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SWITZERLAND EXPLAINED

Is Switzerland really a difficult country to settle in?

In a recent international survey, Switzerland ranked near the bottom in terms of friendliness of the local population toward foreigners, and the general difficulties they face in the country. But is this assessment justified?

People sit by a lake.
People sit by a lake. Is it hard to settle in Switzerland? Photo: photosforyou/Pixabay

Getting established in a new country is never easy, and Switzerland has the reputation of being very challenging in this respect.

This is one of the findings of the Expat Insider Survey, released on July 11th by InterNations, a network for foreign nationals living in 420 cities worldwide. 

In a category called  Ease of Settling In Index, Switzerland ranks in the 47th place out of 53 countries surveyed — a pretty dismal result for a country that prides itself on its hospitality.

It also ranks low (46th place) in Local Friendliness, and Culture & Welcome, and even lower (47th) in Finding Friends.

READ ALSO : How foreign residents rate life in Switzerland 

This finding will come as no surprise to many foreign residents for whom making friends here is an uphill struggle.

To be fair, however, Switzerland doesn’t have a monopoly on aloofness toward foreigners: neighbour Austria is a difficult country for newcomers as well, the same survey found.

In this regard, “Switzerland continues its tradition of ranking among the worst-rated destinations: it has never managed to make it out of the bottom 10,” the survey found.

“Expats find the local population unfriendly in general (22 percent versus 16 percent globally), and towards foreign residents in particular (27 percent versus 18 percent globally).”

A person sits at a cafe in Montreux, Switzerland.

A person sits at a cafe in Montreux, Switzerland. Photo by Sara Dubler on Unsplash

Culture shocks for foreigners 

While it would not be fair, or accurate, to say that all Swiss are aloof, many are.

Whether it’s because they are actually neutral, or just respectful of other people’s privacy, is hard to say. But you may find it challenging to socialise with the Swiss outside of work hours.

This probably has nothing to do with you personally — the Swiss, especially the older ones, don’t readily socialise after work; they prefer to go home and relax.

Many foreign residents also complain about other aspects of the settling-in process, especially those relating to rules and bureaucracy.

This is especially difficult for people who come from less organised and micromanaged nations — which means, basically, every other country on earth.

That’s because the Swiss have laws and regulations for so many things, it’s often hard to remember them all.

Among them are rules about trash disposal, no-noise Sundays, and ones regulating how and when to register (and re-register) in your commune of residence, to mention just a few.

READ ALSO: 7 common complaints that foreigners have about Switzerland 

Many foreigners have their own peeves about Switzerland, but if you ask them why they are still living in the country if they find so much negativity in it, they will probably realise it offers numerous advantages as well.

In fact, the ‘pros’ of Switzerland outweigh its ‘cons’ by far.

Quality of life, wages, safety and stability

The same survey – but many others as well – found that Switzerland ranks highly in several areas.

For example, it is among the top-10 countries in terms of quality of life; within that category, it is in the first place worldwide for environment and climate, and in the second for these two categories: safety, as well as salary and job security.

It’s no surprise that the Alpine country has gained points for its job offers – it is a magnet for foreign nationals looking to climb the career ladder.  

In fact, Switzerland has a large number of international companies: 850 have based their global or regional head offices here.

Zurich, for instance, is home to the Swedish-Swiss multinational automation company ABB, AXA insurance company, UBS and Credit Suisse banks, and the Swiss division of Google.

Meanwhile, two large Swiss healthcare companies – Roche and Novartis – are based in Basel.

READ ALSO: Where are Switzerland’s largest companies?

But there are many other ‘likes’ regarding life in Switzerland as well (and that’s without touching on the amazing Swiss chocolate, cheese and wine offerings). 

More than 90 percent of respondents to the InterNations survey rate the country’s political stability positively (versus 63 percent globally).

The direct democracy model is a unique feature of the Swiss political system. Plus the small country is known to have one of the world’s strongest economies.

A high percentage (97 percent versus 84 percent globally) also value Switzerland’s natural environment, the air quality (91 percent versus 66 percent globally), and the urban environment (84 percent versus 67 percent globally).  

Also, the majority of international residents appreciate the availability of public transportation (93 percent versus 73 percent globally), as well as road infrastructure (91 percent versus 75 percent globally).

This suggests that Switzerland can be both ‘bad’ and ‘good’ (or a bit of both!) – and it can depend on your mindset and your perspective.

What do you think? Let us know if Switzerland is a difficult country to settle in by leaving a comment or emailing us: news@thelocal.ch 

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SWITZERLAND EXPLAINED

Why German-speaking Swiss cantons will pay money to French-speaking ones

Nearly every one of Switzerland’s French-speaking cantons will be receiving financial support from German-speaking cantons in 2025. How does this happen, and why is there such a wealth disparity between certain parts of Switzerland?

