass Challenge opened a branch in Switzerland and a federal government-sponsored organization called Digital Switzerland to name a few. These initiatives, together with dozens of Swiss companies, have developed a fertile innovation eco-system across Switzerland.
In addition, in order to ensure Switzerland’s competitiveness in the European Union, many European regulations in various fields have been almost fully adopted by Switzerland, allowing for a seamless import/export of goods between the two (almost half of the goods and services from Switzerland go to the Union). Some of the strongest sectors in Switzerland include: banking, insurance and tourism; and some of the companies representing some of these sectors in Switzerland include: Nestlé, Roche, Novartis, ABB, UBS, Credit Swiss, Swatch, Swisscom and Syngenta.
In May 2016 we held a Fintech and Cyber event in Zurich (with our partner UBS Bank) in which we presented and introduced 15 Israeli companies to many financial institutions in Switzerland. In June 2017, an innovation expert from the large retail bank in Switzerland, Raiffeisen participated in the Global Fintech Opportunities event in Tel Aviv.
At the beginning of September 2017, the Swiss Minister of Finance visited Israel and signed a Memorandum of Understanding (MOU) with the Israeli Minister of Finance and Ministry of Cooperation, mainly in Fintech between the two countries.
Later, at the end of October, a delegation of about 50 people, headed by the Swiss Minister of Economy, visited Israel. The Swiss noted that this is one of the largest delegations that has emerged in recent years, and included politicians at the cantonal and federal level, academics, and the directors of the Swiss Innovation Authority, media people and senior businessmen. The delegation members mainly wanted to see and experience Israeli innovation, trying to understand and duplicate the “recipe” for innovation. We hope that we can hold a follow-up event in Switzerland, together with the Swiss Innovation Authority in 2018.
In November, the City of Tel Aviv was invited and visited Switzerland together with 10 Start-Ups for Innovation Day (SIF), which was organized by the Swiss Economic Forum. At this event, the Israeli companies presented their technology to an audience of several hundred people.
So what are the areas we have identified as relevant for 2018? We have identify the following:
Many Swiss companies are active in the field of pharma and medical devices, we see many potential opportunities in two events we participate regularly.
Sachs Forum – an event we will take part in for the third consecutive year. Through this event we can provide Early Stage companies with access to potential investors and Seed Money. The event spans three days in Basel and is visited by investment arms of the large pharmaceutical companies, investors in the fields of medicine, family offices, VCs and others.
MEDICA – Medical Equipment Exhibition in November in Germany, we recruit potential Swiss customers and arrange meetings with them.