Monetary policy challenges: Swiss exports in a globalised world
Philipp Hildebrand, Chairman of the Governing Board of the Swiss National Bank
Swiss Mission the European Union, Brussels, 23.11.2010
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In the past few decades, globalisation has advanced at a rapid pace, a development from which Switzerland has also reaped the benefits. However, the most recent financial and economic crisis has clearly demonstrated that the growing integration of the world economy also entails a number of risks. In Switzerland, too, exports – particularly goods exports – were hit hard during the crisis.
Nonetheless, export activity has in fact developed better than expected to date. Three factors are likely to have contributed to the favourable development of Swiss goods exports during and after the most recent crisis.
First, Switzerland’s increased geographical orientation towards the Asian market has allowed Swiss export companies to benefit considerably from the fast-paced recovery in Asia. Second, the growing focus on exports of consumer goods – in particular pharmaceuticals – has had a positive effect, since they react less sensitively to the business cycle. Third, Switzerland specialises in the production of high quality goods. In general, these products are – for the short term at least – less affected by fluctuations in demand.
On the whole, the Swiss export industry seems to be well positioned to compete successfully on a global level. Nonetheless, challenges lie ahead. Ongoing innovation and qualified human capital are, therefore, of the utmost importance in a high-wage country such as Switzerland. Yet these also rely on a stable business environment. By focusing its monetary policy activities on maintaining price stability, the Swiss National Bank is making its contribution to a stable business environment and, ultimately, to a prosperous economy.