Why German-speaking Swiss cantons will pay money to French-speaking ones

As outlined in annual data published by the Federal Finance Administration this week, six of the seven cantons where French is recognized as an official language will be receiving support from German-speaking cantons in 2025.

Geneva will be the sole exception – in fact, it’s contributing. 

Overall, 18 out of Switzerland’s 26 cantons will receive money – including many German speaking cantons (see map below) – and 8 will pay out to other cantons. In all the total transfer between cantons next year will add up to 6.2 billion Swiss francs.

Valais will be receiving the most financial support per number of residents – 2,469 francs per capita, followed by Jura at 2,229 francs and Neuchâtel at 1,818 francs per capita. 

The three cantons contributing the most – Zug (CHF 3,321 per capita), Schwyz (CHF 1,520) and Nidwalden (CHF 1,081) all recognise German as an official language. The other contributing cantons are Zurich, Geneva, Basel-CIty, Obwalden and Shaffhausen. 

Image: Federal Finance Administration

Why are cantons redistributing funds?

For decades each of Switzerland’s 26 cantons was able to hold onto the entirety of the taxes levied at the cantonal level, under the country’s devolved administration. 

This changed in 2008 when the Federal Council introduced the national financial equalisation mechanism, which had two purposes – reducing inequality in wealth between the country’s cantons, and ensuring that each could fulfil their responsibilities at the same level. 

Essentially some cantons (see below) take in far more in tax receipts than others and the mechanism is aimed at reducing the inequality that creates.

The redistribution also allows cantons to pay for public services which are harder to provide in certain parts of Switzerland than others, due to geographical challenges such as the Alps.

Using a complicated formula that has undergone several revisions, the cantons giving and taking funds are identified, before funds are distributed each year. 

READ MORE: EXPLAINED: Why Switzerland’s cantons are so powerful

So why are German-speaking cantons subsidising French-speaking ones? 

The distribution of specific industries and businesses within Switzerland’s cantons plays a significant role in the disparity. 

The German-speaking cantons of Zug, Nidwalden and Schwyz, who will contribute the most, are each significant centres of economic activity across multiple sectors.

Approximately eight percent of the country’s GDP is generated between these three cantons and it has seen dramatic growth over the past decade.

These three cantons also feature the highest overall concentration of startups in Switzerland, with Zug (13.7 per 1000 residents) in the lead, followed by Schwyz (6.07) and Nidwalden (4.42). 

Additionally, it’s also worth noting that ‘Crypto Valley’ – the concentration of cryptocurrency and blockchain businesses focused on the canton of Zug – is worth approximately $611.81 billion (CHF 548 billion). 

In comparison, many of the cantons receiving funds, in Switzerland’s French-speaking west feature a more specialized economy. 

For example, the cantons of Vaud and Valais, Jura and Neuchâtel are home to a significant proportion of Switzerland’s farms. 

Neuchâtel and Jura also have economies that are focused towards watchmaking and precision engineering. 

READ MORE: EXPLAINED: Why is Switzerland so famous for watches?

There have been efforts to diversify the economies of these cantons and embrace developing industries, such as the life sciences-focused ‘Health Valley’ and autonomous vehicle ‘Drone Valley’ initiatives, centered on the country’s west but these are still in their early years. 

Cantons set own tax rates

This leads to the role played by tax policy. 

Under Swiss law, cantons can set their rates of taxation – and they’re able to use it to continuously draw an influx of business and new arrivals. 

Zug (22.2%), Nidwalden (24.2%)  and Schwyz (25.3%) can afford to set some of the country’s most competitive individual tax rates, as opposed to Valais (36.5%), Jura (39.0%) and Neuachtel (38.1%). 

While not as wide a gulf, the company tax rates for Zug (11.85%), Nidwalden (11.97%) and Schwyz (14.6%) make them a far more attractive investment proposition than Valais (17.12%) and Jura (16.0%). 

Such competitive rates are possible because these ‘richer’ cantons have a wider economic base, diversified across several sectors.

This ensures greater resilience and a continual draw of new arrivals and enterprises, more so than cantons where one particular industry dominates and is subject to fluctuations from outside factors.

So does it run smoothly?

There is a fine balance to strike in the redistribution formula.

“The greater the support given to resource-poor cantons, the lower their incentive to seek to increase their tax base, and the more the resource-rich cantons have to hand over, the less the incentive to enlarge theirs,” Andreas Stöckli of the University of Fribourg told Swiss Info.

In other words the transfer from cantons that tax-attractive to those that are less tax-attractive needs to be well-balanced.

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