Pros and Cons of Swiss WTO Membership

 Switzerland has a very complicated relationship with the World Trade Organization. while technically a member since 1995, even today, less than 20% of its trade is in what is called preferential nations, and it maintaining, in some industries, tariffs of more than 100%. These factors are largely due to Switzerland holding on to many traditional trade practices and retaining historical trade partners. Most of Switzerland's trade is either with Liechtenstein or the EU and what is not mostly goes to countries in the European Free Trade Agreement. As with its tariffs, over the last 20 years, many tariffs have fallen, but tariffs in agriculture still average at 30% with some industries such as vegetables, meat, and dairy products having tariffs over 100%. This has allowed Switzerland to enjoy some benefits of the WTO without fully putting in its fair share. With this, the Swiss Frank has stayed strong even with the decline of the Euro in the early 2010s while this has been good for domestic markets (it encouraged immigration increasing demand) export-focused markets have suffered as with the decline of the Euro, the Frank does not go as far in europian markets.

https://docs.wto.org/dol2fe/Pages/SS/directdoc.aspx?filename=q:/WT/TPR/S355R1.pdf&Open=True

Causes of Inequality and Poverty in Swizerland

Over the past 10ish years, inequality in Switzerland has slowly gone down. This is due to multiple government programs to promote social equality through a progressive tax system and multiple welfare programs (Le News). Despite this, there are still many problems that surround the country. One of the largest being gender inequality. Switzerland was late to the game when it comes to women's right to vote as they did not receive that until 1971. Since then things have improved, but in recent years things are once again starting to slow. While not getting worse, the rate at which the country has battled gender inequality has been slowly decreasing and they are starting to lag behind other countries (Another Strike against Gender Inequality in Switzerland). Despite this, Switzerland still has one of the lowest inequality rates in the world with the richest 20% only making 4.4 times what the poorest 20% make (Le News). Unfortunately, that statistic does not take into account the ultra-rich which use Switzerland as a tax haven. The income tax in Switzerland is very low (only 11.5% in the highest tax bracket) and they have an added bonus of being very safe and one of the few countries that guarantee privacy in banking. Because of this, the Gini coefficient is higher than it otherwise would be. This has also led to many large businesses moving into Switzerland in order to avoid taxes (Living in Switzerland).

Works Cited:

“Another Strike against Gender Inequality in Switzerland.” European CEO, www.europeanceo.com/business-and-management/another-strike-against-gender-inequality-in-switzerland/. 

Le News. “Income Inequality Declines in Switzerland.” Le News, 11 Apr. 2019, lenews.ch/2019/04/03/income-inequality-declines-in-switzerland/.  

“Living in Switzerland.” No More Tax, 10 June 2020, nomoretax.eu/living/relocation-to-switzerland/.

Lorenz curve and Gini Coefficient

 Gini coefficient: 0.327

	0	20	40	60	80	100
perfect equality	0	20	40	60	80	100
2016	0	7.6	20	36.6	59.1	100
2006	0	7.4	19.4	35.9	58.6	100

from this data, we see that the bottom 80% all gained a larger share of the wealth showing that Switzerland is moving towards equality

% of people living in absolute poverty: 0%

% of people living in relative poverty: 7.9%

Aggregate Demand

Consumer Spending in Switzerland (millions of swiss francs)

Business Confidence

Government Spending (millions of swiss francs)

Balance of Trade (millions of swiss francs)

Looking at these graphs 3 of the 4 indicate growth in AD with an increased trade profit and increased consumer and government spending the decrease is in business confidence, but due to its overall volatility  i think the increase in the other indicators more than makes up for this decrease. 

Looking at AD and GDP they both seem to rise over the last 10 years however i do not believe there is enough data to come to any big conclusion.

The Level of Overall Economic Activity

Year	Real GDP (millions current US $)	GDP per capita (current US $)	GDP growth (annual %)
2008	554363	72488	2.15
2009	541506	69927	-2.22
2010	583783	74606	3.00
2011	699580	88416	1.69
2012	668043	83538	1.01
2013	688504	85112	1.85
2014	709182	86606	2.45
2015	679832	82082	1.33
2016	671309	80172	1.72
2017	679951	80450	1.80
2018	705140	82797	2.75

Unemployment, total (% of total labor force) (modeled ILO estimate)

Inflation, GDP deflator (annual %)

Current account balance (% of GDP)

Due to the combined factors that inflation is starting to become positive and unemployment is now starting to fall I believe Switzerland is now starting to leave the troff and climb to the peak once more.