Railways

Railways played a central role in industrialization; the first railway opened in 1847, between Zurich and Baden. Alfred Escher was the leader in developing the rail system. He warned in 1849 that the large neighbors were planning to circumvent Switzerland, making it a forgotten backwater." The new Swiss Confederation established in 1848 took alarm and acted. In 1852 Escher achieved a national law that mandated construction and operation would be left to private companies. Quickly competing lines were built. Escher headed the largest firm, the Swiss Northeastern Railway, with links to major foreign lines. Thanks to the competition between private players, by 1860 Switzerland had a network of over 1000 km of track. After a national referendum, the government nationalized most of the private lines in the early 20th century, merging them into the Swiss Federal Railways.^[4]

Industry

Industry was underdeveloped, except for textiles. The watch industry speeded up thanks to a rising -wide demand for time measurement as industrialization took hold in the West. Leading watchmakers organized a trade association in 1876.^[5] Longines, founded in 1832, discovered the luxury market to build a global reputation.^[6]

Banking slowly grew in importance, albeit far behind London and Paris. The Union Bank of Switzerland opened in 1862, the Swiss Bank Corporation in 1872. By the time of World War I, Switzerland's promises of secrecy and security attracted funding from wealthy parties worried about the impact of war and revolution.^[7]

Tourism

Tourism began in Switzerland with British mountaineers climbing the main peaks of the Bernese Alps in the early 19th century (Jungfrau 1811, Finsteraarhorn 1812). The Alpine Club in London was founded in 1857. Reconvalescence in the Alpine climate, in particular from tuberculosis, was another important branch of tourism in the 19th and early 20th centuries: for example in Davos, Graubünden. Due to the prominence of the Bernese Alps in British mountaineering, the Bernese Oberland was long especially known as a tourist destination. The first organised tourist holidays to Switzerland were offered during the 19th century by the Thomas Cook and Lunn Travel companies. Tourism in Switzerland had been exclusively for the rich until it became widely popular in the 20th century. ^[8][9]

Industry

The industrial sector began to grow in the 19th century with a laissez-faire industrial/trade policy, Switzerland's emergence as one of the most prosperous nations in Europe, sometimes termed the "Swiss miracle", was a development of the mid 19th to early 20th centuries, among other things tied to the role of Switzerland during the World Wars.^[10]

The Pharmaceutical industry in Switzerland directly and indirectly employs about 135,000 people and generates 5.7% of the GDP.^[11]

Switzerland's total energy consumption, which was dropping from the mid 1910s to the early 1920s, started to increase again in the early 1920s. It stagnated during the 1930s before falling again during the early 1940s; but rapid growth started once again in the mid 1940s.^[12]

In the 1940s, particularly during World War II, the economy profited from the increased export and delivery of weapons to Germany, France, the United Kingdom, and other European countries. However, Switzerland's energy consumption decreased rapidly. The co-operation of the banks with the Nazis (although they also co-operated extensively with the British and French) and their commercial relations with the Axis powers during the war were later sharply criticised, resulting in a short period of international isolation of Switzerland. Switzerland's production facilities were largely undamaged by the war, and afterwards both imports and exports grew rapidly.^[13]

GDP growth

In the 1950s, annual GDP growth averaged 5% and Switzerland's energy consumption nearly doubled. Coal lost its rank as Switzerland's primary energy source, as other imported fossil fuels, such as crude and refined oil and natural and refined gas, increased.^[14]

In the 1960s, annual GDP growth averaged 4% and Switzerland's total energy consumption nearly doubled again. By the end of the decade oil provided over three-quarters of Switzerland's energy.^[14]

In the 1970s the GDP growth rate gradually declined from a peak of 6.5% in 1970; GDP then contracted by 7.5% in 1975 and 1976. Switzerland became increasingly dependent on oil imported from its main suppliers, the OPEC cartel. The 1973 international oil crisis caused Switzerland's energy consumption to decrease in the years from 1973 to 1978.^[14] In 1974 there were three nationwide car-free Sundays when private transport was prohibited as a result of the oil supply shock. From 1977 onwards GDP grew again, although Switzerland was also affected by the 1979 energy crisis which resulted in a short-term decrease in Switzerland's energy consumption. In 1970 industry still employed about 46% of the labor force, but during the economic recession of the 1970s the services sector grew to dominate the national economy. By 1970 17.2% of the population and about one quarter of the work force were foreign nationals, though job losses during the economic recession decreased this number.^[13]

In the 1980s, Switzerland's economy contracted by 1.3% in 1982 but grew substantially for the rest of the decade, with annual GDP growth between about 3% and 4%, apart from 1986 and 1987 when growth decreased to 1.9% and 1.6% respectively.^[15]

Switzerland's economy was marred by slow growth in the 1990s, having the weakest economic growth in Western Europe. The economy was affected by a three-year recession from 1991 to 1993, when the economy contracted by 2%. The contraction also became apparent in Switzerland's energy consumption and export growth rates. Switzerland's economy averaged no appreciable increase (only 0.6% annually) in GDP.

After enjoying unemployment rates lower than 1% before 1990, the three-year recession also caused the unemployment rate to rise to its all-time peak of 5.3% in 1997. In 2008, Switzerland was in second place among European countries with populations above one million in terms of nominal and purchasing power parity GDP per capita, behind Norway (see list). Several times in the 1990s, real wages decreased since nominal wages could not keep up with inflation. However, beginning in 1997, a global resurgence in currency movement provided the necessary stimulus to the Swiss economy. It slowly gained momentum, and peaked in the year 2000 with 3.7% growth in real terms.^[16]

Gross domestic product

For the " gross regional product" (GRP) by canton see List of Swiss cantons by GRP. The richest five per capita are Basel, Zug, Geneva. Zurich, and Neuchâtel.

The chart below shows the trend of the gross domestic product of Switzerland at market prices:^[21]

Adopts Sanctions against Russia 2022

Following the 2022 Russian invasion of Ukraine, Switzerland decided to adopt all EU sanctions against Russia.^[22] According to the Swiss President Ignazio Cassis, the measures were "unprecedented but consistent with Swiss neutrality". The administration also confirmed that Switzerland would continue to offer its services to find a peaceful solution in the conflict. Switzerland only participates in humanitarian missions and provides relief supplies to the Ukrainian population and neighbouring countries.^[23] In total, about 870 people and more than 60 companies are subject to Swiss sanctions.^[24] Switzerland closed its airspace to Russian aircraft in March 2022.^[25]