We are seeing several success factors in our export and investment promotion agencies which will probably be similar in many developed countries – first and foremost, as mentioned, a strong focus on customers needs and the impact from geographical developments which require everyone to stay agile and flexible. Today, we have many more tools than 10 or 20 years ago to understand our customers better. Digitization plays an important role here but in a niche B2B offering, there’s always going to be some personal services as well. Also, the national and international network of partner institutions and experts are important to provide broad and specific support at the same time. And developing and keeping great talents to work for an agency underpins all of these activities.
1. Switzerland Global Enterprise (S-GE) has a long history in promoting exports, dating back from 1927. Also, the State Secretariat for Economic Affairs SECO and all cantons have been mandating S-GE to promote Switzerland as a business location since 2008. Can you tell us more about the institutional evolution of S-GE?
S-GE has always been an association under Swiss private Law. It was founded on July 8th, 1927 as the Schweizerische Zentrale für Handelsförderung (Swiss Office of Commercial Expansion). It was the Swiss federal government’s response to the demands of Swiss business for a united and active solution to Swiss export and commercial expansion. Involved were several Swiss business and branch associations.
The world economic crisis of the 1930s created big challenges for the Swiss economy, so to protect jobs and create new ones during that time, the Schweizerische Zentrale für Handelsförderung banked on exports. This led to the creation of an international network of commercial agencies. The offices – including ones in China, Canada and India – delivered valuable information about foreign markets and helped Swiss companies find outlets for their products abroad. These commercial agencies were the predecessors of the Swiss Business Hubs – our Global Network is spread all over the world and assist with evaluating markets and providing business contacts.
The Schweizerische Zentrale für Handelsförderung played an important role during the Second World War too, providing Swiss companies with information, for instance, about open transport routes and delivery and payment options abroad. At the same time, it broadcast a Swiss business chronicle to the world via radio and produced films about Switzerland that were shown to an international audience.
Names, tasks, mandates and offices changed during the second half of the 20th century but what has been important ever since is S-GE’s network – together with Swiss public and private players as well as experts from all over the world, S-GE provides Swiss SMEs with information, services and contacts for their entire internationalization process.
In 2008, the Swiss government mandated S-GE further tasks including the national Investment Promotion. Together with our partner network and in order to strengthen Switzerland as a business location we support innovative foreign companies with their establishment in our country. Also, S-GE was tasked with promotion the import from selected countries in order to support their economic development. This mandate got transferred to another organization as of 2017.
Since 2013, our organization has been known as Switzerland Global Enterprise (S-GE) – in the interest of Switzerland, we support Swiss SMEs in their international business and help innovative foreign companies to establish in Switzerland (“Global Enterprise”). We are globally active (“Global Enterprise”).
2. Last year, the World Intellectual Property Organization crowned Switzerland the most innovative country in the world for the tenth consecutive year. What are the key factors of the Swiss success?
It is indeed this innovative power. Swiss enterprises habitually strive to make improvements to their products, services and processes by investing heavily in research and development. This success is due, in part, to the presence of renowned research institutes and the ability to effectively turn research results into marketable products.
Switzerland acts like a magnet to qualified workers from abroad and retains the talent it grows. In the Global Talent Competitiveness Index by INSEAD, Switzerland takes first place. Swiss workers are generally well-educated and multilingual with above-average international experience. They are motivated, reliable, and dedicated employees.
Also, a stable currency, a federal state system, strong purchasing power, and economic, social and political stability guarantee a high level of security for investments in Switzerland. Even though Switzerland isn’t in the EU, it has bilateral trade agreements in place with every country in Europe. This ensures free movement of goods, services and people. Switzerland has even more free trade agreements than the EU has: in total 41 separate FTAs. Investing in an independent country like Switzerland significantly reduces the risks associated with international expansion.
And did you know that Switzerland’s labor market is characterized by liberal legislation, light-touch regulation, and exceptional social stability? Labor disputes are resolved by the social partners. Strikes are rare. The social insurance system for workers is based on the principles of solidarity and personal responsibility.
