I recently
visited Switzerland for a few days. It was interesting to see how the Swiss
have created one of the safest, richest, and most peaceful countries of the
world out of a hotch-potch of separate territories, different languages, and
diverse cultures. Native Italian, German, and French speakers in Switzerland
all feel Swiss. But the diversity doesn’t stop there. Over 30% of the
population, I am told, currently consists of immigrants. Probably the highest
proportion of immigrants anywhere in Europe. In Montreaux, I saw many Muslim
ladies with headscarves walking along the lake promenade, clearly relaxed and
having fun with their children, husbands, and girlfriends, and freely mingling
with the non-Muslim residents. On the train, I saw Swiss German passengers
effortlessly switching into French when speaking to the train conductor. The streets are replete with excellent restaurants with every kind of ethnic cuisine.
So what is
the secret behind the Swiss success? Several reasons suggest themselves:
1) Very decentralised government and
internal tax competition between cantons and councils for attracting businesses
and high net worth individuals.
2) A history of staying out of wars.
3) Providing a safe haven and a stable
jurisdiction for the protection of private wealth against criminal, thieving
governments.
4) A history of welcoming immigrants.
Particularly persecuted, high skill immigrants such as Hungarian watchmakers,
for instance, who provided the back-bone of the famed Swiss watch industry.
5) The low taxes created by the internal
Swiss tax competition attract not only businesses and high net worth
individuals from other places in Switzerland but also from abroad. And
continually so.
6) Prices are high, but so are
salaries, and taxes are low. This serves to attract even more high-skilled
individuals from abroad. It also attracts the low-skilled manpower needed to
ensure the continued excellent functioning of the Swiss infrastructure.
Compared to
the rest of Europe, Switzerland is still a paradise. Switzerland is Central
Europe in miniature with all the best that German, French, and Italian culture
have to offer.
Isn’t it an
interesting fact that the wealthiest, most prosperous nations in Europe are the
ones not in the EU? Switzerland, Norway, Liechtenstein, Monaco, and Andorra all
have a higher per capita wealth than the EU average and also than any EU
country (with the possible exception of Luxembourg). This suggests that the
Swiss example is still one to be followed.
