Public finances

Switzerland lives up to its reputation as a stable country. The rate of inflation lies well below that in the EU states and the most important industrialized nations. This also holds true for unemployment, with the rate of those out of work regularly below 4%. Interest rates in Switzerland are also traditionally low thanks to a high savings rate and large in-flows of foreign money.

The public spending ratio measures expenditure by public administrations as a percentage of gross domestic product (GDP). It includes spending by public authorities and mandatory social insurance. In Switzerland this ratio is 32.6% (projection for 2008). In 2008, most European countries had a much higher ratio of government expenditure to GDP (France: 52.5%; Sweden: 51.2%; Italy: 48.4%; Germany: 43.4%).

The country is in a healthy financial situation. This applies to the financial budget of the central state, the federal government as well as the cantons and local authorities. The aggregate budget balance of all three levels is positive. The public deficit ratio of 1% is significantly below the average of EU and OECD member countries.

National debt is also below that of most countries in Europe. Total public sector debt amounts to 59% of GDP (2006). The national debt ratio remains below the EU average and that of the US.