Last but not least, Switzerlandʼs tax system is a successful model: taxes are determined and levied at the federal, cantonal, and municipal levels. Domestic tax competition plays a significant role in the very low rates of taxation. The most attractive cantons in tax terms are international leaders with regard to both corporate taxes and the tax imposed on highly skilled workers.
3. In 2020, the coronavirus pandemic has pushed us further into a digital world and has accelerated the uptake of digital solutions, tools, and services. How has the pandemics changed the work of Switzerland Global Enterprise?
The needs of our customers changed dramatically during the first lockdown. At first, we supported Swiss SMEs wherever they came across obstacles in their international business as a result of travel restrictions and pandemic control measures. This was the case, for example, with the administration of cancelled trade fair participations and the stabilisation of supply chains, the maintenance of customer relations or the search for new customers for new partners.
In particular, our global network, the Swiss Business Hubs, a shared successful model of the Federal Department of Foreign Affairs Affairs EDA and us, proved to be a key added value here. They acted for our customers again and again as an extended arm in the target markets, e.g. for quality controls or by supporting SMEs vis-à-vis their customers and partners.
In addition, thanks to the close cooperation with the Swiss embassies we helped Swiss SMEs in requesting the authorities to release blocked goods or to issue special entry permits for important service personnel. We have also implemented new digital services and increased our exisiting digital offering, for example with our digital platform GoGlobal Cockpit or our new Virtual Showroom, a digital trade fair alternative. In the Investment Promotion, we launched new digital campaigns, targering corporate decision makers in our focus countries, positioning Switzerland as a innovation and technology hub.
4. The global network of S-GE’s offices currently counts 31 countries. What is the main role of Swiss Business Hubs and how do they differ from the so-called Trade Points?
Both kinds of offices are very similar, technically the Swiss Business Hubs tend to have more staff. All of our people in Switzerland and abroad work together for our customers and serve as „door opener“ for our clients due to their officiality.
5. S-GE has recognized the importance of building up the strong network of strategic and institutional partnerships. How does this network operate and which coordination tools are used to timely provide value-added services to your clients?
Together with our partners we strengthen the location Switzerland in the new normal. Be it in export promotion or in the investment promotion, we support our customers in their international business or their establishment in Switzerland, by providing them with the right contacts. We bring the players in export promotion and investment promotion together to one table several times a year, thus strengthening synergies and creating added value for our joint customers. We organize common coaching and training sessions for important topics, use common tools – for example a platform to manage the investment promotion process – and work together as a Team Switzerland abroad.
6. Switzerland is divided geographically and politically into 26 cantons. How does Switzerland Global Enterprise collaborate with the cantonal economic development agencies in terms of providing support to potential foreign investors?
Together with our partner network and in order to strengthen Switzerland as a business location we identify internationally active companies in our focus countries that could bring profitable future technologies and a high added value to the country. We build up networks in which these companies operate and inform them about Switzerland as a business location – through various personal and digital channels.
If a company is interested in establishing in Switzerland, S-GE validates the project, for example regarding Potential jobs, investment volume, innovation / technology, etc., and forwards it to the cantonal agencies which then accompany the establishment process on the ground. We steer our strategic activities via a joint group that meets regularly in Switzerland and coordinate our operational activities in each country.
7. The institutional framework of the national investment and export promotion system can be crucial for improving export performances and supporting the international development of the country. What would be your recommendations for establishing an efficient and client-oriented system?
This depends strongly on each national context and its institutions – there are many different successful models in the world. Generally, a strong focus on what customers – SMEs or potential investors – actually need can guide policy-makers.
Another factor is a global footprint, local expertise, that customers can tap into.
8. How do you perceive the work of the investment and export promotion agencies in the future?
We are seeing several success factors our export and investment promotion agencies which will probably be similar in many developed countries – first and foremost, as mentioned, a strong focus on customers needs and the impact from geographical developments which require everyone to stay agile and flexible. Today, we have many more tools than 10 or 20 years ago to understand our customers better. Digitization plays an important role here but in a niche B2B offering, there’s always going to be some personal services as well. Also, the national and international network of partner institutions and experts are important to provide broad and specific support at the same time. And developing and keeping great talents to work for an agency underpins all of these activities.
Credit Image: S-GE