Switzerland: An Economic OverviewAbstractSwitzerland is one of the most prosperous countries in Europe. With a stable government, a healthy economy, a highly skilled workforce and strong tourism, Switzerland is the driving force of the world economy. However, in the coming years Switzerland will face three challenges that threaten its positive economic prospects: 1) agricultural protectionism, 2) non-membership of the EU and 3) an aging population. This paper briefly examines these three factors and how they will influence Switzerland's future economic growth and the country's well-being. Switzerland has one of the most stable economies in the world. Due to the country's small size and highly skilled workforce, exports and trade are critical to Switzerland's economic survival. In 2006, Switzerland's real GDP was 3.2% with exports exceeding imports by $9.6 billion (a trade surplus). The machinery, metals, electronics and chemicals sectors are known for precision and quality and account for well over half of Swiss export earnings. The country is about 60% self-sufficient and imports only 7.5% from the United States. With low inflation and unemployment (1% and 2.5% respectively), Switzerland is positioned to be a powerhouse in the world economy. The Swiss economy derives approximately 50% of its corporate profits from exports, of which approximately 70% is destined for the EU market (The World Factbook, 2007). Switzerland is also one of the most prosperous countries in the world in terms of private income. In 2003, the median household income in Switzerland was estimated at $54,000 (US), 26% higher than the 2003 US median income of $43,000. per capita, high insurance coverage per individual, and high health care rates. Switzerland is the headquarters of the World Health Organization (Geneva) and several major retail, pharmaceutical, banking and food companies such as Bally Shoe Company (high-end designer shoes), Credit Suisse (banking), Roche Holding AG (pharmaceuticals), Nestlé Foods, Rolex (high-end watches), Novartis (pharmaceuticals) and one of the world's largest banks, UBS AG with $9.4 billion in revenues (2006), (Top 500 Swiss Companies , 2006). An extraordinary achievement for a town that is just under twice the size of New Jersey. EU Membership The Swiss federal government is very divided over membership of the European Union (EU). In a referendum in March 2001, 70% of Swiss voters rejected steps towards EU membership (The World Factbook, 2007).